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White Black Legal – International Law Journal · ISSN 2581-8503
TARIFF AND TRADE POLICY IN INDIA: LEGAL CHALLENGES UNDER WTO LAW AND DOMESTIC REGULATION
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Abstract
TARIFF
AND TRADE POLICY IN INDIA: LEGAL CHALLENGES UNDER WTO LAW AND DOMESTIC
REGULATION
AUTHORED
BY - YUVRAJ CHOPRA
Third
Year Student, 3 Year LL.B
Department
of laws, Panjab University, Chandigarh
CO-AUTHOR
- DR. GURPREET KAUR
Assistant
Professor of Law, Panjab University Chandigarh.
Chairperson
Child Welfare Committee UT Chandigarh.
Mediator,
Mediation Centre Punjab and Haryana High Court
Retainer
Advocate for Markfed
Empanelled
Advocate for Greater Mohali Development Authority
ABSTRACT
India's
tariff and trade policy sits at the intersection of its binding commitments
under the World Trade Organization (WTO) framework and its sovereign
prerogative to regulate imports and exports through domestic instruments such
as the Customs Act, 1962, the Customs Tariff Act, 1975, and the Foreign Trade
(Development and Regulation) Act, 1992. [1][2][3][4] This paper undertakes
a doctrinal and policy analysis of the legal architecture governing India's
tariff measures, safeguard and anti-dumping actions, and export restrictions,
and situates that architecture within the turbulence of contemporary geopolitics.
The paper argues that the Russia–Ukraine war and the associated realignment of
global energy and fertilizer markets, the escalation of United States tariffs
on Indian exports between April 2025 and February 2026, [5][6][7] and recurrent
disruptions to maritime supply chains have collectively tested the adequacy of
India's legal toolkit for reactive trade governance. Using doctrinal analysis
of statutes and WTO jurisprudence — including India – Solar Cells, India –
Agricultural Products, and India – Sugar and Sugarcane [8][9][10] — alongside an
empirical review of India's post-2022 export-restriction and tariff-adjustment
measures, the paper demonstrates a discernible pattern: India increasingly
resorts to trade-remedial and quantitative instruments whose WTO-consistency is
doctrinally contestable, while simultaneously diversifying its treaty
relationships through new free trade agreements with the United Kingdom, the
European Free Trade Association and Gulf partners. [11][12][13] The paper further
examines the paralysis of the WTO Appellate Body and its consequences for the
enforceability of India's trade-remedy obligations. [14][15] The findings suggest
that India's policy responses — tariff adjustments, export prohibitions,
windfall taxation and quality-control orders — are legally defensible only
within narrow exception clauses of the GATT, and that overreliance on
unilateral measures risks both WTO litigation exposure and erosion of India's
credibility as a rules-based trading partner. The paper concludes with
recommendations for calibrated legal reform, including codified
emergency-trade-measure guidelines, institutional strengthening of the
Directorate General of Trade Remedies, and a coherent geo-economic trade
strategy responsive to future shocks.
Keywords
Tariff
Policy; WTO Law; GATT; Customs Tariff Act; Foreign Trade Policy 2023;
Geopolitics and Trade; Export Restrictions; Anti-Dumping; Safeguard Measures;
India–US Trade Relations.
1. INTRODUCTION
India
has been a contracting party to the General Agreement on Tariffs and Trade
since 8 July 1948 and a founding Member of the World Trade Organization since 1
January 1995. [16] Its tariff and trade
policy is therefore simultaneously a matter of domestic constitutional
competence — flowing from Entry 41 and Entry 83 of the Union List under Article
246 of the Constitution [17] —
and a matter of binding international obligation under the WTO covered
agreements. [18][19]
For much of the post-liberalisation period (1991 onward), Indian trade law
scholarship focused on tariff liberalisation, the dismantling of quantitative
restrictions, and compliance with WTO commitments. Since 2020, however, the
analytical centre of gravity has shifted. Successive shocks — the COVID-19
pandemic, the Russian invasion of Ukraine in February 2022, the Red Sea
shipping crisis, and the imposition of steep 'reciprocal' tariffs by the United
States between April 2025 and August 2025 — have compelled India to deploy its
trade-law toolkit not merely to liberalise, but to defend domestic price
stability, food security and strategic autonomy.
This
paper examines the legal architecture within which these defensive and adaptive
measures operate. It asks three connected questions. First, what domestic
statutory and constitutional instruments empower the Union Government to alter
tariffs and restrict trade, and what procedural and substantive constraints do
they impose? Second, to what extent are India's recent tariff adjustments,
export prohibitions and safeguard actions consistent with its obligations under
GATT 1994, the Agreement on Safeguards, the Anti-Dumping Agreement, and the SCM
Agreement? [20][21][22]
Third, how have geopolitical shocks — the Russia–Ukraine war's effect on oil
and fertilizer prices, and the 2025–2026 India–US tariff confrontation —
reshaped the practical operation of these legal instruments? The paper is
structured as follows: Part 2 reviews the literature on WTO law and Indian
trade regulation; Part 3 analyses the domestic and international legal
framework together with leading WTO case law involving India; Part 4 examines
the geopolitical dimension in detail, including import cost volatility,
supply-chain disruption and India's policy responses; Part 5 sets out findings;
Part 6 offers recommendations; and Part 7 concludes.
