Published On: Thu, May 29th, 2025

Tariff policy: Trade access helped halt Indo-Pak war, US govt tells court


The United States government has told a court that any ruling impeding President Donald Trump’s use of emergency powers to invoke tariffs would imperil foreign policy arrangements across the world, including the May 10 ceasefire between India and Pakistan that it said was “achieved only after” both nations were offered “trading access with the US to avert a full-scale war”.

US President Donald Trump holds a chart next to US Secretary of Commerce Howard Lutnick as Trump delivers remarks on tariffs in the Rose Garden at the White House in Washington, D.C., U.S., on April 2 (REUTERS)
US President Donald Trump holds a chart next to US Secretary of Commerce Howard Lutnick as Trump delivers remarks on tariffs in the Rose Garden at the White House in Washington, D.C., U.S., on April 2 (REUTERS)

US secretary of commerce Howard W Lutnick made the submission on May 23, in a lawsuit filed by attorneys general of 12 Democrat-ruled states against Trump and a clutch of US departments in the US Court of International Trade. The states argued that the President’s use of the International Emergency Economic Powers Act (IEEPA) to slap steep tariffs on dozens of nations, including a 26% levy on Indian imports, was unlawful and arbitrary.

Lutnick, in his submission, said that a ruling restricting IEEPA would “have ripple effects across every domain in which economic instruments are used for strategic effect”.

“For example, India and Pakistan two nuclear powers engaged in combat operations just 13 days ago reached a tenuous ceasefire on May 10, 2025. This ceasefire was only achieved after President Trump interceded and offered both nations trading access with the United States to avert a full-scale war,” he said.

“An adverse ruling that constrains presidential power in this case could lead India and Pakistan to question the validity of President Trump’s offer, threatening the security of an entire region and the lives of millions,” he added.

To be sure, India has rejected claims by Trump and a raft of his cabinet members that the US mediated the truce, reached after four days of military conflict between the two neighbours, saying a halt in hostilities was achieved by direct talks between military officials of the two nations. India struck terror bases in Pakistan and Pakistan-occupied Kashmir early on May 7 in a first volley of attacks as part of Operation Sindoor.

The Trump administration paused the reciprocal tariffs that were announced on April 2 till July 9, leaving a 10% baseline levy in place as countries scrambled to stitch up trade pacts with the world’s largest economy.

Lutnick also claimed that Trump’s tariffs helped bring China – which the US blames for an influx of drugs into the country and for pulling away its manufacturing jobs – “to the negotiating table”.

The US had imposed cumulative tariffs of 145% against Chinese imports. The country responded by slapping levies of 125% against US-made products. The two eventually reached a temporary compromise earlier this month, with both sides dialling back tariffs as part of a 90-day pause.

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