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Trump order announces rollback of 25% additional tariffs: What it says India has ‘committed to’

February 07, 2026 4 min read Economics International Relations GS Paper II GS Paper III
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What Happened

  • President Trump signed an Executive Order on 6 February 2026 suspending Executive Order 14329, which had imposed an additional 25% tariff on all Indian imports since August 2025 over India's purchase of Russian oil.
  • The tariff rollback became effective on 7 February 2026 (12:01 a.m. EST), immediately removing the 25% penalty layer.
  • Separately, the US will reduce the reciprocal tariff rate on Indian goods from 25% to 18%, bringing the total effective tariff down from 50% to 18%.
  • The Executive Order states that India has "committed to stop directly or indirectly importing Russian Federation oil" and "has represented that it will purchase United States energy products."
  • India also committed to a framework for expanding defence cooperation with the US over the next 10 years and to purchasing $500 billion worth of US products over five years.

Static Topic Bridges

The International Emergency Economic Powers Act (IEEPA), enacted in 1977, authorises the US President to regulate international commerce after declaring a national emergency in response to an unusual and extraordinary threat with a foreign source. The Trump administration used IEEPA as the legal basis for imposing both the Russia-related 25% penalty tariff and the reciprocal tariffs on India.

  • IEEPA was enacted in 1977 to replace and limit the broader powers under the Trading with the Enemy Act (TWEA) of 1917
  • The Act requires the President to declare a national emergency under the National Emergencies Act (NEA) before invoking IEEPA powers
  • IEEPA emergencies must be renewed annually to remain in effect
  • No President had previously used IEEPA to impose tariffs until the Trump administration; the legal authority to do so is contested
  • The closest precedent was President Nixon's use of the similarly worded TWEA in 1971 to impose a 10% tariff on all imports during a monetary crisis
  • Multiple legal challenges have been filed questioning whether IEEPA's "regulate" power extends to imposing tariffs

Connection to this news: The Executive Order suspending EO 14329 demonstrates how IEEPA-based tariffs can be imposed and removed rapidly through presidential action, without requiring Congressional approval, giving the executive branch significant leverage in bilateral trade negotiations.

US Reciprocal Tariff Policy: The New Trade Architecture

The Trump administration introduced a "reciprocal tariff" framework that aims to match the tariff rates that other countries impose on US goods. This represents a departure from the post-World War II multilateral trading order built on Most Favoured Nation (MFN) principles and progressive tariff reduction through WTO negotiations.

  • Reciprocal tariffs were announced in April 2025 with country-specific rates calculated based on trade deficit ratios
  • India was initially assigned a 25% reciprocal tariff rate, which subsequently increased to 50% with the Russia-related penalty
  • The new framework reduces India's rate to 18%, positioning it as one of the lower reciprocal rates among major economies
  • Other reciprocal tariff rates for comparison: China 30%, EU 20%, Japan 10%, South Korea 14%, Vietnam 20%
  • The "Potential Tariff Adjustments for Aligned Partners" annex identifies specific goods eligible for zero tariffs as a reward for alignment with US interests

Connection to this news: India's reduction from 50% to 18% reflects a negotiated outcome where India made specific commitments (Russian oil, $500 billion purchases, defence cooperation) in exchange for tariff relief, establishing a transactional model for bilateral trade relations.

Executive Orders as Trade Policy Instruments

Executive Orders are directives issued by the US President that manage operations of the federal government. In trade policy, they have become increasingly significant tools for rapid tariff adjustments, bypassing the slower Congressional legislative process.

  • The US Constitution grants Congress the power to regulate foreign commerce (Article I, Section 8), but various statutes have delegated tariff authority to the President
  • Key delegating statutes: IEEPA (1977), Trade Expansion Act Section 232 (1962), Trade Act Section 301 (1974)
  • Executive Orders on trade can take effect immediately, as seen with the 7 February 2026 effective date
  • EO 14329 (August 2025) imposed the 25% Russia-related tariff; the February 2026 EO suspended it — both without Congressional vote
  • The rapid imposition and removal cycle creates policy uncertainty for importers and exporters, affecting supply chain planning

Connection to this news: The Executive Order mechanism allowed the US to impose a punitive tariff over Russian oil purchases and then remove it within six months as a concession in trade negotiations, demonstrating how executive trade actions can function as both coercive tools and diplomatic bargaining chips.

Key Facts & Data

  • EO 14329 imposed 25% Russia-related tariff on India: effective 27 August 2025
  • Suspension EO signed: 6 February 2026; effective 7 February 2026 (12:01 a.m. EST)
  • Total tariff reduction: 50% to 18% (25% Russia penalty removed + reciprocal tariff cut from 25% to 18%)
  • India's commitments: stop Russian oil imports, purchase $500 billion US products over 5 years, expand 10-year defence cooperation framework
  • IEEPA enacted: 1977, replacing TWEA of 1917
  • Reciprocal tariff rates of other countries: China 30%, EU 20%, Japan 10%, Vietnam 20%
  • The Executive Order published in Federal Register: 11 February 2026