India has poked holes in US’s plans to impose another tariff series linked to alleged forced labour, arguing that its own approach is inconsistent and the issue be dealt with through bilateral trade negotiations instead of unilateral action. Speaking before a panel of the US Trade Representative (USTR) earlier on Wednesday, Brij Mohan Mishra, joint secretary in the ministry of commerce, questioned the basis of the proposed tariffs and highlighted what India sees as inconsistencies in the US framework.Mishra pointed out that the USTR exempts around 1,600 products that cannot be produced or grown in the US from scrutiny related to forced labour.“What we submit is that the exemptions provided by the USTR not only undermine the policy rationale of addressing forced labour impact in the global supply chain but also of preventing such impact caused by circumvention practices,” Mishra said while responding to questions from the USTR panel.He also objected to the US practice of offering lower tariff rates on textile products manufactured using US cotton and related inputs.“By providing reduced tariff rates on the basis of imports of US-origin textile inputs, the textiles mechanism operates as an arbitrary requirement that influences and constrains the sourcing decisions of foreign manufacturers, without fully addressing the concern of forced labour,” Mishra said.While raising these concerns, Mishra said India remained willing to engage with the US and that such issues should be resolved through the India-US bilateral trade negotiations instead of through Section 301 investigations.
Inconsistent probe, consistent tariff plans
After US President Donald Trump’s global tariffs were overturned by the US Supreme Court, the administration launched a Section 301 investigation. As part of that probe, the USTR has been conducting public hearings between Tuesday and Thursday into alleged forced labour practices across 60 economies.It has proposed additional tariffs of between 10% and 12.5% on imports from these economies, alleging they have failed to prevent goods made with forced labour from entering global supply chains. Representatives of FICCI and CII also appeared before the panel to present India’s views.Also read | What is India’s strong stand on US Section 301 probe that proposes 12.5% duties? ExplainedPoornima Shenoy, FICCI’s representative in the US, said the proposed tariffs would increase costs throughout the supply chain. “An additional tariff will increase costs not only for Indian exporters, but also for US manufacturers, importers, retailers and ultimately American consumers,” Shenoy said.She said American companies have built long-standing sourcing relationships with Indian suppliers because they provide quality, reliability and full compliance.“Higher tariffs for these established supply chains will raise costs for businesses that already follow compliance standards. It will not help in identifying goods produced with forced labour. It would simply make trusted supply chains more expensive,” Shenoy said.
India refutes ‘unreasonable’ claims
India has also submitted that the USTR has failed to establish, through evidence, that the absence of forced labour import bans in these countries substantially distorts market conditions or affects the profitability of compliant firms.“India submits that a mere absence of a forced labour import prohibition, without meeting the evidentiary basis of other statutory requirements, cannot be construed as “unreasonable” within the meaning of Section 301 of the Act,” it said.CII representative Suchita Sonalika argued that India’s policy framework cannot be considered “unreasonable” or “discriminatory” under Section 301(b) of the Trade Act of 1974. She also said India’s constitutional and statutory framework ensures that companies cannot practise forced labour.
The government further has argued that the USTR had not conducted an economy-specific assessment of the laws and practices of the 60 economies under investigation, instead issuing a broad conclusion without taking into account the specific measures adopted by individual countries.“In relation to India, there is inadequate and insufficient evidence that the lack of a forced labour import ban causes an alleged unfair comparative advantage to the detriment of the US industry. Evidence across sectors of major exports of India to the US does not suggest any linkage with forced labour inputs,” it added.
Section 301 probe
The USTR launched two separate Section 301 investigations on March 11 and 12, 2026, covering concerns related to forced labour and excess industrial capacity. On June 3, it issued its findings in the forced labour investigation and proposed additional tariffs on imports from 54 economies.The Donald Trump administration’s Section 301 investigations have added uncertainty for several countries, including India. Public hearings on the forced labour probe are being held between Tuesday and Thursday, ahead of the July 24 deadline for the temporary 10% additional tariff.According to policymakers and trade experts, the pace of the investigation suggests the US could replace the existing 10% tariff, which remains in force until July 24, with the proposed forced labour-related tariff. The USTR has not yet released its preliminary findings in the separate investigation into alleged structural excess capacity across multiple sectors.
