The US Supreme Court is set to potentially rule today, January 9, 2026, on the legality of President Donald Trump’s expansive tariffs imposed via executive order on April 2, 2025, dubbed “Liberation Day” tariffs, which include a baseline 10% on most imports and higher rates up to 50% on countries like India, China, Canada, and Mexico. These measures, enacted under the 1977 International Emergency Economic Powers Act (IEEPA) for national emergencies like trade deficits and fentanyl trafficking, face challenges from over 900 lawsuits by businesses and states seeking up to 150 billion dollar in refunds. Justices from both sides expressed doubts during November 2025 arguments about the broad use of presidential authority without congressional oversight.
A ruling against the tariffs could strike them down entirely or partially, limiting IEEPA’s scope and forcing refunds, while upholding them would affirm expansive executive trade powers, setting precedent for future presidents. Trump warned on social media that an adverse decision would deliver a “terrible blow” to US interests, amid US tariff rates exceeding 15% by late 2025. Markets brace for volatility, with prediction markets and analysts eyeing outcomes that could reshape global supply chains.
For India, the stakes are high as one of the hardest-hit nations under the 50% reciprocal duties, affecting export competitiveness in a fragile global economy. Nearly 10% of India’s US exports, valued at 8.3 billion dollar, target Section 232 national security levies on steel, aluminum, autos, timber, copper, and machinery, untouched by this ruling and already burdening sectors where the US takes 22.7% of India’s shipments. A court strike-down offers relief, potentially rallying Sensex and Nifty through lower costs and boosted orders in textiles, handlooms, and pharma, but persistence threatens growth, inflation from energy imports, and trade balances.
Broader risks loom if Congress advances a bipartisan bill imposing 500% tariffs on Russian energy-reliant nations like India, hitting over 50 billion dollar or two-thirds of exports, amplifying labor-intensive sector pain. Indian exporters face sustained vulnerability, urging diversification and policy hedges amid US-India trade talks. Equity markets could surge on a pro-India verdict but deepen volatility otherwise, per experts like Vijayakumar.
This decision tests the balance of US trade power, with India watching for cues on FDI, supply chains, and retaliatory measures in an interconnected world.