India Calls on US to Reevaluate 12.5% Tariff Linked to ‘Forced Labour’ Investigation Under USTR’s Section 301

India has formally requested the United States to withdraw its proposed 12.5% tariff on Indian imports. This proposal arises from a Section 301 investigation by the Office of the United States Trade Representative (USTR) into forced labour-related trade practices. India argues that the USTR’s findings lack adequate evidence and fail to provide a country-specific assessment.

In a submission dated July 6, India contended that the USTR’s investigation does not demonstrate how its laws or policies constitute an “unreasonable” trade practice under Section 301. The Indian government asserted that the USTR has not shown that India’s regulatory framework causes measurable harm to U.S. industry. This request follows the USTR’s initiation of two separate investigations in March, which examined 60 economies for concerns related to forced labour and industrial overcapacity.

The USTR proposed additional duties on imports from 54 economies in June, with India among 48 countries facing the potential 12.5% tariff. Other nations, including Canada and the European Union, could face a lower 10% duty. The proposal is still under consultation and has not yet been implemented. India criticized the USTR’s broad approach, arguing that it failed to evaluate the legal frameworks and enforcement mechanisms of each economy individually.

India’s submission emphasized that the USTR’s findings do not adequately establish that its existing policies distort trade or provide exporters with an unfair competitive advantage. The Indian government expressed its willingness to engage constructively with the USTR through consultation and dialogue regarding any specific concerns. Additionally, India pointed out that the investigation does not provide evidence linking its export sectors to forced labour or demonstrating that the absence of an import prohibition on goods produced with forced labour disadvantages American businesses.

The USTR is currently holding public hearings on the proposed tariffs. Written submissions and oral testimony will be considered before the agency makes a final decision.

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