The headline rate that dominated 2025 coverage of Indian textiles, a combined 50 per cent US tariff, is no longer being collected. What replaced it is smaller, but it is not the end of the story. As of 23 September 2026, most Indian goods entering the United States pay their normal duty for the relevant tariff line plus a 10 per cent Section 301 duty, and a new sanctions law has reopened the threat of much higher rates. This is a status check for mill operators and buyers on what is actually charged today, and what is still undecided.
What Ended
In 2025 the United States layered reciprocal tariffs and an additional penalty tied to India’s purchases of Russian oil, and the two together reached 50 per cent. On 20 February 2026 the US Supreme Court decided Learning Resources v. Trump, ruling against use of the emergency-powers statute (IEEPA) for those duties. US Customs and Border Protection stopped collecting them on 24 February 2026. Importers of record can seek refunds with interest through the CBP process, which matters for any US buyer that paid the duties on Indian shipments.
A temporary 10 per cent surcharge under Section 122 of the Trade Act replaced the IEEPA duties from 24 February and ran until 24 July 2026, when it expired.
A February 2026 US-India joint statement had signalled an intended 18 per cent reciprocal rate. According to tariff trackers, no order implemented that rate before IEEPA collection ended, and as of 23 September no signed agreement text has been released and no interim agreement is in force. The 18 per cent figure therefore describes an announced intention, not a rate that importers have paid.
What Applies Now
The Section 301 duty
On 24 July 2026 the US Trade Representative’s final action in 60 Section 301 investigations into forced-labour import bans took effect. India sits in the group facing 10 per cent. Another 43 economies face 12.5 per cent, and Vietnam is among those. The duty is charged on top of the normal duty for each product. Reporting put the share of Indian exports covered at about 70 per cent, including textiles and garments, with a short list of exemptions that includes products such as tea and pepper.
Textile-specific carve-outs
This is where competitors have gained an edge. The USTR notice provides for tariff-rate quotas, to be set up when feasible, for Bangladesh, Cambodia, Indonesia and Malaysia. The quotas are tied to each economy’s purchases of US cotton and textile inputs, run for an initial three years, and would let a defined volume of textiles and apparel enter without the Section 301 duty. India has not received an equivalent textile quota. Industry commentary has warned that the difference could divert sourcing away from Indian suppliers, particularly in cotton apparel where Bangladesh competes directly.
Section 232 duties on steel and aluminium, which stand at 50 per cent, are outside the textile picture.
What Is Still Pending
The larger uncertainty is the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, signed into law this month. It authorises tariffs of up to 100 per cent on countries among the five largest buyers of Russian crude oil or gas, and on those that knowingly make new purchases or help Russia evade sanctions. India is among the large buyers. The law gives the administration wide discretion, and it does not name the countries that would be hit.
The Confederation of Indian Textile Industry (CITI) said on 19 September that additional tariffs would be very difficult for a sector dominated by small and medium enterprises to absorb, and called on the government to engage with Washington. Analysts quoted in Indian coverage suggest the administration may hold off before the November midterm elections because of consumer price concerns. That is speculation, not a decision, and nothing has been announced that applies a Russia-related tariff to Indian goods.
What the Export Data Shows
The trade numbers have been more mixed than the tariff headlines suggest. India’s textile exports rose 6.94 per cent in US dollar terms in April to August 2026, while apparel exports fell 9.10 per cent, leaving combined textile and apparel exports marginally lower, by 0.24 per cent, year on year. In August alone, combined exports rose 6.39 per cent: textiles were up 13.03 per cent and apparel was down 2.74 per cent. Fibres, yarns and fabrics are holding up better than garments, which is consistent with garments being the segment most exposed to tariff-driven price competition in the US.
Practical Takeaways for Buyers and Mills
Price on landed cost as of today, with a stated tariff basis. A quote that assumes the Section 301 rate should say so, since a change in either direction could move the landed price after an order is placed.
Check refund eligibility. US importers that paid IEEPA duties on Indian goods may be able to recover them; the process runs through the importer of record, not the supplier.
Watch the competitive quota rules. If Bangladeshi or Cambodian suppliers gain duty-free quota volumes tied to US cotton, price gaps against Indian apparel could widen. Yarn and fabric suppliers to those countries may see the effect through demand.
Treat the sanctions law as a scenario, not a base case. Contracts running into 2027 can include a tariff-change clause without pricing in a 100 per cent rate that has not been proposed.
Status as of late September 2026. Tariff policy is changing quickly; check current USTR and CBP notices before pricing.
Sources: Learning Resources v. Trump, US Supreme Court, 20 February 2026; USTR and Federal Register notices on Section 301 forced-labour actions, June and July 2026; White House US-India joint statement, February 2026; Business Standard and BusinessToday coverage of CITI statements, 19 September 2026; Airlift USA tariff tracker for India.