US-India Tariffs: Why The Midterm Election May Not Change The Picture

Democrats may well win Congress on November 3, but Indian exporters should not expect relief from the result.

The tariffs on Indian goods rest on powers held by the US President, and most of them do not need Congress, according to a note by ICICI Bank's Economic Research Group.

Where Do Tariffs On India Stand?

In February, Donald Trump announced a deal cutting tariffs on Indian goods to 18% from 50%, in return for India lowering trade barriers and stopping Russian oil purchases. Then the legal ground shifted.

The ICICI note says the Supreme Court struck down the emergency-law (IEEPA) tariffs in February, and the temporary 10% global tariff expired in July.

Washington has since turned to other laws. Indian goods now face an extra 10% tariff under Section 301 of the Trade Act, imposed in July over forced-labour concerns.

A separate Section 301 probe into excess manufacturing capacity, which names India, is still open. A new Russia-sanctions law allowed duties of up to 100% on big buyers of Russian energy, but Trump waived them on October 16.

Secretary of State Marco Rubio says a trade deal with India is very close.

ALSO READ | Trump Eases Russian Oil Sanctions That Could Have Triggered 100% Tariffs On India

What Can Democrats Do?

The ICICI note puts the odds of a Democratic sweep at 63% and of Democrats winning only the House at 29%. In a sweep, it says, they could push bills to repeal selected tariffs, demand oversight of future ones and investigate their economic effects.

With only the House, they could hold hearings and introduce bills. The note says House Democratic leader Hakeem Jeffries' "first 100 hours" plan includes rolling back tariffs and clawing back Congress's trade powers from January 2027.

Why That May Not Be Enough

Trump can veto any repeal bill. Overriding a veto needs two-thirds of both chambers, which the note calls close to impossible for Democrats. It says even a simple Senate majority would be an uphill task.

Congress is also not needed for many tariffs. Sections 232 and 301 depend on agency investigations, not a vote. The note says the Section 301 tariffs on about 60 economies needed only a US Trade Representative investigation.

ALSO READ | 'Never Done Till It's Done': Jaishankar On India-US Trade Deal And Tariff Risks

Treasury Secretary Scott Bessent has argued that the administration keeps durable tariff powers.

What It Means For India

A Democratic Congress would more likely bring oversight, legal fights and uncertainty for businesses than a dismantled tariff system, the note says.

The big calls stay with the executive: the outcome of the Section 301 excess-capacity probe and any trade deal. Reports say the terms of a deal hinge on relief from Section 301.

The Russia-oil waiver also does not remove existing tariffs. For Indian exporters, the trade negotiators matter more than election night.