America is returning tariff money
After a major decision of the Supreme Court in America, a huge refund process of $166 billion has started. This money is being returned to those American importers who had paid the huge tariffs imposed by Donald Trump. If seen from India’s perspective, about 10 to 12 billion dollars of this refund is directly related to Indian goods. But the catch is that this money will not easily come into the pockets of Indian exporters. According to a recent report by the Global Trade Research Initiative (GTRI), getting a tax refund is not so straightforward. Let us understand what impact this entire process is going to have on Indian business and supply chain.
The door to refund opened, but who has the key?
US Customs and Border Protection launched a new digital platform called ‘CAPE’ on April 20, from where refund claims can be made. In fact, on February 20, 2026, the US Supreme Court declared the Trump tariffs illegal, which were implemented under the International Emergency Economic Powers Act (IEEPA).
According to the rules, only those American companies have a legal right to this refund, which had paid this duty at the time of import. The refund will also include interest and will be received within 60 to 90 days. This means that Indian exporters have no legal right to claim this money directly. Indian companies will get the benefit of this refund only if they negotiate with their American buyers and reach a strong commercial agreement.
Tariff shock had reached 50 percent
This tariff structure of Trump had increased very rapidly. When it came into effect on April 2, 2025, the duty on Indian goods was 10 percent. After this, on August 7, it reached the record level of 25 percent and by August 28, it reached 50 percent. It was reduced to 18 percent in early February 2026, but a few weeks later the Supreme Court rejected this entire structure.
When these heavy tariffs were in force, Indian companies had to suffer huge losses to survive in the market. Many companies reduced their profit margins, while some absorbed this cost shock by changing contract terms.
10-12 billion dollars at stake, which sectors will benefit?
According to GTRI report, about 53 percent of exports from India to America were directly affected by these heavy tariffs. In this, labour-intensive sectors like textile and apparel suffered the most loss. It is estimated that out of the total refunds related to India, about $4 billion is from the textile sector alone. Apart from this, $4 billion of engineering goods and about $2 billion of chemicals are part of this refund process. The remaining part is divided into other small and big categories.
What will Indian companies have to do?
For Indian exporters, this is no longer a matter of policy support but a ‘business deal’ issue. Companies that had contracts on a duty-paid basis now have an excellent opportunity to renegotiate with American buyers.
Exporters will now have to work on options like partial rebate-sharing, revision of prices, issuing credit notes or adjusting this remaining money in future orders. In this process, organizations like Apparel Export Promotion Council (AEPC), Engineering Export Promotion Council (EEPC) and Chemexcil can show the right direction to Indian companies.
Also read- Despite tension, 10 Indian ships passed through Hormuz, government gave information
