US Imposes 10% Tariff On Indian Imports Over Forced Labour Concerns

New Delhi, Jul 24 (KNN) The United States has imposed a 10 per cent tariff on imports from India following an investigation into forced labour practices under Section 301 of the Trade Act of 1974. 

The new duties took effect at 12:01 am EDT on Friday, replacing a temporary baseline tariff that had applied to all trading partners.

Lower-Than-Proposed Tariff for India

The Office of the US Trade Representative (USTR) had earlier proposed a higher tariff of 12.5 per cent on Indian goods. However, the final rate was reduced to 10 per cent after India amended its Foreign Trade Policy to restrict imports linked to forced labour.

According to the USTR, the decision was based on the findings of its investigation, India’s policy changes, inputs from public hearings, and recommendations from advisory bodies.

Broader Action Against Multiple Economies

The tariffs are part of a wider US action targeting 60 economies. Of these, 18 economies, including India, have been placed in the lower 10 per cent tariff bracket, while others face a higher 12.5 per cent duty.

The USTR said the decision followed extensive consultations, including two rounds of public hearings and more than 2,100 public comments, along with engagement with partner countries.

Aim to Address Labour Concerns

US Trade Representative Jamieson Greer said, “President Trump recognizes that decades of moral suasion have not eradicated forced labor from global supply chains.  The United States has had a forced labor import ban for nearly a century, and rigorously enforces it; it’s well past time for our trading partners to do the same.” 

“Today’s action will begin to correct what is both a human rights abuse and distortive trade practice to improve the welfare of workers everywhere.  I am encouraged by the trading partners who have moved quickly to adopt forced labor import prohibitions, and look forward to ensuring their effective enforcement,” Greer added.

Framework and Exemptions

Under the final framework, countries that have introduced or committed to implementing adequate forced labour import bans qualify for the 10 per cent tariff category. India falls into this group following recent policy adjustments.

Goods already in transit will remain exempt from the new tariffs until July 28, according to the USTR.

Legal Basis

Section 301 of the Trade Act of 1974 allows the US government to investigate foreign trade practices and impose tariffs or other penalties if they are deemed to unfairly affect US commerce.

(KNN Bureau)