US President Donald Trump has announced preliminary duties of 126% on solar imports from India, a move that could jeopardize the recently agreed framework for an India-US trade deal.
The US Commerce Department said the decision followed its finding that New Delhi had unfairly subsidised domestic solar manufacturing, enabling Indian exporters to sell panels in the American market at prices that undercut US producers. In addition to India, preliminary duties were set at 86% to 143% for Indonesia and 81% for Laos.
The action comes just weeks after Washington and New Delhi reached a framework agreement aimed at reducing US tariffs on Indian exports to 18%, down from 50%. That agreement followed a US Supreme Court ruling that struck down Trump’s earlier tariff measures as unconstitutional. In response, Trump introduced a new baseline duty of 10% on most imports, while warning it could be raised to 15%.
The latest tariff escalation signals that the administration’s “America First” trade posture remains central, even if it complicates broader strategic trade negotiations.
The solar supply chain shift
Imports from India, Indonesia and Laos accounted for 57% of total US solar module imports in the first half of 2025. Industry observers say much of this surge reflects Chinese manufacturers relocating production to Southeast Asia to bypass US trade barriers.
India has emerged as a major beneficiary of that shift. Solar exports from India to the United States reached $792.6 million in 2024 — a ninefold increase compared with 2022.
Tim Brightbill, lead counsel for the Alliance for American Solar Manufacturing and Trade, welcomed the move, calling it a boost for domestic investment. “Those cannot succeed if unfairly traded imports are allowed to distort the market,” he said.
Challenges for US solar developers
However, the tariffs could create fresh challenges for US solar developers. Restricting Indian imports may push up equipment costs at a time when the industry is already contending with elevated borrowing costs and policy uncertainty.
A final determination on the subsidy investigation is expected by 6 July 2026, alongside the outcome of a parallel anti-dumping probe.