2. LITERATURE REVIEW
Scholarship
on Indian trade law has traditionally proceeded along two tracks. The first
track, doctrinal and WTO-centric, analyses India's compliance record before WTO
panels and the Appellate Body. Commentary on India – Certain Measures Relating
to Solar Cells and Solar Modules, for instance, treats the dispute as
emblematic of the tension between industrial policy objectives (energy
security, domestic manufacturing) and the national-treatment discipline of
Article III:4 GATT and Article 2 of the TRIMs Agreement. [23][24][25][26]
Similarly, analyses of India – Agricultural Products examine the limits of the
SPS Agreement as a justification for import prohibitions, [27]
while commentary on India – Measures Concerning Sugar and Sugarcane critiques
India's market price support and export-subsidy programmes for sugarcane
against the disciplines of the Agreement on Agriculture and the SCM Agreement. [28][29]
These strands of literature converge on the observation that India frequently
invokes the general exceptions of Article XX GATT or sector-specific
carve-outs, with mixed success before adjudicators who apply the exceptions
narrowly. [30]
The
second track is institutional and administrative, focusing on the Directorate
General of Trade Remedies (DGTR) and its predecessor bodies, the procedural
safeguards of the Customs Tariff Act, 1975, and judicial review of trade-remedy
determinations by the Supreme Court and the Customs, Excise and Service Tax
Appellate Tribunal. [31][32][33]
Landmark constitutional and interpretive rulings — such as Maganbhai Ishwarbhai
Patel v. Union of India on the executive's treaty-implementation power, and
Commissioner of Customs (Import) v. Dilip Kumar & Co. on the strict
construction of exemption notifications — anchor this literature in Indian
public law rather than international law. [34][35]
A
third and more recent strand of literature, still emergent, addresses the
'geo-economic turn' in trade regulation: the use of tariffs, export controls
and sanctions as instruments of foreign policy rather than economic efficiency.
Analyses of the 2025–2026 India–US tariff confrontation, the European Union's
and United States' sanctions architecture targeting Russian energy, and India's
food-export restrictions following the Ukraine invasion, situate trade law
within a broader security and diplomatic context. [36][37][38][39][40]
This literature has not yet been synthesised with the doctrinal WTO-compliance
literature described above; this paper attempts precisely that synthesis,
reading India's post-2022 tariff and export measures simultaneously as domestic
administrative acts, WTO-law questions, and instruments of geo-economic
strategy.
Gaps
remain. First, existing literature rarely integrates the Appellate Body's
continuing dysfunction — it has been unable to hear new appeals since 11
December 2019 for want of a quorum of serving members — into the analysis of
India's litigation risk. [41][42]
Second, the intersection of windfall taxation, export prohibition and safeguard
duties as a composite 'emergency trade toolkit' has not been examined as a
coherent legal category. This paper addresses both gaps.
3. ANALYSIS AND DISCUSSION
3.1 The Domestic Legal
Architecture
India's
power to impose, alter or exempt customs duties derives from the Customs Act,
1962 and the Customs Tariff Act, 1975, enacted pursuant to Entry 83 of the
Union List. [43][44][45]
Section 8B and Sections 9, 9A and 9B of the Customs Tariff Act, 1975
respectively empower the Central Government to impose safeguard duties,
anti-dumping duties and countervailing duties upon a determination of injury to
domestic industry by the designated authority. [46][47]
Since 2018, this investigative function has been consolidated in the
Directorate General of Trade Remedies (DGTR), which merged the erstwhile
Directorate General of Anti-Dumping and Allied Duties with the Directorate
General of Safeguards. [48]
Exemption notifications issued under Section 25 of the Customs Act are, per the
Supreme Court's Constitution Bench ruling in Commissioner of Customs (Import),
Mumbai v. Dilip Kumar & Co., to be construed strictly against the assessee
in cases of ambiguity — a rule of interpretation that channels significant
discretion back to the executive. [49]
Export
policy operates through a parallel but distinct track: the Foreign Trade
(Development and Regulation) Act, 1992 and the Foreign Trade Policy 2023 (FTP
2023) notified thereunder. [50][51]
Chapter 2 of the FTP 2023 empowers the Directorate General of Foreign Trade
(DGFT) to classify goods as 'free', 'restricted' or 'prohibited' for export,
and to impose ad hoc restrictions — the precise mechanism used for the wheat,
sugar and non-basmati rice export restrictions discussed in Part 4. [52]
Notably, changes to export policy are typically made through executive
notification rather than fresh primary legislation, which affords speed but
raises administrative-law questions of adequate notice to exporters holding
pre-existing contracts — an issue partially addressed through 'grandfather
clauses' exempting consignments already handed over to customs for examination
prior to the notification. [53]
The
treaty-implementation dimension of this framework rests on the Supreme Court's
ruling in Maganbhai Ishwarbhai Patel v. Union of India, which confirmed that
the Union executive may enter into and give domestic effect to international
agreements — including tariff concessions under GATT — through executive action
under Article 73 of the Constitution, without requiring a parliamentary statute
for every commitment, provided no existing statutory right is abridged. [54]
