On March 15, Malaysia became the first country to walk away from its trade deal with the US. The move followed the US Supreme Court’s February 20 ruling that struck down the Trump administration’s “reciprocal tariffs,” removing the legal foundation of the strategy Washington had used to pressure trading partners into making concessions. With the tariff leverage gone, the agreements negotiated under it suddenly lost much of their value. The Supreme Court ruling has forced Washington to rethink its tactics. Unable to rely on sweeping countrywide tariffs, the administration is shifting toward narrower, product-specific investigations to retain leverage and discourage partners from abandoning the deals already signed. Yet this approach risks creating new friction, as governments that already made concessions now face fresh probes and the threat of new tariffs.

The evolving US trade approach, from tariffs to investigations, should concern policymakers and economists about its credibility and future stability. To understand how this situation emerged — and what it could mean for India and the global trading system — it is necessary to trace the evolution of President Donald Trump’s trade strategy from the “Liberation Day” tariffs announced on April 2, 2025, to the legal and political fallout now unfolding.

Phase one of the Trump administration’s trade policy began in April 2025, when Washington imposed high “reciprocal tariffs” on most trading partners, arguing that foreign barriers were responsible for the large US trade deficit. The US offered countries relief if they negotiated concessions on tariffs, investment rules, procurement access or regulatory barriers.

Because the US remains one of the world’s largest export markets, the threat carried weight. Governments........

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