India likely to seek removal of US steel tariffs in trade talks rather than immediate retaliation

India may not retaliate immediately against the US over its steep tariffs on steel and aluminium, and may instead seek their removal through the ongoing talks on a bilateral trade agreement (BTA), two people familiar with the matter said.

India, in the first instance, will try to negotiate the issue between 5 June, when a US delegation is expected in New Delhi for talks on the trade agreement, and 8 June, the deadline for India to respond at the WTO.

However, India will reserve its right to retaliate.

A US notification to the World Trade Organization (WTO), circulated on 23 May, rejected India’s claim that the tariffs were safeguard measures under WTO rules. The WTO allows countries to take ‘safeguard’ measures to protect domestic industries from a surge in imports.

The BTA talks are in their final stage, with both sides showing flexibility and making positive progress. Against this backdrop, India is expected to use the trade negotiations to press for a rollback of the Section 232 duties as part of a broader package aimed at improving market access. Section 232 is a domestic.

 US legal provision that allows the president to use tariffs on imports deemed to threaten national security.

A high-ranked US delegation is set to start a second round of face-to-face talks with their Indian officials from 5 June in a bid to finalize the deal.

New Delhi had, earlier this month, informed the WTO of its intention to suspend concessions under the Safeguards Agreement in response to the Section 232 tariffs the US imposed in 2018 on national security grounds. This was in response to the 10 February US decision to impose a 25% tariff effective 12 March and its move to subsequently raise it to 50%.

India had argued that these duties amounted to safeguard measures and warranted equivalent countermeasures. However, Washington dismissed the claim, insisting that the duties were not safeguard actions but national security measures, and therefore outside the scaphite's a matter of concern for us. We are reviewing all the options. The right move will be taken at the right time. India’s position is not what it used to be, but we believe in handling such critical issues with a sense of perpetuality.