This constitutional latitude explains the speed with which India has concluded
and implemented recent free trade agreements, including the India–UK
Comprehensive Economic and Trade Agreement and the India–EFTA Trade and
Economic Partnership Agreement, which entered into force on 1 October 2025. [55][56]
3.2 The WTO Legal
Framework and India's Case Law
India's
tariff bindings are recorded in its WTO Schedule of Concessions under Article
II GATT, [57] while Article I requires
most-favoured-nation treatment and Article III requires national treatment for
imported goods once they have entered the domestic market. [58]
Departures from these disciplines are permissible only through the narrowly
construed general exceptions in Article XX (public morals, health,
conservation, and goods in short supply) or the security exception in Article
XXI, or through the trade-remedy agreements — Safeguards, Anti-Dumping, and SCM
— which permit temporary, injury-based measures subject to strict procedural
discipline. [59][60][61][62][63][64]
Three
WTO disputes involving India illustrate the doctrinal limits of these
exceptions. In India – Solar Cells (DS456), the Panel and Appellate Body
rejected India's defence of domestic-content requirements under the Jawaharlal
Nehru National Solar Mission, holding that the requirements violated Article
III:4 GATT and Article 2 of the TRIMs Agreement, and that neither the Article
XX(j) 'short supply' exception nor the Article XX(d) 'compliance' exception
justified the measure. [65][66][67]
The ruling narrowed the interpretive space available to India (and other
Members) for using local-content conditions to advance renewable-energy or
industrial policy objectives. In India – Agricultural Products (DS430), the
Appellate Body found that India's import prohibitions on poultry and other
agricultural products, ostensibly imposed to guard against avian influenza,
were not based on the relevant international standard and were not supported by
adequate risk assessment, in violation of the SPS Agreement. [68]
The ruling is instructive because it shows the WTO's insistence on scientific
and procedural rigour even where a Member invokes a bona fide public-health
rationale. In India – Sugar and Sugarcane (DS579–DS581), a Panel found in
December 2021 that India's mandatory minimum cane prices (the Fair and
Remunerative Price and various State Advised Prices) and its export-subsidy
schemes for sugar exceeded permissible domestic-support levels under the
Agreement on Agriculture and violated the SCM Agreement's prohibition on export
subsidies. [69] Because the WTO Appellate
Body has been non-functional since December 2019 for want of a quorum, India's
appeal of the Sugar panel report has, in practice, been left in limbo — an
'appeal into the void' — leaving the correctness of the panel's findings legally
unresolved even as the underlying policy questions remain live. [70][71]
Read
together, these cases demonstrate a consistent pattern: India's
industrial-policy and agricultural-support measures are frequently challenged,
and WTO adjudicators apply the general exceptions and agriculture/subsidy
disciplines strictly, leaving India with limited legal room to justify
protective measures except through properly conducted trade-remedy
investigations (safeguard, anti-dumping or countervailing duty proceedings)
rather than blanket restrictions or price-support schemes.
Figure
3: India's trade-policy response toolkit to geopolitical and supply-chain
shocks, 2020–2026 (illustrative frequency of instruments invoked).
4. GEOPOLITICAL DIMENSIONS: WAR, SUPPLY CHAINS AND TARIFF POLICY
The
period since February 2022 illustrates how exogenous geopolitical shocks feed
directly into the domestic and international legal analysis set out in Part 3.
Four interlinked phenomena are examined below: the indirect impact of the
Russia–Ukraine war on Indian trade policy; import-cost volatility in oil and
fertilizers; supply-chain disruption; and India's composite policy response of
tariff adjustment and export restriction.
4.1 Indirect Impact of
the Russia–Ukraine War
India
is not a party to the Russia–Ukraine conflict, but the war has had substantial
indirect legal and economic consequences for Indian trade policy. Western
sanctions on Russian energy exports created a large price differential between
Russian Urals crude and other benchmark grades, which Indian refiners exploited
by sharply increasing imports of discounted Russian crude — from a negligible
pre-war share of under two per cent of India's crude basket to figures reported
in the range of a third or more of total imports in subsequent years. [72]
This shift has generated friction with Western partners: the United States,
through Executive Order 14329 of 6 August 2025, imposed an additional 25 per
cent ad valorem tariff on Indian-origin goods explicitly citing India's
continued purchase of Russian oil, bringing the cumulative U.S. tariff on many
Indian exports to 50 per cent. [73][74]
From a public international law perspective, India's continued purchase of
Russian crude does not itself violate any WTO obligation — Article XI GATT
restricts import and export prohibitions by WTO Members but does not prohibit a
Member from choosing its trading partners for lawful goods — while the
countervailing use of tariff measures as a secondary-sanctions-style instrument
by the United States raises its own Article I (MFN) and Article XXI (security
exception) questions that remain untested before any WTO adjudicator, given the
Appellate Body impasse. [75][76][77]
Figure
2: Diversification of India's crude oil import sources amid the Russia–Ukraine
war, FY2021-22 to FY2025-26.
