US Warns Of New Tariff Action Under Section 301 Amid Trade Talks With India; What Does It Mean?

US Treasury Secretary Scott Bessent has warned that the United States may consider imposing additional tariffs under Section 301, depending on the results of ongoing trade investigations. His remarks come amid a period of active trade discussions between the US and India, as both countries work toward finalising the first phase of their Bilateral Trade Agreement (BTA).

What Is US Planning?

Bessent’s statement suggests that the US is still considering other ways to apply tariffs, especially after reports that the US Supreme Court ruled reciprocal tariffs as “illegal.” He indicated that existing tariff levels could change depending on the results of the Section 301 review.

Speaking to CNBC, Bessent said, “Right now, we have something called Section 122 tariffs, which is a 10 per cent global tariff. Currently, USTR ambassador Jamieson Greer, is doing studies for Section 301. And if those studies are successful... then the tariff rates are going to go back to exactly where they were.”

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He also added that President Donald Trump had used reciprocal tariffs last year as a negotiation tool to bring trading partners to the table and secure trade deals. Bessent’s remarks come at a time when India and the US are engaged in discussions to finalise a trade deal. US Trade Representative (USTR) Jamieson Greer visited New Delhi last week for talks, where he met Union Commerce Minister Piyush Goyal.

India-US Trade Deal

Both sides held two days of talks aimed at finalising the first phase of the India-US Bilateral Trade Agreement (BTA). Officials from both countries have said they are “very close” to reaching a deal. Meanwhile, speaking in London on Thursday, Goyal said that New Delhi wants to ensure it has a competitive advantage over its peers and cannot enter into the deal until that framework is finalised.

No Deal Without Competitive Tariff Benefits, Says Goyal

According to him, the most important issue in the current negotiations is ensuring that Indian products receive a better tariff status than their competitors in the global market. He said the US is considering legal and policy options that could give India a competitive advantage. “Until a framework is in place that gives Indian exporters a comparative tariff advantage over other competing countries, India will not sign a trade deal with the US,” the commerce minister said.

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What Is Section 301?

Started in March this year, the Section 301 investigation, has become an important part of the ongoing trade talks between India and the US. Notably, Section 301 of the US Trade Act of 1974 allows the Office of the USTR to investigate whether other countries’ trade policies are unfair and harmful to US trade interests.

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