The ruling by the Supreme Court of the United States striking down former President Donald Trump's tariffs imposed under emergency powers has triggered strong reactions from experts. While many see the judgment as a positive for emerging markets such as India, questions remain around refunds, trade negotiations and the future course of US tariff policy.
‘Big Relief for Emerging Markets'
Gurmeet Chadha, Managing Partner and CIO at Complete Circle Wealth Solutions, described the ruling as “a big relief for emerging markets like India”.
According to Chadha, the US economy is already showing signs of softness, particularly with weak fourth-quarter GDP numbers. “The US focus needs to shift back to bolstering growth,” he said, suggesting that prolonged tariff uncertainty would only weigh further on global demand.
He added that markets dislike ambiguity, and the Supreme Court's decision reduces a key overhang. “Markets don't want uncertainty, so this is great news,” Chadha noted. However, he cautioned that close attention must now be paid to how the tariff refund process is handled, given the billions of dollars at stake.
With India's macroeconomic fundamentals improving, Chadha believes the ruling comes at an opportune time for the country.
'Tone of Trade Talks Will Change'
Santosh Rao, Head of Research and Partner at Manhattan Venture Partners, said the decision represents a “big blow” to the Trump administration on the face of it, but stressed that the US government is unlikely to be left without options.
“The tone of conversation in international trade will change,” Rao said, adding that countries negotiating with the US now have more leverage. He expects the US administration to “go back to the drawing board”, particularly as the Treasury Secretary has indicated that a “Plan B” exists.
Rao suggested that the existing 18 per cent tariff on India is likely to remain in place for now, but fresh negotiations between the US and India could eventually lead to a consensus. He also believes it is unlikely that the US will refund tariffs already collected, despite legal uncertainties.
Overall, Rao sees the Supreme Court's move as positive for markets, even if trade policy adjustments take time.
Growth Boost for India
Gaura Sengupta of IDFC First Bank highlighted the growth implications for India. She noted that earlier US tariffs averaged around 2–2.5 per cent, whereas current tariffs stand at roughly 18 per cent on nearly half of India's exports to the US.
“From a growth perspective, it will be positive for India,” Sengupta said, pointing out that any moderation in tariff pressures would support export competitiveness and business sentiment.
Uncertainty Not Over Yet
Matt Orton, Head of Advisory Solutions and Market Strategy at Raymond James Investment Management, offered a more cautious take. He does not expect new trade deals to be signed immediately.
“Uncertainty is going to linger till other measures exist,” Orton said. Even if the tariffs are removed under one authority, alternative mechanisms could still be used. Companies that have factored existing trade deals into their capital expenditure plans may need to reassess timelines.
That said, Orton believes the spirit of current trade agreements is likely to be maintained, even as legal tools evolve.
Legal Limits and Ratification Questions
Sushil Singhal, a corporate lawyer and former Indian Foreign Service officer who has served as Ambassador to Angola and High Commissioner to Papua New Guinea, emphasised the constitutional dimension.
“The US administration has powers, but not punitive powers,” he said, arguing that arbitrary tariff decisions may face tighter scrutiny going forward. He also pointed out that trade agreements only come into force once ratified, and that there remains little clarity on the status of investments linked to such deals.
In sum, while the Supreme Court ruling is widely viewed as market-friendly and supportive for emerging economies like India, experts agree that the next phase — involving refunds, renegotiations and potential alternative tariff measures — will determine the lasting impact on global trade.
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