Section 232 tariffs on steel and aluminium represent a structural challenge for India-U.S. trade normalisation that bilateral deals alone cannot resolve. Discuss.

Q. Section 232 tariffs on steel and aluminium represent a structural challenge for India-U.S. trade normalisation that bilateral deals alone cannot resolve. Discuss. (15 marks, 250-350 words)

Section 232 of the U.S. Trade Expansion Act, 1962 permits import restrictions on national-security grounds. Unlike reciprocal tariffs, the resulting 50% duty on steel and aluminium applies to all origins [3] — placing it largely outside the reach of bilateral bargaining.

Why the challenge is structural, not transactional - Distinct legal basis: Section 232 rests on a security finding, not on trade imbalance. Relief negotiated on the reciprocal-tariff track therefore leaves it untouched. - Erga omnes design: the duty is global, so India is treated on par with the EU, Japan or the UK. Any India-specific carve-out would invite parallel demands from every partner, weakening the U.S. incentive to concede. - Widening base: coverage keeps extending to derivative (downstream) products, while exclusion requests are no longer processed and prior country-level arrangements stand revoked [3] — squeezing India's engineering exports.

Evidence that bilateral deals underdeliver - The India-U.S. Joint Statement (February 7, 2026) cut reciprocal tariffs to 18% and promised removal on gems, generic pharmaceuticals and aircraft parts; on the Section 232 track it conceded relief only for certain aircraft and aircraft parts [2]. - The 2023 settlement of India's WTO dispute had yielded a quota-based tariff-free arrangement for Indian metals; it did not survive the 2025 revocation of country arrangements [1][3]. Negotiated carve-outs remain revocable executive acts.

The multilateral route is equally constrained - India's complaint in DS547 ended in a mutually agreed solution in July 2023 with no ruling on merits [1]; the U.S. maintains such measures fall under the GATT Article XXI security exception, and a non-functional Appellate Body blunts enforcement.

Section 232 is thus a systemic feature of U.S. trade law, not a bargaining chip. India's durable response lies in moving up the value chain in specialty steel, diversifying through the UK and EU trade agreements, and building a plurilateral coalition to discipline the misuse of the security exception — while pursuing the Bilateral Trade Agreement for predictable, rules-based access.

(~315 words)

Sources: 1. WTO Dispute DS547 — United States: Certain Measures on Steel and Aluminium Products — India's challenge and the July 2023 mutually agreed solution 2. United States–India Joint Statement, February 7, 2026 (White House) — 18% reciprocal tariff, and Section 232 relief limited to certain aircraft and aircraft parts 3. Bureau of Industry and Security, U.S. Dept. of Commerce — Section 232 Steel and Aluminum — global application, derivative-product inclusions, and revocation of exclusions and country-level arrangements 4. Department of Commerce, Government of India — India's negotiating position and the Interim Agreement framework