4.2 Import Cost
Volatility: Oil and Fertilizers
The
war disrupted two commodity markets of direct legal and regulatory significance
to India: crude petroleum and fertilizers. Russia and Belarus together
accounted for a substantial share of global potash, ammonia, urea and
monoammonium-phosphate exports prior to 2022; Western sanctions on Belarusian
and, to a lesser extent, Russian fertilizer trade caused global fertilizer
prices to spike sharply from March 2022 onward. [78]
India — heavily dependent on imported potash and phosphatic fertilizers, and
administering a large domestic fertilizer subsidy — responded by deepening
direct procurement arrangements with Russian suppliers, which industry sources
describe as a 'win-win' that helped avert domestic scarcity despite the broader
sanctions environment. [79]
On the petroleum side, the Government of India used its fiscal rather than
tariff powers, imposing a Special Additional Excise Duty (the so-called
'windfall tax') on exports of petrol, diesel and aviation turbine fuel from 1
July 2022, in order to capture a share of the extraordinary refining margins
generated by cheap Russian crude and to discourage domestic shortages caused by
refiners prioritising lucrative export markets over the domestic market. [80]
This measure exemplifies a distinctly domestic-law response — grounded in
excise rather than customs or WTO trade-remedy law — to a geopolitically
induced price shock, and did not require any WTO notification because export
taxes (as opposed to export quantitative restrictions) are not comprehensively
disciplined under GATT 1994.
4.3 Supply Chain
Disruptions
Beyond
commodity markets, the war and subsequent regional instability (including
Houthi attacks on Red Sea shipping from late 2023) lengthened transit times and
raised freight and insurance costs for India's westbound trade through the Suez
Canal corridor, compounding the cost pressures generated by volatile energy
prices. Diversification of shipping routes, increased freight insurance
premiums, and periodic congestion at Indian and Gulf ports have fed into input
costs for import-dependent sectors such as fertilizers, edible oils,
electronics components and petrochemicals. These disruptions strengthen the
policy case — though not, without more, the legal case under GATT — for
maintaining higher buffer stocks and for the kind of DGFT-administered
restricted/prohibited export categories discussed in Part 4.4, since Article
XI:2(a) GATT permits export prohibitions or restrictions only where
'temporarily applied to prevent or relieve critical shortages of foodstuffs or
other products essential to the exporting . . . Member'. [81]
Whether India's post-2022 restrictions meet the 'temporary' and 'critical
shortage' thresholds of this exception, rather than functioning as a standing
instrument of price management, is precisely the doctrinal question examined
next.
4.4 Policy Response:
Tariff Adjustments and Export/Import Restrictions
India's
principal legal responses to the shocks described above fall into four
categories. First, export prohibitions and restrictions: the DGFT banned wheat
exports with effect from 13 May 2022 (subject to grandfathered consignments and
government-to-government humanitarian exceptions), citing the need to manage
domestic food security and to contain a domestic price rise driven by a
coincidence of a domestic heatwave and the loss of Black Sea supply. [82][83] A
broken-rice export ban followed in September 2022, and further restrictions on
non-basmati white rice and sugar followed in 2022–2023, as India —
traditionally a residual supplier that had absorbed part of the Ukraine-related
global shortfall in April 2022 — sought to avoid depleting domestic buffer
stocks. [84][85]
The G7 publicly criticised the wheat ban as liable to 'worsen the crisis' of
global food-price inflation, underscoring the diplomatic as well as legal
stakes of Article XI:2(a)'s 'critical shortage' threshold. [86]
Second,
tariff adjustments: successive Union Budgets and standalone customs
notifications between 2022 and 2025 raised basic customs duty on select
finished goods to manage the trade deficit and support domestic manufacturing
under the Production-Linked Incentive framework, while periodically lowering
duties on inputs such as edible oils to contain consumer price inflation
exacerbated by the war. Such changes operate within India's bound tariff
ceilings under its WTO Schedule and are therefore, in the ordinary case,
unproblematic under Article II GATT provided the applied rate does not exceed
the bound rate. [87]
Third,
trade-remedy measures: the DGTR's caseload of anti-dumping investigations —
heavily weighted toward chemicals, steel and electronics inputs from China and
other Asian exporters — expanded through the review period, reflecting both
genuine injury claims linked to diverted Chinese capacity and a degree of
protective recourse to trade-remedy law as the most WTO-defensible channel for
restricting import competition. [88][89][90]
Fourth,
retaliatory and defensive response to the 2025–2026 U.S. tariff escalation:
following the 'Liberation Day' announcement of a 27 per cent reciprocal tariff
on 2 April 2025, [91]
the subsequent 25 per cent additional Russia-linked tariff effective 27 August
2025 that brought the cumulative rate to 50 per cent on a majority of India's
dutiable exports to the United States, [92][93][94]
India did not impose mirroring retaliatory tariffs but instead pursued a
negotiated Interim Trade Agreement, announced in February 2026, under which the
reciprocal component was reduced to 18 per cent in exchange for commitments
including a reduction in Russian energy purchases. [95][96]
In parallel, India accelerated its free trade agreement diversification
strategy, bringing the India–UK Comprehensive Economic and Trade Agreement and
the India–EFTA Trade and Economic Partnership Agreement into effect, and
concluding a CEPA with Oman in December 2025, thereby reducing dependence on
any single export market. [97][98][99][100]
Figure
1: Escalation of U.S. tariffs on Indian goods, April 2025 – February 2026.
