Container handling at Jawaharlal Nehru Port, Nhava Sheva — the kind of India-to-US export cargo that has moved through three different blanket-tariff regimes in thirteen months. Source: Wikimedia Commons, CC BY-SA 4.0.

"Tariff" is doing a lot of work in most 2025–2026 coverage of US-India trade, because two legally distinct mechanisms are both live at once and both get called by the same word.

Antidumping and countervailing duties (AD/CVD) are the older mechanism, administered jointly by two agencies with different jobs: the US International Trade Commission (USITC) determines whether a domestic industry is being materially injured, and the Department of Commerce determines whether the imported goods are being sold below fair value (dumping) or benefiting from a foreign government subsidy (countervailing). Both a domestic petition and a simultaneous filing at both agencies start the clock. USITC's preliminary injury phase must finish within 45 days of the petition; its final phase takes another 45–75 days. Only if both agencies reach affirmative findings does Commerce issue an AD or CVD order directing US Customs and Border Protection (CBP) to start collecting the duty — and the resulting rate is typically set per named foreign producer or exporter, not per country, so two companies making the same product in the same country can carry different duty rates depending on their own pricing and subsidy history in Commerce's investigation.

The blanket tariff on India is a different animal entirely: an executive-branch tariff stacking a country-of-origin duty on top of ordinary customs tariffs, with no USITC injury finding, no per-company rate, and no Commerce dumping calculation involved. It is closer to a foreign-policy or macroeconomic instrument than a trade remedy — and, as Section 3 traces in detail, the administration has reached for three different statutory bases for it in thirteen months (the International Emergency Economic Powers Act, then Section 122 of the Trade Act of 1974, then Section 301), because courts kept finding problems with whichever one it was using at the time.

The World Trade Organization's own Tariff Analysis Online resource, which aggregates every member country's committed tariff schedule, makes the legal asymmetry between these two mechanisms explicit in a way that's easy to miss from the US side alone. Every WTO member, the US included, has a bound tariff ceiling for each product line — the maximum rate it agreed to when it joined the WTO or in a later negotiating round — and an applied tariff, the rate it actually charges day to day, which is normally at or below the bound ceiling. Raising an applied rate above the bound ceiling is, by default, a breach of a WTO member's own commitments. GATT Article VI is the specific, named exception: it is what makes antidumping and countervailing measures lawful under WTO rules in the first place, provided they follow the injury-and-dumping-or-subsidy process AD/CVD actually uses. Nothing in GATT gives equivalent standing to a blanket, unilateral, country-of-origin surcharge imposed by executive action outside that process — which is a large part of why, as reported at the time, "some or even many WTO members" were expected to file WTO disputes over the April 2025 tariffs, even as US domestic courts moved faster and reached similar conclusions on separate, US-constitutional grounds. AD/CVD's durability across this whole episode isn't a coincidence: it's the one mechanism actually built for the job by treaty design, while every blanket-tariff vehicle tried since has been an attempt to reach a similar economic outcome through a legal side door.

The two mechanisms don't share a legal basis, a timeline, an appeals path, or even a government office in the driver's seat — which is exactly why a company can face both at once on the very same shipment, addressed through completely different channels, and why "India's tariff" as a single number is close to meaningless without saying which of the two is being discussed, and as of which date.

Independent of whichever blanket tariff happens to be in force, the US has a running, sector-by-sector caseload of AD/CVD orders and reviews against Indian goods — some severe, most modest, nearly all reviewed and re-set annually rather than fixed once and forgotten. None of this table changed when the Supreme Court struck down the IEEPA tariffs in February 2026, and none of it will change if Section 301 is challenged in turn: AD/CVD runs under the Tariff Act of 1930, a different statute entirely, administered by different agencies, and untouched by any of the litigation in Section 3 below.

Compiled from Federal Register notices and trade-press coverage of the same Commerce/USITC determinations (Federal Register, SeafoodSource, Southern Shrimp Alliance, PV Tech, GKToday, Saurenergy), cross-checked against KPMG India's own reference list in "U.S. Tariff Shifts" (September 2025), which this piece was able to read directly; USITC's own AD/CVD process page and CBP's AD/CVD priority-issue page, by contrast, were reached only through search-engine summaries, since usitc.gov and cbp.gov both returned blocked-egress errors on direct fetch.

