The United States Trade Representative (USTR) has proposed trade measures against 60 economies, including India, over allegations that they have failed to effectively ban and enforce restrictions on imports linked to forced labour.
In a statement released on Tuesday, the USTR said its investigation under Section 301 of the US Trade Act of 1974 found that the policies and practices of these economies are “unreasonable and burden or restrict US commerce,” making them subject to potential trade action.
India is among 54 economies flagged for not adequately enforcing prohibitions on goods produced using forced labour. Other countries named include Australia, China, Japan, Singapore, the United Kingdom, Saudi Arabia, and the United Arab Emirates.
US Trade Representative Jamieson Greer said the failure to address forced labour in global supply chains creates unfair competition for American workers and distorts international trade.
Proposed tariffs and next steps
Following the findings, the USTR has suggested additional import duties on goods from the affected economies. Countries that already have or commit to forced labour import bans could face a 10% tariff, while others may be subject to a 12.5% duty. A separate mechanism has also been proposed for certain textile and apparel imports.
The investigation, launched on March 12, included testimony from nearly 60 witnesses and about 500 public submissions, according to the agency.
The USTR argued that weak enforcement of forced labour bans undermines global efforts to eliminate such practices, gives unfair cost advantages to some producers, and allows circumvention of existing trade restrictions.
Trade talks continue amid tensions
The development comes at a sensitive moment in India-US trade relations, as both countries continue negotiations on the first phase of a bilateral trade agreement. Discussions have covered issues such as tariffs, agriculture, digital trade, and market access.
Tensions have also been influenced by earlier US tariff threats under President Donald Trump’s reciprocal trade policy, some of which were temporarily paused to allow negotiations.
Despite occasional disputes, the United States remains India’s largest trading partner, with bilateral trade exceeding $120 billion in recent years.
The USTR has invited public comments until July 6 and will hold hearings on July 7 before making a final decision. While the findings do not automatically trigger tariffs, they could lead to duties or other restrictions if the US moves ahead with enforcement.