3.3 / 4.5 Synthesis: A
Composite 'Emergency Trade Toolkit' and Its Legal Risk
The
instruments surveyed above — export prohibition under the FTDR Act/FTP 2023,
windfall excise taxation, safeguard and anti-dumping duties under the Customs
Tariff Act, and negotiated tariff concessions under bilateral FTAs — function,
in combination, as a composite emergency trade toolkit that India has deployed
with increasing frequency since 2020. Legally, each instrument sits on a
different footing: export prohibitions must satisfy the 'temporary' and
'critical shortage' conditions of Article XI:2(a) GATT if they are to escape
the general prohibition on quantitative restrictions in Article XI:1; [101]
trade-remedy duties must satisfy the injury, causation and procedural
disciplines of the Safeguards, Anti-Dumping and SCM Agreements; [102][103][104]
and FTA tariff concessions must be notified and are generally WTO-consistent
under the Article XXIV GATT exception for free trade areas provided they cover
substantially all trade. The principal legal risk identified in this paper is
that instruments originally designed as temporary, crisis-specific responses
(the wheat and rice export restrictions, for example) have in practice
persisted well beyond the acute phase of the shock that justified them,
creating cumulative exposure to a WTO challenge analogous to the sugar dispute,
particularly given the continued dysfunction of the Appellate Body, which
removes the ordinary appellate check on adverse panel findings but does not
remove India's underlying obligation to comply. [105][106][107]
5. FINDINGS
1. India's
domestic legal framework — the Customs Act, 1962, the Customs Tariff Act, 1975,
and the Foreign Trade (Development and Regulation) Act, 1992 — provides the
Union executive with wide, largely notification-based discretion to adjust
tariffs and restrict trade, subject to only limited procedural checks beyond
injury determination by the DGTR.
2. WTO
adjudicators have consistently construed India's public-policy defences (short
supply, compliance, SPS risk) narrowly, as shown in the Solar Cells,
Agricultural Products and Sugar and Sugarcane disputes, leaving properly
conducted trade-remedy investigations as the most litigation-resistant channel
for protective measures.
3. The
Russia–Ukraine war has had a predominantly indirect but legally consequential
effect on Indian trade policy: it altered crude-oil and fertilizer sourcing
patterns, triggered a domestic windfall tax rather than a tariff response on
petroleum products, and became the stated justification for the United States'
additional 25% tariff on Indian goods from August 2025.
4. India's
post-2022 export restrictions on wheat, rice and sugar occupy contested legal
terrain under Article XI:2(a) GATT; their prolongation beyond the acute 2022
shock increases, rather than decreases, WTO litigation risk over time.
5. The
2025–2026 India–US tariff confrontation was resolved primarily through
bilateral negotiation (the February 2026 Interim Trade Agreement) rather than
WTO dispute settlement, reflecting the practical marginalisation of the WTO's
adjudicative function amid the continuing Appellate Body impasse.
6. India's
parallel strategy of concluding new FTAs (UK, EFTA, Oman) functions as a
legally sound and WTO-consistent hedge against both geopolitical tariff shocks
and the erosion of multilateral dispute settlement, diversifying market access
outside the contested WTO/US bilateral channel.
6. RECOMMENDATIONS
1. Codify
a statutory framework for 'emergency trade measures' — including sunset clauses
and mandatory periodic review — to ensure that export restrictions invoked
under Article XI:2(a) GATT remain demonstrably temporary and shortage-linked,
reducing exposure to WTO challenge.
2. Strengthen
the institutional capacity and procedural transparency of the Directorate
General of Trade Remedies, including published reasoned orders and timelines
aligned with the Anti-Dumping and Safeguards Agreements, to ensure protective
measures are litigation-resilient.
3. Establish
a standing inter-ministerial geo-economic risk unit (Ministry of Commerce and
Industry, Ministry of External Affairs, Ministry of Petroleum and Natural Gas,
and Ministry of Finance) to model tariff, energy and supply-chain contingencies
before shocks materialise, rather than responding ad hoc.