The solar figure is the outlier worth sitting with: a combined AD+CVD burden north of 230% on a single sector is not a competitiveness tax, it is close to a prohibition — consistent with what an antidumping order is legally supposed to do when Commerce and USITC find severe enough dumping and injury. The shrimp numbers, by contrast, sit in single digits and shift by a percentage point or two most years as new administrative-review results land; that is AD/CVD working as a routine, ongoing cost-of-doing-business adjustment rather than a market-closing event.

Enforcement risk sits underneath all of it. CBP's Enforce and Protect Act (EAPA) program — its main tool against AD/CVD evasion via transshipment, misclassification, undervaluation, or misrepresenting the actual manufacturer — recovered more than $1 billion in evaded duties in 2026, about 300% above the program's historical annual average, the largest figure in the program's ten-year history. One live 2026 case, on solar modules routed to disguise their true origin, resulted in CBP-imposed cash-deposit rates as high as 271% (Vietnam) and 239% (China-wide) once evasion was confirmed — higher than the original order itself in both cases, which is the deliberate design of the penalty: get caught evading an AD/CVD order, and the rate that follows is worse than simply having paid it.

The blanket tariff arrived in two steps and left in two more. On 2 April 2025, the US declared a national economic emergency over its trade deficit and initiated "reciprocal" tariffs under IEEPA; a diplomatic pause followed, later extended through July, before revised tariffs took effect from 1 August 2025. On 6 August 2025, a second executive order added a further 25% ad valorem duty specifically on Indian goods, framed explicitly as a penalty for India's continued Russian oil purchases; that additional duty took effect 27 August 2025, bringing the cumulative rate on most Indian goods to 50%. Pharmaceuticals, semiconductors, critical minerals, certain energy products and select electronics were carved out and stayed exempt throughout — protecting India's higher-value, strategically sensitive exports while leaving labor-intensive sectors (apparel, home textiles, gems and jewelry, footwear, toys) fully exposed to the full 50% for the next several months.

Two details from KPMG's own contemporaneous account sharpen the August 2025 picture. First, the reciprocal-tariff order didn't just set country rates: it added a separate 40% tariff on transshipped goods specifically to deter routing shipments through a third country to dodge the real one — a blanket anti-evasion surcharge baked into the order itself, distinct from the CBP EAPA enforcement action described in Section 2, which investigates transshipment case by case after the fact rather than taxing it upfront. Second, India was not purely on the receiving end even then: in April 2025, India itself imposed a 12% safeguard duty against Chinese steel it expected to be redirected into the Indian market once US demand for that steel softened, and in July 2025 India formally notified the WTO under Article 12.5 of the Agreement on Safeguards of its intent to suspend equivalent concessions against the US in response to Washington's own safeguard tariffs on auto components — the same GATT-sanctioned retaliatory mechanism, used by India against the US, that Section 1 describes the US using against dumped and subsidized imports generally.

KPMG's analysis also sized which of India's export sectors actually sat in the blast radius, and how much of the whole economy that really was. Their table below, using Ministry of Commerce and Trade Map data for FY25, ranks sectors by how exposed each one was to the US market at the point the 50% tariff hit.

Source: KPMG India, "U.S. Tariff Shifts" (September 2025), citing India's Ministry of Commerce and Industry and the International Trade Centre's Trade Map, both accessed by KPMG in August 2025. "Share of US in India's exports" is each sector's own export book; "share of India in US imports" is India's slice of that product category's total US import demand — the two answer different questions and shouldn't be read as the same number.

