- The US extended a 10% tariff on Indian exports, citing allegations of lax forced labour enforcement, but experts argue it lacks a credible factual basis and no evidence of forced labour imports has been produced.
- The tariff is part of a USTR Section 301 enforcement action replacing expired levies, imposing rates of 10% to 12.5% on nearly 60 countries; India was initially bracketed at 12.5% but secured a lower rate.
- India’s external affairs ministry stated its position and hopes for an early conclusion of the bilateral trade agreement, as MEA spokesperson Randhir Jaiswal called it a 301 enforcement action after the Supreme Court ruling.
- India amended its Foreign Trade Policy to ban imports produced with forced labour, and domestic law already prohibits forced labour through constitutional guarantees.
- Expert Ajay Srivastava said the tariff primarily serves to preserve Trump’s tariff wall after temporary tariffs expired, not as a response to a proven forced-labour problem.
- Textile and apparel makers fear India is at a disadvantage because it was excluded from tariff-rate quotas granted to competitors like Bangladesh and Cambodia using US-origin cotton.
- The move is the White House’s latest effort to restore Trump’s near-global tariff vision after the Supreme Court struck down “reciprocal” duties in February.
The U.S. has extended a 10% tariff on Indian goods as part of a broader enforcement action against forced labor allegations, despite experts claiming the move lacks a credible basis.
Ajay Srivastava, founder of GTRI, stated, “The US has not produced evidence that India imports goods made with forced labour.” The tariff affects nearly 60 countries and replaces previous levies that lapsed.10
The U.S. Trade Representative's office outlined the new duties in a 431-page filing, with India initially bracketed for a higher 12.5% rate.45
In response, India's external affairs ministry expressed hope for a swift conclusion to ongoing trade negotiations, emphasizing that “Our talks on the bilateral trade agreement with the US side continues with a view to concluding the BTA at an early date.”
India has amended its Foreign Trade Policy to ban imports produced using forced labor, reinforcing its commitment to labor rights.
However, textile and apparel manufacturers in India fear competitive disadvantages due to exclusion from tariff-rate quotas that benefit other countries. CITI chairman Ashwin Chandran warned that “The differential treatment risks diverting sourcing orders for textile and apparel items away from India.”
This tariff extension is seen as a continuation of the Trump administration's trade policies, aiming to maintain a near-global tariff structure following a Supreme Court ruling that struck down previous duties.67
“The tariff is part of a USTR Section 301 enforcement action replacing expired levies, with India initially bracketed at 12.5% before securing a lower rate. India's external affairs ministry stated its position and hopes for an early conclusion of the bilateral trade agreement.”
