NEW DELHI: US President Donald Trump has imposed a steep duty of about 126% on certain solar imports from India, reopening friction with New Delhi just as both sides were trying to advance a bilateral trade deal.
The preliminary countervailing duty, announced by the US Commerce Department, covers crystalline silicon photovoltaic cells and modules. Washington said Indian manufacturers benefited from subsidies that allowed them to undercut American producers.
The move comes only weeks after the two sides agreed on a framework to reduce tariffs on Indian exports to about 18%, from roughly 50% earlier, as part of talks on an interim trade arrangement. Officials had planned a three-day meeting this week to push negotiations forward, but that has now been postponed.
The latest action underscores Trump’s protectionist trade stance even as negotiations continue. It also comes on top of the administration’s new 10% baseline tariff on imports from most countries, with the possibility of higher rates later.
US authorities say imports from India, Indonesia and Laos — accounting for about 57% of American solar module imports in the first half of 2025 — surged as manufacturers shifted production to bypass earlier restrictions tied to Chinese supply chains. India has been a key beneficiary of that shift.
Trade data show solar imports from India rising sharply to $792.6 million in 2024 from $83.86 million in 2022. US industry groups welcomed the duty, arguing domestic investment would suffer if subsidised imports dominated the market.
For Indian manufacturers, the move could tighten access to a fast-growing export market and add pressure at home. India’s solar-module manufacturing capacity exceeds 160 GW, far above the domestic demand of about 40-45 GW, raising the risk of oversupply if exports slow.