India & China Among Winners After US Court Blocks Tariffs

India: The court’s decision removes Trump’s ability to deploy emergency tariffs with sweeping discretion under IEEPA. US Customs and Border Protection confirmed it will stop collecting IEEPA-related tariffs at 12:00 a.m. EST Tuesday and deactivate associated tariff codes.

Instead, the administration is pivoting to Section 122 of US trade law — a more structured and time-limited authority. While still significant, this mechanism lacks the instantaneous escalation capability that IEEPA offered.

Economists at Morgan Stanley suggested the legal reset may reduce some of the intense uncertainty that defined recent trade policy swings, arguing that peak tariff uncertainty may have already passed. Yet markets remain cautious. The US dollar and S&P 500 futures dipped as investors absorbed another shift in policy architecture.

India: Why the US Supreme Court Tariff Ruling Matters Globally

This is not a rollback of tariffs — it is a strategic reset.

The US Supreme Court Tariff Ruling curtails Trump’s ability to “dial up” tariffs in real time, especially against geopolitical rivals. That constraint could strengthen negotiating leverage for several countries, particularly China and India, at a delicate moment in global trade diplomacy.

With Trump planning a high-profile visit to Beijing, the legal shift narrows Washington’s most immediate pressure lever over China. Rather than facing targeted emergency tariffs, Beijing now confronts the same 15% global rate applied broadly — a meaningful change in negotiating dynamics.

Winners of the Tariff Reset

India: Leverage at the Negotiating Table

For New Delhi, the court’s intervention introduces both uncertainty and opportunity.

India had postponed a trade delegation trip to Washington aimed at finalizing an interim trade framework. Officials cited fresh tariff uncertainty emanating from the US as a key factor. Behind that delay lies strategy: India may now seek improved terms, recognizing that Washington’s rapid-escalation mechanism has been legally curtailed.

The US Supreme Court Tariff Ruling effectively grants India additional “elbow room” in negotiations — precisely when trade talks were approaching a critical phase.

China: Breathing Space Before High-Stakes Talks

China’s commerce ministry responded with measured language, stating it is conducting a “full assessment” while urging Washington to lift unilateral measures. It reiterated that cooperation benefits both sides, while confrontation harms mutual interests.

Markets responded swiftly. Chinese stocks listed in Hong Kong rose as investors priced in near-term relief.

The decision removes what Bloomberg described as one of Trump’s fastest pressure tools over China. Instead of facing potentially escalating emergency rates, Beijing now confronts the same flat 15% rate as US allies — narrowing the punitive gap.

Brazil, Canada, and Mexico: Mathematical Relief

According to analysis cited by the Financial Times, Brazil enjoys the largest average tariff reduction — down 13.6 percentage points — followed by China at 7.1 points.

Meanwhile, Canada and Mexico benefit from the elimination of fentanyl-related levies that had been tied to IEEPA orders. If USMCA exemptions remain intact, both countries could find themselves in a comparatively favorable trade position.

The political irony is stark: countries previously criticized most harshly by the White House have seen the steepest immediate relief.

Southeast Asian Exporters: Narrowing the Gap

Export-driven economies like Vietnam, Thailand, and Malaysia also benefit from the reset. Manufacturers in clothing, furniture, toys, and plastics now compete in a more level tariff environment.

However, the flat rate offers opportunity — not certainty. The 150-day limit introduces a ticking clock.

India: The Losers in the New Global Tariff Order

US Allies Who Negotiated Lower Rates

Countries like the United Kingdom and Australia had previously secured preferential 10% levies under earlier reciprocal arrangements. The new universal 15% tariff erases that advantage.

The UK, in particular, sees one of the sharpest relative increases, with its average tariff rate rising by over two percentage points under the new structure.

European Union and Japan: Strategic Disadvantage

The European Union faces a modest overall increase, but exposure is concentrated in key sectors and economies within the bloc.

Japan loses a subtler advantage: nations previously positioned at a competitive 15% are no longer differentiated once all exporters face the same rate.

European leaders are demanding predictability. European Commission officials emphasized that trade commitments must be honored, warning that renewed volatility could disrupt business planning.

Meanwhile, European Central Bank President Christine Lagarde cautioned that renewed upheaval would undermine corporate clarity, stressing that businesses need stability — not recurring shocks.