Smartphones and pharmaceuticals top the list by how dependent the sector itself is on the US buyer (42% and 40% of each sector's exports), while gems and jewellery is where India is most exposed on the US side of the ledger (13.3% of all US import demand for that category) — and both of the pharma and smartphone rows sat, for the whole of this period, inside the exempted-goods list described above, which is a real qualifier on how much of this table's top line actually felt the 50% rate directly. Zooming out further, the exposure was real but not economy-defining: a government-cited report put India's total export loss from the higher tariffs at just 0.3–0.4% of GDP, since the US accounts for only about 2% of India's GDP even as it's one of India's largest single-country export destinations — the kind of proportionality check that belongs next to any of the sector-level percentages above, not instead of them.

The Russia-oil penalty portion was rescinded on 7 February 2026. Then, on 20 February 2026, the US Supreme Court ruled in Learning Resources, Inc. v. Trump that IEEPA never authorized the president to impose tariffs of this kind at all — not just India's penalty, but the entire April 2025 reciprocal-tariff program, plus related fentanyl-linked tariffs on China, Canada and Mexico. The ruling didn't just stop future collection; it held the tariffs were invalid as imposed, opening the door to an estimated $175 billion in refund claims across every company that had paid them. Walmart alone received a $2.9 billion refund, which it said it was using to fund price cuts.

The administration moved fast to replace what the Court had removed. Within days it invoked Section 122 of the Trade Act of 1974 — a narrower, older authority meant for genuine balance-of-payments emergencies, capped by statute at a 15% surcharge for at most 150 days without congressional extension — imposing a flat 10% global tariff on 22 February 2026 (raised to 15% the same week). The Court of International Trade rejected this tool too, on 7 May 2026, though it stayed in effect pending appeal. It didn't need to be struck down a second time: Section 122's own 150-day clock ran out, and the tariff expired automatically at 12:01am on 24 July 2026.

The same day it expired, the administration had a third mechanism ready. USTR finalized Section 301 tariffs stemming from forced-labor investigations into 60 economies, including India, effective 24 July 2026 — a longer-standing, more procedurally involved statute than either IEEPA or Section 122, and not an emergency power at all. India's final rate came in at 10%, down from a proposed 12.5% after India amended its Foreign Trade Policy to address the forced-labor findings; India's commerce ministry says the duty applies to 60–65% of Indian exports, with 45% exempt. That 10% is what's actually in force today, and it's what the chart above shows.

Set the two moments side by side: in August 2025, India's blanket tariff (50%) was 2.5–3.3x Vietnam, Bangladesh, Thailand and Turkey's (15–20%, on the same-era IEEPA schedule). Today, India's Section 301 rate (10%) matches Bangladesh's and sits below Vietnam, Thailand and Turkey's (12.5% each). The competitive disadvantage that drove the sourcing decisions in Section 4 below was real when it happened — it just no longer describes the present.

Walmart is the cleanest case study because its numbers are public and its reactions, at every stage of the last thirteen months, were fast. The company's imports from India rose from about 2% of its US-bound goods in 2018 to roughly 25% in the January–August 2023 window, part of a publicly reaffirmed commitment to source $10 billion a year of India-made goods by 2027 (up from an estimated $3 billion at the time of reaffirmation) — concentrated in apparel, home textiles, toys, footwear, food and consumables. Over the same stretch, China's share of Walmart's US imports fell from about 80% to roughly 60%, an explicit supply-chain diversification move Walmart's own sourcing leadership has attributed to resilience against tariffs, geopolitical tension and disaster risk alike, not solely to India-specific advantages.

When the 50% tariff took effect in late August 2025, Walmart paused new orders from Indian suppliers, alongside Amazon, Target and Gap, rather than absorb the added cost into its own margins — and where existing orders continued, retailers pushed the incremental tariff cost back onto suppliers through renegotiated FOB pricing, according to trade-press reporting on supplier communications at the time. Analysts cited in that reporting estimated the tariff would raise Indian exporters' landed costs by 30–35% and could cut US-bound order volume by 40–50%, worth an estimated $4–5 billion to India's textile sector alone — an analyst projection at the time, not a measured outcome, and this piece did not locate later trade data confirming or disproving it.

