As US Trade Court blocks most of Trump tariffs, here is how the US president lied about using tariffs to broker India-Pakistan ceasefire to avoid adverse court ruling
On 28th May, a federal court in the United States halted President Donald Trump’s extensive “Liberation Day” tariffs, delivering a significant setback to a crucial aspect of his economic strategies. The International Trade Court determined that an emergency law enacted by the White House does not grant him the sole authority to impose tariffs on almost all nations. Notably, during the hearing, the Trump administration claimed that preventing the imposition of tariffs will result in escalation of India-Pakistan conflict. However, the court didn’t accept that argument.
The Manhattan-based court ruled that the president’s mandate to safeguard the economy does not outweigh exclusive authority of Congress under the country’s Constitution to regulate trade with other countries. Trump exceeded his authority when he used the 1977 International Emergency Economic Powers Act to declare a national emergency and defend the sweeping tariffs, according to the three-judge panel.
They unanimously declared that the White House had acted “contrary to law.” The bench pointed out, “The Worldwide and Retaliatory Tariff Orders exceed any authority granted to the President by IEEPA to regulate importation by means of tariffs. The Trafficking Tariffs fail because they do not deal with the threats set forth in those orders.”
“The court does not pass upon the wisdom or likely effectiveness of the president’s use of tariffs as leverage,” the bench declared and added, “That use is impermissible not because it is unwise or ineffective, but because (federal law) does not allow it,” as it imposed a permanent injunction on the comprehensive tariff orders enacted by Trump since January.
Additionally, the justices mandated that the Trump administration issue fresh directives within ten days that reflected the permanent injunction. The Trump administration filed a notice of appeal shortly after the decision was pronounced and challenged the court’s jurisdiction.
The Trump administration claimed that only Congress, not the courts, has the power to determine whether a president’s declaration of emergency satisfies legal requirements and even cited the upholding of then-President Richard Nixon’s use of emergency tariffs in 1971.
All of Trump’s tariff orders since January that were based on the International Emergency Economic Powers Act, a measure designed to handle “unusual and extraordinary” threats during a national emergency were deemed unconstitutional by the court with immediate effect.
The court also blocked another series of tariffs that the Trump administration had slapped on China, Mexico and Canada upon its return to the White House, citing the intolerable influx of drugs and undocumented immigrants into the United States.
Decades of US trade policy were overturned by the tariffs which also shook financial markets, interrupted international trade and increased the possibility of price hikes and a global recession. The case constitutes one of seven legal challenges directed at the administration’s trade policies together with lawsuits from 13 US states and additional groups of small businesses.
The decision was made following lawsuits initiated by five small import businesses in the United States and a coalition of 13 states spearheaded by Oregon Attorney General Dan Rayfield, who described the tariffs as “unlawful, reckless, and economically devastating.”
No takers for Trump’s India-Pakistan ceasefire lie
Top US officials who were tasked with defending Trump’s trade policies claimed that any effort to limit his authority to use trade and impose tariffs could cause another conflict between India and Pakistan and put millions of lives in jeopardy, among other things. The legal defeat could also shift the direction of a “asymmetric” trade truce with China, per the Trump administration which urged the court to uphold the tariff power.
Government lawyers contended that the tariff policy has sparked international negotiations and any legal restriction would severely diminish US influence on the world stage. Justice Department lawyer Brett Shumate implored, “An injunction would completely kneecap the president,” to which Judge Jane Restani retorted, “The court cannot for political reasons allow the president to do something he’s not allowed to do by statute.”
They reiterated Trump’s statement, which India has consistently denied, that he acted as a mediator between India and Pakistan. They further alleged that only after the president intervened and provided both nations with trading access to the US did a “tenuous” truce was reached.
Four important members of the president’s cabinet, Secretary of State Marco Rubio, Secretary of Treasury Scott Bessent, Secretary of Commerce Howard Lutnick and US Trade Representative Jamieson Lee Greer, signed declarations in the US Court of International Trade and supported the flimsy claim of the president regarding the fresh India-Pakistan dispute.
Lutnick argued against any erosion of the presidential power to invoke US laws to levy tariffs on foreign nations and the potential consequences for utilizing economic tools for strategic purposes. He invoked the military conflict between “nuclear powers” India and Pakistan and the subsequent ceasefire to make his point.
“For example, India and Pakistan, two nuclear powers engaged in combat operations just 13 days ago reached a tenuous ceasefire on 10th May 2025. This ceasefire was only achieved after President Trump interceded and offered both nations trading access with the United States to avert a full-scale war,” he stressed.
Lutnick expressed, “This ceasefire was only achieved after President Trump interceded and offered both nations trading access with the United States to avert a full-scale war. An adverse ruling that constrains presidential power in this case could lead India and Pakistan to question the validity of President Trump’s offer, threatening the security of an entire region and the lives of millions.”
A negative decision, he continued, will also put important trade agreements at risk and permit Chinese aggressiveness during a period of geopolitical rivalry. Lutnick also emphasized that Trump’s use of higher tariffs had allowed the US to secure a 90-day deal with Beijing for a reduction in Chinese duties on US exports.
“The increased tariff rate against China applied additional pressure to achieve the foreign policy objective of bringing China, the greatest contributor to the national emergency and a well-known strategic adversary, to the negotiating table,” he mentioned.
