The recent US Supreme Court ruling on IEEPA tariffs has created a potentially significant refund opportunity for exporters worldwide, including those in India.
While headline estimates suggest billions of dollars in duties could be reclaimed, the reality is far more complex, with eligibility hinging on shipping terms, importer status, and a multi-layered filing process.
For Indian exporters—particularly SMEs already strained by months of tariff uncertainty—the ruling raises both opportunities and challenges.
In this interview with Invezz, Ishita Chawla, Lead, E-Commerce Vertical at Skydo, explains the true scale of the opportunity, the practical hurdles exporters face, and how shifting US trade policies continue to reshape export strategies.
Invezz: The US Supreme Court ruling has opened up what could be a massive refund opportunity globally. How large do you estimate the opportunity is specifically for Indian exporters, and which sectors are most exposed?
The headline number is $166 billion globally, and GTRI estimates India’s linked share at roughly $12 billion. But that figure overstates what Indian exporters can actually claim.
The $12 billion represents total IEEPA duties paid on Indian-origin goods.
However, only DDP shipments, where the Indian exporter paid the US customs duty themselves and is the Importer of Record, are eligible. Our rough estimate based on shipping volumes puts the realistic DDP-eligible pool at closer to $150 million.
In terms of sectors, textiles and apparel, gems and jewellery, leather and footwear, marine products, chemicals, and automobile components collectively make up over 55% of India’s exports to the US, placing them as most exposed.
Invezz: Many exporters may not even realize they are eligible for refunds. What are the biggest misconceptions or gaps in awareness you are seeing right now?
The biggest challenge is a basic uncertainty around eligibility. Many Indian exporters who shipped on DDP terms cannot confirm whether they are the Importer of Record on their shipments without checking their CBP entry summary document.
Those who do confirm they’re the IOR face difficulties with the process itself: the CAPE portal requires ACE access, structured CSV uploads, and validation against CBP records, which is considerably more involved than a simple online form many expect.
Lastly, exporters who find out they’re not the IOR – and that the designation sits with their US buyer or freight partner – face a harder problem altogether.
The refund is legally disbursed to the IOR, not the exporter, leaving them reliant on commercial negotiation with a party under no obligation to pass the money back.
Invezz: How complicated is the CAPE filing process in practice? What are the most common mistakes exporters could make that may delay or jeopardize claims?
More involved than most exporters expect. Filers must upload a structured CSV of entry numbers through the ACE portal, which runs two rounds of validation – first on the declaration, then on each individual entry.
A common cause of rejection is formatting. But the complications start well before filing.
Exporters need to locate their CBP Form 5106, which was filed when they first imported into the US – often years ago – and many don’t have it readily accessible.
The email address on that form matters: CBP sends an OTP to the email listed on the 5106, so if details don’t match or the address is outdated, the process stalls.
Then there’s identifying which specific shipments had IEEPA duty codes applied – this is a largely manual exercise of going through entry summaries to isolate the relevant ones.
Beyond that, some filers discover that their original entry summaries were filed incorrectly during the tariff period, meaning the recalculated refund amount doesn’t match expectations.
Further, Indian exporters need a US bank account to receive the ACH refund, which most don’t have.
Invezz: One major hurdle appears to be the Importer of Record requirement. How difficult is coordination between exporters, freight partners, and US import entities proving to be?
Many Indian exporters don’t have their IOR documentation readily accessible – the CBP Form 5106, EIN, and copies of import entries typically sit with their freight forwarder, not with them.
If unsure, exporters should check their customs entry summary document: if their company name appears as the importer in field no. 26, they are the IOR.
For exporters who shipped dozens of consignments over the April 2025 – February 2026 window across multiple logistics partners, simply compiling the paperwork is an operational burden.
The problem is worse when the freight partner is itself the IOR, which disqualifies the exporter entirely but often isn’t clear until the documents are pulled.
Larger exporters with their own customs bonds and clean records move through this relatively more smoothly.
Invezz: A lot of Indian SMEs operate with thin margins and limited compliance bandwidth. How financially painful were these tariffs for smaller exporters over the last year?
For SMEs that export to the US, the pain was disproportionate. Most operate on thin margins with limited working capital – a 26% tariff compresses those margins severely, and the escalation to 50% in August 2025 made many product categories uncompetitive overnight.
The practical response for most was simply to stop shipping to the US during the high-tariff window, which meant lost revenue with no immediate alternative.
The refund process now adds a second layer of difficulty: per-exporter refund amounts for smaller shippers are modest, but the filing costs and documentation burden are essentially fixed regardless of claim size.
Invezz: The broader issue here is policy unpredictability. How much damage has the stop-start nature of US trade policy caused to exporter confidence, pricing strategies, and long-term planning?
The rate on Indian goods changed five times in ten months: 26% in April 2025, 50% in August, 18% under the interim deal in November, zero when IEEPA was struck down in February 2026, then 10% under Section 122 the same week.
Export contracts are typically negotiated 3-6 months ahead – every contract signed during this period was mispriced in one direction or the other.
The Section 122 replacement tariff expires around July 24, 2026, and is already being challenged by 24 US states, meaning exporters are pricing contracts today without knowing what the rate will be a month from now.
The damage goes beyond margins: long-term buyer-supplier relationships that took years to build were strained or broken as US buyers shifted sourcing away from India to Vietnam, Bangladesh, and Mexico during the high-tariff window.
Some of those relationships won’t come back even with tariffs reduced.
Invezz: The portal launched April 20. What are the known gaps in Phase 1, and what risks do exporters face if guidelines continue to evolve mid-filing?
The CAPE refund system launched on April 20 and is being rolled out in phases. Phase 1 — which covers the most straightforward entries is operational and has processed roughly $24 billion in approved refunds as of early June.
But that’s only a fraction of the $166 billion total. Phase 2 (covering more complex entry types) launches June 29, and Phase 3 is targeted for late July.
The core risk is that the US government is actively contesting how broadly refunds should be issued – particularly for older entries that have already been finalised in the customs system.
Depending on how that legal challenge plays out, some categories of entries may face significant delays or may require the importer to file an individual lawsuit to access their refund.
For Indian exporters, the practical takeaway is straightforward: file early on entries that are clearly eligible under Phase 1, but recognise that the process is still being built and the rules governing later phases are not yet settled.
Invezz: Have exporters become more cautious about relying heavily on the US market after the tariff episode, or do most still see America as indispensable despite the volatility?
Both. Indian exporters have diversified aggressively – seafood exports to Vietnam doubled, non-US markets are gaining share across textiles and engineering goods, and some larger companies have opened US-based manufacturing to sidestep tariffs entirely.
But the US still accounts for roughly 18% of India’s total exports, and for sectors like electronics (38% of exports), gems and jewellery (33%), and textiles (28-34%), there is no single replacement market of equivalent scale.
The more accurate picture is that exporters now treat the US as a high-return but high-volatility market rather than a stable baseline.
The largest ones are hedging through onshore US production. Mid-tier exporters are maintaining US relationships while building parallel channels to Europe, the Middle East, and Southeast Asia.
The smallest remain the most exposed, lacking the scale to diversify meaningfully or the compliance bandwidth to navigate rapid policy shifts.
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