4. Pursue
accession to, or an equivalent bilateral arrangement mirroring, an interim
appeal mechanism for WTO disputes, to preserve appellate review of adverse
panel findings notwithstanding the Appellate Body impasse.
5. Continue
and deepen FTA diversification (EU, Gulf Cooperation Council, ASEAN review,
ongoing US Bilateral Trade Agreement negotiations) to reduce concentration risk
in any single export market, while ensuring new FTAs meet the 'substantially
all trade' threshold of Article XXIV GATT to remain WTO-consistent.
6. Introduce
a formal legal-risk disclosure requirement within DGFT export-restriction
notifications, requiring the notification to specify the factual basis for
invoking the Article XI:2(a) exception, to strengthen India's defensive
position in any future WTO proceeding.
7. CONCLUSION
This
paper has examined India's tariff and trade policy as a field of law under
simultaneous pressure from two directions: the doctrinal discipline of WTO law,
which narrowly circumscribes the exceptions available to justify protective and
restrictive measures, and the practical exigencies of a geopolitically volatile
trading environment defined by war, sanctions, and an increasingly
transactional American tariff policy. The domestic legal framework — flexible,
notification-driven, and constitutionally well-founded — has allowed India to
respond quickly to each shock: the Ukraine-war-driven wheat and rice export
restrictions, the windfall tax on petroleum exports, and the negotiated
de-escalation of the 2025–2026 tariff confrontation with the United States. Yet
flexibility carries its own legal cost. WTO case law involving India — from
Solar Cells to Sugar and Sugarcane — shows that ad hoc, prolonged, or
insufficiently evidenced restrictive measures remain vulnerable to challenge, a
vulnerability only partially mitigated by the current dysfunction of the WTO
Appellate Body. The most durable response, this paper concludes, lies not in
retreating from multilateral discipline but in building sturdier domestic legal
processes around India's emergency trade toolkit, while continuing to diversify
India's treaty relationships so that no single geopolitical relationship — with
Russia, the United States, or any other partner — can again generate the scale
of legal and economic disruption witnessed between 2022 and 2026.
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(the 'windfall tax' on domestic crude and fuel exporters).
23. Customs
Tariff (Identification, Assessment and Collection of Countervailing Duty on
Subsidized Articles and for Determination of Injury) Rules, 1995, framed under
s. 9 of the Customs Tariff Act, 1975.
24. Department
of Commerce, Ministry of Commerce and Industry, Government of India,
Directorate General of Trade Remedies — Constitution and Mandate (2018)
(merging the erstwhile Directorate General of Anti-Dumping and Allied Duties
and the Directorate General of Safeguards).
25. Ministry
of Commerce and Industry, Government of India, Foreign Trade Policy 2023, ch. 2
(General Provisions Regarding Imports and Exports), paras 2.107–2.108 (export
prohibition and restriction).
D.
Case Law (Supreme Court of India)
26. Maganbhai
Ishwarbhai Patel v. Union of India, (1970) 3 SCC 400 (Supreme Court of India)
(on the treaty-making and implementation power of the Union executive under
art. 73 of the Constitution).
27. Commissioner
of Customs (Import), Mumbai v. Dilip Kumar & Co., (2018) 9 SCC 1 (Supreme
Court of India, Constitution Bench) (rule of strict construction of exemption
notifications under the Customs Act, 1962).
E.
U.S. and Bilateral Instruments
28. Exec.
Order No. 14257, Regulating Imports With a Reciprocal Tariff to Rectify Trade
Practices that Contribute to Large and Persistent Annual United States Goods
Trade Deficits, 90 Fed. Reg. 15041 (Apr. 2, 2025).
29. Exec.
Order No. 14329 (Aug. 6, 2025) (imposing an additional 25% ad valorem duty on
Indian-origin goods with reference to India's continued purchase of
Russian-origin crude oil).
30. The
White House, Fact Sheet: The United States and India Announce Historic Trade
Deal (Feb. 2026),
https://www.whitehouse.gov/fact-sheets/2026/02/fact-sheet-the-united-states-and-india-announce-historic-trade-deal/.
31. India–European
Free Trade Association (EFTA) Trade and Economic Partnership Agreement, signed
10 March 2024, entered into force 1 October 2025.
F.
Journal Articles, Reports and Secondary Sources
32. Vrinda
Yadav, India — Certain Measures Relating to Solar Cells and Solar Modules, 2(3)
Intl. J. for Legal Research & Analysis (2024).
33. Global
Trade Research Initiative, Trump's Reciprocal Tariffs and India: Flagship
Report (2025).
34. Kishore
Dash, India Bans Exports of Wheat, Complicating Efforts to Address Global Food
Security Problems Posed by Russia's War in Ukraine, Washington International
Trade Association Blog (16 May 2022).
35. International
Food Policy Research Institute, Food Export Restrictions Have Eased as the
Russia-Ukraine War Continues, But Concerns Remain for Key Commodities, IFPRI
Blog (2024).