India is presently engaged in negotiations with the United States regarding a bilateral trade agreement aimed at addressing the trade deficit of the US, with Trump asserting that India proposed a deal involving essentially zero tariffs.
According to Rubio’s declaration, any unfavorable decision could undermine US strategic interests across the world as well as gravely and irrevocably impair the nation’s foreign policy and national security. He added that any weakening of the president’s authority to apply tariffs under the International Emergency Economic Powers Act could incite other countries to impose retaliation tariffs on the United States.
He insisted that nations were holding off because they were wary of higher tariffs introduced by the Trump administration under the IEEPA. The officials informed the court that tariff-related trade talks were in progress with a number of nations and that the matter was still in a “delicate state,” with the trade agreements set to be finalized by 7th July.
Trump’s terryfing tariffs
On 2nd April, the American commander-in-chief placed import levies on the majority of the country’s trading partners, revealing an unprecedented global tariff regime. Most countries were subject to a 10% baseline tariff with higher rates imposed on nations that maintain significant trade surpluses with the United States. Dozens of countries and blocs, including the European Union, the United Kingdom, Canada, Mexico and China were targeted with harsher retaliatory duties.
Trump maintained that the comprehensive economic plan would save employment and strengthen American industry. Since the announcement and Trump’s several reversals and halting of duties as foreign countries approached the bargaining table, the world’s markets have been in a state of chaos.
A protracted trade war with China added to the unrest as the two economic titans raised tariffs back and forth, culminating in a 125% Chinese tax on US imports and a 145% US tax on Chinese goods. With the US lowering its levies on China to 30% and the latter dropping its tariffs on certain US imports to 10%, the two largest economies in the world have since reached a truce.
Moreover, a deal on reduced tariffs between the US and UK governments has been announced. However, Trump recently threatened to impose a 50% tariff on all EU-sourced goods. Afterward, he agreed to a more than one-month extension of the deadline for trade negotiations with the bloc.
During the ongoing trade deal negotiations, Trump had earlier declared a reciprocal tariff of 26% on Indian items and attempted to open politically sensitive industries, such as agriculture. Concerns regarding India’s willingness to liberalize certain industries to prevent retaliatory tariffs had been voiced by representatives of the Indian Ministry of Commerce and Industry.
New Delhi responded by approving multiple tariff reductions in the Union Budget presentation, including those on motorbikes and bourbon whiskey. Given that India had consented to terms of reference (ToR) to begin negotiations shortly before reciprocal tariffs went into effect, there was a lot of pressure to strike a trade agreement with the US.
Trump’s claims of mediation between India-Pakistan and New Delhi’s rejection
On 7th May India initiated “Operation Sindoor” following the Pakistan-sponsored 22nd April Pahalgam terror attack. India not only dismantled key terror infrastructure at nine locations in Pakistan but also destroyed its airbases, jets and an AWACS (Airborne Warning and Control System) aircraft when the latter sought to attack civilian areas in the border region.
Pakistan requested a halt in hostilities from India twice, including on the evening of 7th May when the Director General of Military Operations (DGMO) sent an official message, reported India Today. On 10th May at 3:35 pm, following three more days of fierce cross-border military operations, India and Pakistan held a DGMO-level discussion to negotiate a ceasefire agreement, which was also initiated by the Islamic Republic.
The goal of the truce was to reduce tensions between the two neighbors and it was mediated by existing military channels. Nonetheless, Trump asserted that the United States facilitated a ceasefire between India and Pakistan and that the agreement was reached due to his proposal of potential trade concessions.
“After a long night of talks mediated by the United States, I am pleased to announce that India and Pakistan have agreed to a full and immediate ceasefire. Congratulations to both countries on using common sense and great intelligence. Thank you for your attention to this matter,” he announced on Truth Social on 10th May.
“I said, come on, we’re going to do a lot of trade with you guys. Let’s stop it. If you stop it, we’ll do a trade. If you don’t stop it, we’re not going to do any trade. And all of a sudden, they said, I think we’re going to stop. For a lot of reasons, but trade is a big one,” he then claimed while addressing media on 12th May.
Trump portrayed himself as a peacemaker and emphasized that his administration had played a crucial role in brokering peace to avert a “potential nuclear war” between India and Pakistan, which he stated could have led to the loss of millions of lives. “I think they’re actually getting along. Maybe we can even get them together a little bit, Marco, where they go out and have a nice dinner together. Wouldn’t that be nice,” he stated in Riyadh, during his three-nation Middle East visit.
While Islamabad expressed gratitude towards him, India categorically dismissed his assertions. According to India’s foreign ministry spokesperson Randhir Jaiswal, top leaders in Washington and New Delhi spoke after the Indian military’s heated standoff with Pakistan but they did not discuss trade. He firmly asserted that it was the strength of Indian weaponry that compelled Pakistan to halt hostilities and pursue dialogue, rather than any external mediation.
Trump’s claims stand exposed
While Trump consistently boasted about his role and depicted himself as the one who brought rival nations to peace negotiations, the current ruling from the US court has laid bare the truth of his assertions. India has already dismissed his statement, yet his exploitation of the India-Pakistan conflict to maintain tariff power clearly indicates that he fabricated the same for his own benefit in the court of law.
However, the bench appears to have called his bluff. The Trump administration can no longer utilize the sword of tariffs against trading partners or purport to settle conflicts between two adversaries.
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