NEW DELHI: India has secured a lower 10 per cent tariff under the latest US trade measures, after initially being considered for a higher 12.5 per cent rate, officials said on Thursday.
The revised rate follows discussions between New Delhi and Washington on labour practices, with officials saying India’s constructive engagement helped it move into the lower tariff category.
The Office of the US Trade Representative (USTR) announced fresh tariffs of 10 per cent and 12.5 per cent on 60 economies under Section 301 of the Trade Act of 1974. The measures target countries that the US says have not taken adequate steps to prevent the import of goods produced through forced labour. The tariffs will come into effect on Friday.
India is among 17 economies placed in the 10 per cent tariff bracket, alongside the United Kingdom, Canada, Indonesia, Mexico, Bangladesh, Pakistan, Sri Lanka, Malaysia, Argentina, Cambodia, Ecuador, El Salvador, Guatemala, Honduras, Jordan and Trinidad and Tobago.
Officials told ANI that India had originally been slated for a 12.5 per cent tariff but was shifted to the lower rate following productive discussions with the US on labour-related measures.
The USTR said the 10 per cent tariff applies to economies that either enforce a ban on imports made with forced labour, have committed to introducing and implementing such measures through an Agreement on Reciprocal Trade, or have adopted a partial regime that prevents the import of certain goods produced with forced labour.
For certain products from the European Union, Taiwan, Japan, South Korea and Switzerland that are not otherwise exempt, the tariff will range between 10 per cent and 12.5 per cent, net of the Most-Favoured-Nation (MFN) rate. All other economies covered by the investigation will face a 12.5 per cent duty.
Announcing the decision, US Trade Representative Ambassador Jamieson Greer said the action had been taken at the direction of President Donald Trump.
“President Trump recognises that decades of moral suasion have not eradicated forced labour from global supply chains. The United States has had a forced labour import ban for nearly a century, and rigorously enforces it; it’s well past time for our trading partners to do the same,” Greer said.
He added, “I am encouraged by the trading partners who have moved quickly to adopt forced labour import prohibitions, and look forward to ensuring their effective enforcement.”
Section 301 of the Trade Act of 1974 gives the US Trade Representative the authority to impose tariffs or other trade measures against countries found to be engaging in unfair trade practices.
The latest decision follows investigations launched by the USTR in March into 60 economies under Section 301(b) to examine whether they had failed to effectively prohibit the import of goods produced using forced labour.
The investigations included consultations with more than 45 governments, public hearings and a review of over 1,600 written submissions on the proposed action.
The move marks the latest step in President Trump’s renewed trade agenda since his return to office and comes after the US Supreme Court earlier this year ruled that many tariffs imposed under emergency powers were unlawful, prompting the administration to rely on alternative legal provisions to pursue its trade policy.
