The United States has recommended implementing a 12.5% additional tariff on goods imported from India, citing concerns that the country has not adequately prevented imports produced through forced labor.
This recommendation emerged during the second day of a three-day trade negotiation session in New Delhi, where Indian trade officials are meeting with a U.S. delegation headed by Assistant USTR Brendan Lynch.
According to a 92-page report released Monday by the U.S. Trade Representative’s office, India “has failed to impose and effectively enforce a forced labour import prohibition.” The report characterized the South Asian country’s policies as unreasonable and detrimental to U.S. commerce.
“The failure of our most important trading partners to address the importation of goods made with forced labour is unacceptable,” U.S. Trade Representative Jamieson Greer stated.
“This creates a dynamic where American workers are forced to compete globally on an unlevel playing field,” Greer added.
India’s commerce ministry has not yet provided a response to requests for comment regarding the proposal.
The recommendation stems from a Section 301 unfair trade practices investigation, as the Trump administration works to reconstruct emergency tariffs that were overturned by the Supreme Court in February.
The proposal groups India with 54 other countries that do not have forced-labor import restrictions and would therefore be subject to the higher proposed duty.
Six additional countries, including Canada, Ecuador and the European Union to Indonesia, Mexico and Pakistan, maintain such restrictions but would face a reduced 10% tariff for inadequate enforcement.
Ajay Srivastava, founder of Global Trade Research Initiative, suggested the determination could face challenges, noting that the USTR investigation focused on whether India prevented imports connected to forced labor from other regions, rather than examining forced labor in Indian exports.
“The proposed tariffs are viewed as part of broader U.S. pressure tactics, and India should treat Section 301 actions and the India–U.S. bilateral trade agreement negotiations separately,” he stated.
A government source from India had previously indicated to Reuters that New Delhi intended to discuss the Section 301 investigation with Lynch’s delegation and pursue tariff relief within the framework of broader bilateral trade negotiations.
The USTR report additionally highlighted India’s role as an intermediary in cotton supply chains connected to Chinese forced-labor inputs.
