The US Supreme Court ruling puts the US-China trade agreement at risk, with the opposition calling for a suspension.

LootboxPhobia · 2026-02-21T10:56:02+00:00

The U.S. Supreme Court has ruled that Trump's tariff system is invalid, leading to chaos in India's trade situation. The opposition party has called for suspending the trade framework with the United States and renegotiating. Meanwhile, the Modi government is shifting its focus to artificial intelligence, striving to make India a global "affordable AI" hub to meet the challenges of traditional trade.

LootboxPhobia

2026-02-21 10:56:02

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Investing.com – After the U.S. Supreme Court ruled that President Trump’s recent tariffs are invalid, India’s trade landscape has become chaotic. Led by Congress Party’s Jairam Ramesh, the Indian opposition now demands that Prime Minister Narendra Modi’s government suspend the current India-U.S. trade framework. The opposition argues that legal changes in Washington require a comprehensive renegotiation.

Under the previous provisional agreement, India received a tariff reduction from 25% to 18% and the removal of punitive tariffs. However, as the Supreme Court overturned these specific tariffs, Trump shifted to implementing a 10% global uniform tariff, and India’s achieved “reciprocal” advantage has essentially disappeared. Ajay Sahai of the Federation of Indian Export Organizations pointed out that while a “fair competitive environment” has been restored, the special agreements India signed are now effectively outdated.

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India Seeks to Establish “Affordable AI” Hub Amid Trade Tensions

As trade tensions escalate, Prime Minister Modi is doubling down on technology as the country’s main growth engine. At a high-profile summit held this month in New Delhi, Modi outlined India’s global ambitions, positioning the country as a leading center for “affordable AI” worldwide. The Prime Minister is leveraging India’s large software talent pool and vast datasets to argue that the country can deliver AI solutions at a fraction of Western competitors’ costs.

After a challenging year for the government, this push to dominate AI marks a strategic shift: if traditional commodity trade is hindered by U.S. tariff changes, India plans to lead in the digital economy. By focusing on AI democratization and building “AI for all,” the government aims to attract global investment and solidify India’s status as a tech superpower, even as its traditional trade agreements face mandatory “restarts.”

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