36. Centre
for Social and Economic Progress, India and Sanctions on Russian Energy: Policy
Response and Future Options (Oct. 2025).
37. WTO,
Overview of the Appellate Body,
https://www.wto.org/english/tratop_e/dispu_e/appellate_body_e.htm (noting that
the Appellate Body has been unable to hear new appeals since 11 December 2019
owing to a shortfall in the number of serving members).
38. AIB
Insights, The India–UK Free Trade Agreement: A Boon or a Curse?, Published in
AIB Insights (Nov. 2025) (recording signature of the India–UK Comprehensive
Economic and Trade Agreement).
39. India
Briefing, US Tariff on India: Navigating 50 Per Cent Tariff Rate and Trade
Rules (27 Aug. 2025).
40. [38]
Easyship, Trump Tariff on India 2025: 50% U.S. Duties & Impact on Trade
(2025).
41. Deccan
Herald, Discounts Lift Russia's Fertilizer Exports, Becomes Top Supplier to
India (2022).
42. ClearTax,
US Tariff on India: Impact, Affected Products, Rates and India's Response (July
2026) (recording the interim reduction of the U.S. reciprocal tariff from 25%
to 18% under the February 2026 framework).
43. India
Briefing, India's Free Trade Agreements: Updates in 2025 (23 Dec. 2025)
(India–Oman CEPA signed 18 December 2025; entry into force anticipated in early
2026).
44. WTO,
India and the WTO, https://www.wto.org/english/thewto_e/countries_e/india_e.htm
(India a founding Member since 1 January 1995 and a contracting party to GATT
1947 since 8 July 1948).
45. Business
Standard, From UK FTA to US Tariff Duels: What 2025 Revealed About India's
Tradecraft (28 Dec. 2025).
[1]Marrakesh
Agreement Establishing the World Trade Organization, Apr. 15, 1994, 1867
U.N.T.S. 154 [hereinafter WTO Agreement].
[2]The Customs Act,
1962, No. 52, Acts of Parliament, 1962 (India).
[3]The Customs Tariff
Act, 1975, No. 51, Acts of Parliament, 1975 (India), ss. 8B, 9 and 9A.
[4]The Foreign Trade
(Development and Regulation) Act, 1992, No. 22, Acts of Parliament, 1992
(India).
[5]Exec. Order No.
14257, Regulating Imports With a Reciprocal Tariff to Rectify Trade Practices
that Contribute to Large and Persistent Annual United States Goods Trade
Deficits, 90 Fed. Reg. 15041 (Apr. 2, 2025).
[6]Exec. Order No.
14329 (Aug. 6, 2025) (imposing an additional 25% ad valorem duty on
Indian-origin goods with reference to India's continued purchase of
Russian-origin crude oil).
[7]The White House,
Fact Sheet: The United States and India Announce Historic Trade Deal (Feb.
2026),
https://www.whitehouse.gov/fact-sheets/2026/02/fact-sheet-the-united-states-and-india-announce-historic-trade-deal/.
[8]India — Certain
Measures Relating to Solar Cells and Solar Modules, WT/DS456/AB/R (Sept. 16,
2016) [hereinafter Solar Cells AB Report].
[9]India — Measures
Concerning the Importation of Certain Agricultural Products, WT/DS430/AB/R
(June 4, 2015) (avian-influenza import prohibitions).
[10]India — Measures
Concerning Sugar and Sugarcane, WT/DS579/R, WT/DS580/R & WT/DS581/R
(circulated 14 Dec. 2021) (Brazil, Australia and Guatemala v. India).
[11]AIB Insights, The
India–UK Free Trade Agreement: A Boon or a Curse?, Published in AIB Insights
(Nov. 2025) (recording signature of the India–UK Comprehensive Economic and
Trade Agreement).
[12]India–European
Free Trade Association (EFTA) Trade and Economic Partnership Agreement, signed
10 March 2024, entered into force 1 October 2025.
[13]India Briefing,
India's Free Trade Agreements: Updates in 2025 (23 Dec. 2025) (India–Oman CEPA
signed 18 December 2025; entry into force anticipated in early 2026).
[14]Understanding on
Rules and Procedures Governing the Settlement of Disputes, Apr. 15, 1994, 1869
U.N.T.S. 401, art. 17 [hereinafter DSU].
[15]WTO, Overview of
the Appellate Body,
https://www.wto.org/english/tratop_e/dispu_e/appellate_body_e.htm (noting that
the Appellate Body has been unable to hear new appeals since 11 December 2019
owing to a shortfall in the number of serving members).
[16]WTO, India and the
WTO, https://www.wto.org/english/thewto_e/countries_e/india_e.htm (India a
founding Member since 1 January 1995 and a contracting party to GATT 1947 since
8 July 1948).
[17]Constitution of
India, art. 246 read with Union List, Entry 41 (trade and commerce with foreign
countries) and Entry 83 (duties of customs).
[19]General Agreement
on Tariffs and Trade 1994, Apr. 15, 1994, 1867 U.N.T.S. 187, art. II (Schedules
of Concessions).
