India has received a refund of ₹1 lakh crore due to the cancellation of illegal tariffs in the US. This is a major opportunity for sectors like textiles and engineering, but due to legal complications, the funds will not be directly transferred to Indian companies. Learn how negotiations will determine exporters' profits.
A landmark ruling by the US Supreme Court has raised hopes for Indian exporters. The repeal of import duties imposed during the Trump administration has initiated the process for refunds totaling approximately $166 billion. India's share of this is estimated to be approximately $10 to $12 billion. However, this money will not directly go to Indian companies; instead, they will have to negotiate hard with American buyers.
Supreme Court decision
On February 20, 2026, the US Supreme Court declared the tariffs imposed by the Trump administration illegal. According to the court, these tariffs were imposed without legal authority. Subsequently, applications for refunds began on the digital platform CAPE on April 20. These refunds apply for tariffs levied between April 2025 and February 2026, during which time the duty on India increased from 10% to 50%.
These sectors will benefit the most
According to a GTRI report, approximately 53% of India's total exports were affected by these tariffs. The textile and apparel industry is expected to benefit the most, with a refund of approximately $4 billion. Additionally, refunds of $4 billion are estimated for engineering goods and $2 billion for the chemical sector.
Big challenge before Indian companies
The full refund will only go to US importers who paid the tax. Indian exporters will not receive any money directly. To benefit, Indian companies will have to negotiate with their US buyers. Companies that saw their margins reduced due to the duty burden can now claim their share through credit notes or discounts on future contracts.
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