With the expiry of the 10% tariff imposed under Section 122 of the US Trade Act, Indian exporters are set to receive significant tariff relief in the US market. From July 24 onwards, Indian merchandise exports to the United States will once again be subject only to the normal WTO-compatible US most-favoured-nation (MFN) tariffs.
According to estimates by the Global Trade Research Initiative (GTRI), around 92% of India's $87.2 billion merchandise exports to the US will now attract MFN tariff rates. However, products covered under Section 232 national security tariffs—including steel, aluminium, certain copper products, automobiles, and specified auto components—will continue to face additional duties.
The tariff regime for Indian merchandise exports to the US has undergone multiple changes over the past year. The Section 122 tariff was announced on February 20, 2026, came into effect on February 24, 2026, and remained in force for the maximum statutory period of 150 days.
As a result, Indian exports have witnessed three distinct US tariff regimes in less than a year—from proposed 50% reciprocal tariffs to a 10% Section 122 surcharge, and now a return to MFN tariffs.
GTRI estimates that around 8% of India's exports to the US, comprising products such as steel, aluminium, and auto components covered under Section 232, will continue to remain subject to elevated national security tariffs. These products will pay the applicable US MFN tariff in addition to the Section 232 levy.
India and the US are currently negotiating a Bilateral Trade Agreement (BTA), which is expected to provide greater market access and tariff certainty for exporters. The two countries have also set an ambitious target of expanding bilateral trade to $500 billion over the next five years.This edit improves clarity, corrects grammar and chronology, and tightens the final paragraph to better reflect the bilateral trade target.