The rest of the timeline in Section 3 landed on Walmart too, just less visibly. Once the Supreme Court's February 2026 ruling opened refund claims on the invalidated IEEPA tariffs, Walmart received $2.9 billion back and said it was directing the money toward price cuts for shoppers — real money returned specifically because the 50% rate the company reacted to in August 2025 was, per the Court, never lawfully imposed in the first place. And since 24 July 2026, the rate actually governing new India orders is the 10% Section 301 duty from Section 3, not 50%. What this piece could not find in available reporting is whether Walmart has since resumed or expanded India orders now that the tariff gap against Vietnam and Bangladesh has closed; that is presented here as an open question, not an assumed "yes."

The mechanism that makes any of this specifically Walmart's legal and financial problem, not just its suppliers', is importer-of-record liability — the same principle that runs through AD/CVD process guides aimed at importers (Roanoke's whitepaper and Purolator's explainer both center on it, though this piece could not fetch either page directly and draws on how their content is described in search results and other coverage of the same guidance). Whoever is named as importer of record at the US border, not the foreign manufacturer, is who CBP holds responsible for correct tariff classification, accurate valuation, truthful country-of-origin declaration, and timely duty payment — and for AD/CVD-covered goods specifically, that liability can be retroactive: a shipment can clear at a preliminary rate and get revised upward, sometimes substantially, once an annual administrative review finalizes months or years later. A company the size of Walmart, moving that volume of Indian-origin goods, cannot simply renegotiate its way out of that legal exposure the way it can renegotiate a supplier's FOB price — which is precisely why "stop ordering" was the fastest lever available in August 2025, and why "claim the refund" was the fastest lever available once the Court ruled the rate had never been valid.

Standard tariff-mitigation guidance for importers — NetSuite's list of strategies is one widely-cited example, though this piece could not fetch the page itself directly — typically centers on tools like the First Sale Rule (basing duty on the earlier, lower manufacturer-to-middleman price rather than the price the importer pays), duty drawback (reclaiming up to roughly 99% of duties paid on goods later re-exported or destroyed), foreign trade zones and bonded warehouses (deferring or reducing duty by controlling when and on what value it is assessed), and tariff engineering (legally altering a product or its stage of assembly so it lands in a different, lower-duty classification — the often-cited example being footwear modified with a felt sole to be reclassified as slippers, cutting the applicable rate from roughly 40% to 3%).

Almost none of that toolkit addresses a blanket, country-of-origin tariff the way it addresses an ordinary classification-based duty. First Sale reduces the base a percentage is calculated against, but an ad valorem tariff still applies to whatever that base is — it shrinks the bill somewhat, not the underlying exposure. Duty drawback only helps for goods re-exported, not sold into the US retail market Walmart is actually serving. Foreign trade zones and bonded warehouses optimize the timing and valuation basis of duty payment, not which country's tariff schedule applies. None of these tools can change where a product was made, which is the entire trigger for a country-of-origin rate, whichever statute currently sets it.

The one lever that structurally fits is sourcing diversification — exactly what Walmart, Amazon, Target and Gap were reported doing when the gap was 30 percentage points wide in August 2025: shifting order volume toward Vietnam and Bangladesh, where the tariff schedule at the time made the same product meaningfully cheaper to land. That calculus has since inverted, per Section 3 — India's current 10% Section 301 rate matches Bangladesh's and beats Vietnam, Thailand and Turkey's 12.5% — which means the same diversification logic that argued for leaving India in 2025 now argues, if anything, for staying or returning, at least on tariff grounds alone (sourcing decisions obviously weigh far more than one input cost, and switching supply chains back is neither instant nor free). And there is a second, AD/CVD-specific lever the general mitigation guides don't cover, because AD/CVD rates are assigned per named exporter rather than per country: an importer can shift purchase volume toward whichever specific Indian producer carries the lowest individually-assigned margin — visible in the shrimp case above, where named exporters carry a 2.71% collective rate against a 3.76% rate for the roughly 99 other Indian exporters not individually investigated.

