Section 232 tariffs: US cuts rate to 15% on selected equipment; India gains limited, says GTRI

The US administration has said some tariffs on equipment containing steel, aluminium or copper will fall. The Global Trade Research Initiative said the rate drops from 25 per cent to 15 per cent. The change covers selected industrial and farm equipment. GTRI said the move brings only limited relief for India. The new rate applies between June 8, 2026 and December 31, 2027.

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Ajay Srivastava said the main metal duties still stay in place. Most imported steel, aluminium and copper articles will still face a 50 per cent tariff. Many downstream and derivative items made from these metals will keep a 25 per cent duty. GTRI said these unchanged rates limit the gains from the new 15 per cent category.

Section 232 tariffs: equipment covered and new tariff rates

GTRI said the 15 per cent rate may help exporters of engineering goods. It may also support HVAC equipment, electrical equipment and farm machinery exports. The covered list includes heating and air-conditioning equipment, bulldozers, forklifts and harvesters. It also includes agricultural machinery and some electrical grid equipment. The change targets products that contain steel, aluminium or copper.

GTRI said a fresh 10 per cent tariff category is also being added. It applies to imported products made using at least 85 per cent U.S.-origin steel, aluminium or copper by weight. Items with 15 per cent or less of these metals by weight will stay exempt. The exemption remains under Section 232 tariffs, the think tank said.

Section 232 tariffs: limited impact for India and US-origin metals

Srivastava said the overall impact for India is likely to be modest. Some Indian manufacturers may use U.S.-origin metals to qualify for the 10 per cent rate. India imported about USD 2.9 billion of steel, aluminium, copper and related products from the US in FY2026. That import base could help firms export finished products back to the US.

GTRI said the key constraint for India remains the same even after the cut. Indian exports of steel, aluminium and copper products will still face 50 per cent Section 232 tariffs. Many downstream metal products will also continue to face a 25 per cent duty. As a result, the 15 per cent equipment tariff cut offers only narrow benefits.

With inputs from PTI