US Introduces New Tariffs Up to 12.5% on 60 Economies Following ‘Forced Labour’ Investigation
The Trump administration has announced new tariffs of 10% and 12.5% on imports from 60 economies, including India. This decision aims to encourage trading partners to enhance enforcement against goods produced using forced labor. India qualifies for the lower 10% rate due to recent policy changes that strengthen its stance on forced labor imports.
The new tariffs, effective at 12:01 AM EDT on Friday, replace a temporary 10% global tariff that is set to expire simultaneously. Goods already in transit will remain exempt from these tariffs until July 28, according to the Office of the US Trade Representative (USTR). The tariffs stem from investigations conducted by US trade bodies, which included public hearings and consultations with various governments.
US Trade Representative Jamieson Greer stated that the administration recognizes the need for stronger enforcement against forced labor in global supply chains. He emphasized that the United States has maintained a forced labor import ban for nearly a century and expects trading partners to adopt similar measures. The tariffs target countries that have not effectively prohibited or enforced restrictions on imports made with forced labor, arguing that lax enforcement creates an unfair trade advantage.
Under the new framework, countries with adequate forced labor import bans or those that have committed to implementing such measures will face a 10% tariff. India falls into this category following its recent policy adjustments. In contrast, countries with insufficient safeguards will incur a 12.5% tariff. Certain products from the European Union, Japan, South Korea, Taiwan, and Switzerland will also attract tariffs of either 10% or 12.5%.
Additionally, the USTR has initiated a Section 301 investigation into 16 economies for allegedly overproducing goods, which has driven down global prices and negatively impacted US manufacturers. This investigation could result in further tariffs. Several products, including oil and gas, fertilizers, and certain food items, have been exempted from the new duties, along with goods already covered by national security tariffs on steel, aluminum, copper, and automobiles.
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