The boundary that matters here is the one between legal tariff engineering and prosecutable evasion. Modifying a product's actual manufacturing process or assembly location to legitimately change its country of origin is the lawful version of "changing where it's made." Relabeling Indian-origin goods as Vietnamese or Bangladeshi without any real transformation is transshipment fraud — precisely what CBP's EAPA enforcement, with its $1 billion-plus 2026 recovery and evasion-case cash-deposit rates exceeding 270% described in Section 2, exists to catch. A company with Walmart's scale, audit exposure and regulatory visibility has essentially no room to be anywhere near that boundary, which is one more reason "pause and diversify" reads as the safer institutional choice over any of the more surgical workarounds.

It's tempting to read the 50% wall as something India alone triggered by buying Russian oil. Canada's parallel experience argues otherwise. Talks toward a new US-Canada trade deal collapsed on 21 August 2026 — not a deal reached, a deal that fell apart in its final hours, according to both governments' own accounts. The US had reportedly offered to cut steel and aluminum tariffs in half and substantially reduce auto and softwood-lumber tariffs in exchange for a broader "economic and national security partnership"; Canada's finance ministry said the final terms amounted to "asking too much…and offering too little," including demands to curtail Canada's ability to negotiate trade deals with other countries. The US responded by imposing Section 338 tariffs of 50% ad valorem on roughly $20 billion of Canadian goods — dairy, alcohol, cement, hockey equipment among them — effective in the following days, on top of a separate 10% tariff that took effect 24 July 2026 on countries, Canada included, that a US Trade Representative investigation found were not adequately enforcing bans on forced-labor imports. Canada counter-retaliated on 8 September 2026 with its own tariffs on roughly C$27.6 billion (about US$22 billion) of American goods, doubling its existing steel and aluminum counter-tariffs from 25% to 50% to match the US rate dollar-for-dollar.

None of that is AD/CVD — and tellingly, none of it is IEEPA either. By August 2026, IEEPA tariff authority was already off the table, struck down by the Supreme Court six months earlier (Section 3); Section 338 of the Trade Act of 1930 is a different, older statute again, aimed this time at a treaty partner inside the USMCA framework the US itself declined to renew in its current form. That's the same pattern as India's own sequence one statute further along: when one blanket-tariff vehicle is closed off by the courts, the administration has consistently reached for a different one rather than abandoning the underlying policy goal. What makes Canada the clean control case is that its decades-old AD/CVD track is running at the same time, on its own separate clock, and moving in the opposite direction: Commerce's own October 2026 final review of Canadian softwood lumber duties is expected to cut the combined antidumping-plus-countervailing rate from about 35.16% to about 24.83% (AD alone from 20.56% to 10.66%, CVD from 14.63% to 14.17%). Even with that relief, total lumber-duty exposure is reported near 34.83% once a separate 10% Section 232 tariff (imposed October 2025) is stacked back on top — the same layering pattern as India's solar case, just with a falling AD/CVD line offset by a rising blanket-tariff line instead of two rising lines at once.

The comparison sharpens the piece's core point rather than complicating it: blanket, executive-ordered tariffs are being used as a general-purpose lever — a Russia-oil penalty against India, a USMCA-renegotiation lever against a treaty ally in Canada — while AD/CVD keeps running underneath as its own, slower, quasi-judicial process, on its own timeline, sometimes moving the opposite way from the headline tariff war layered on top of it.

As of this writing (12 September 2026), no new US-Canada deal has actually been signed — the dispute remains live. President Trump said that day a deal could come "fairly soon," while blaming Canada for a decades-long trade imbalance and pointing to Canadian tariffs on US agricultural goods as a sticking point; Canada's own account of why the 21 August talks collapsed centers instead on US demands over Canadian industrial and tariff policy going beyond what Ottawa was willing to concede. Both sides are, in other words, still blaming each other publicly rather than describing terms they've agreed to. On the ground, the dispute has visibly reshaped retail shelves on the Canadian side, with reported consumer boycotts of US goods and a "Buy Canadian" push changing what independent grocers stock. The pattern worth flagging for India's own case: a blanket tariff dispute of this kind does not resolve on a fixed timeline or through a trade-law process with defined phases the way AD/CVD does — it resolves whenever (and however) the underlying political negotiation does, which as Canada's case shows can mean staying unresolved for weeks past the tariffs actually taking effect.