[20]Agreement on
Safeguards, Apr. 15, 1994, 1869 U.N.T.S. 154.
[21]Agreement on
Subsidies and Countervailing Measures, Apr. 15, 1994, 1869 U.N.T.S. 14
[hereinafter SCM Agreement].
[22]Agreement on
Implementation of Article VI of the General Agreement on Tariffs and Trade 1994
(Anti-Dumping Agreement).
[24]India — Certain
Measures Relating to Solar Cells and Solar Modules, WT/DS456/R (Feb. 24, 2016).
[25]Vrinda Yadav,
India — Certain Measures Relating to Solar Cells and Solar Modules, 2(3) Intl.
J. for Legal Research & Analysis (2024).
[26]Agreement on
Trade-Related Investment Measures, Apr. 15, 1994, 1868 U.N.T.S. 186, art. 2.
[30]GATT 1994, art. XX
(General Exceptions).
[32]Customs Tariff
(Identification, Assessment and Collection of Countervailing Duty on Subsidized
Articles and for Determination of Injury) Rules, 1995, framed under s. 9 of the
Customs Tariff Act, 1975.
[33]Department of
Commerce, Ministry of Commerce and Industry, Government of India, Directorate
General of Trade Remedies — Constitution and Mandate (2018) (merging the
erstwhile Directorate General of Anti-Dumping and Allied Duties and the
Directorate General of Safeguards).
[34]Maganbhai
Ishwarbhai Patel v. Union of India, (1970) 3 SCC 400 (Supreme Court of India)
(on the treaty-making and implementation power of the Union executive under
art. 73 of the Constitution).
[35]Commissioner of
Customs (Import), Mumbai v. Dilip Kumar & Co., (2018) 9 SCC 1 (Supreme
Court of India, Constitution Bench) (rule of strict construction of exemption
notifications under the Customs Act, 1962).
[38]Global Trade
Research Initiative, Trump's Reciprocal Tariffs and India: Flagship Report
(2025).
[39]Centre for Social
and Economic Progress, India and Sanctions on Russian Energy: Policy Response
and Future Options (Oct. 2025).
[40]India Briefing, US
Tariff on India: Navigating 50 Per Cent Tariff Rate and Trade Rules (27 Aug.
2025).
[51]Ministry of
Commerce and Industry, Government of India, Foreign Trade Policy 2023 (notified
31 March 2023, effective 1 April 2023).
[52]Ministry of
Commerce and Industry, Government of India, Foreign Trade Policy 2023, ch. 2
(General Provisions Regarding Imports and Exports), paras 2.107–2.108 (export
prohibition and restriction).
[53]Directorate
General of Foreign Trade, Notification No. 06/2015-2020 (13 May 2022)
(prohibiting export of wheat, subject to exemptions for consignments already
registered and government-to-government humanitarian commitments).
[62]GATT 1994, art. XI
(General Elimination of Quantitative Restrictions).
[80]Ministry of
Finance, Department of Revenue, Notification imposing Special Additional Excise
Duty on export of petrol, diesel and aviation turbine fuel (1 July 2022) (the
'windfall tax' on domestic crude and fuel exporters).
[83]Kishore Dash,
India Bans Exports of Wheat, Complicating Efforts to Address Global Food
Security Problems Posed by Russia's War in Ukraine, Washington International
Trade Association Blog (16 May 2022).
[85]International Food
Policy Research Institute, Food Export Restrictions Have Eased as the
Russia-Ukraine War Continues, But Concerns Remain for Key Commodities, IFPRI
Blog (2024).
[94]Easyship, Trump
Tariff on India 2025: 50% U.S. Duties & Impact on Trade (2025).
[96]ClearTax, US
Tariff on India: Impact, Affected Products, Rates and India's Response (July
2026) (recording the interim reduction of the U.S. reciprocal tariff from 25%
to 18% under the February 2026 framework).
[100]Business Standard,
From UK FTA to US Tariff Duels: What 2025 Revealed About India's Tradecraft (28
Dec. 2025).
How to Cite This Article
YUVRAJ CHOPRA, DR. GURPREET KAUR, TARIFF AND TRADE POLICY IN INDIA: LEGAL CHALLENGES UNDER WTO LAW AND DOMESTIC REGULATION., White Black Legal – International Law Journal, ISSN: 2581-8503, Vol. Volume 4, Issue VOLUME 4 ISSUE 2, October 2026, pp. 1106-1127. Available at: https://www.whiteblacklegal.co.in/details/tariff-and-trade-policy-in-india-legal-challenges-under-wto-law-and-domestic-regulation
Author & Publication Record
Authors: YUVRAJ CHOPRA & DR. GURPREET KAUR
Registration ID: 107193 | Published Paper ID: WBL7193 & WBL7194
Year: Oct- 2026 | Volume: 4 | Issue: 2
Approved ISSN: 2581-8503 | Country: Delhi, India
Page No.: 1106-1127
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