India Challenges US Tariff Plan Over Forced Labour Claims

India has raised concerns over the US approach to imposing tariffs on goods allegedly linked to forced labour.

During a public hearing conducted by the US Trade Representative (USTR), Brij Mohan Mishra, Joint Secretary in the Ministry of Commerce, pointed out inconsistencies in the US approach. Mishra stated that the US exempts 1,600 items that cannot be produced or grown domestically from forced labour scrutiny.

Mishra argued that these exemptions undermine the policy rationale of addressing forced labour impact in the global supply chain. He also pointed out that the US provides reduced tariff rates on textile exports manufactured using US cotton and related items.

According to Mishra, this mechanism operates as an arbitrary requirement that influences and constrains the sourcing decisions of foreign manufacturers, without fully addressing the concern of forced labour. India remains open to discussions and believes that concerns should be addressed through bilateral trade negotiations rather than unilateral action.

Representatives of industry bodies FICCI and CII also opposed the US proposal to impose tariffs ranging from 10% to 12.5% on imports from 60 economies. They warned that an additional tariff will increase costs not only for Indian exporters but also for US manufacturers, importers, retailers, and ultimately American consumers.

Poornima Shenoy, FICCI representative in the US, stated that several US industries depend on long-standing sourcing ties with Indian suppliers due to their quality, reliability, and compliance standards. She argued that higher tariffs for these established supply chains will raise costs for businesses that already follow compliance standards.

CII representative Suchita Sonalika said that India's policy framework does not qualify as 'unreasonable' or 'discriminatory' under Section 301(b) of the Trade Act of 1974. Sonalika also stated that India has a strong constitutional and statutory framework to ensure that companies cannot engage in forced labour.

The USTR launched two separate Section 301 investigations on March 11 and March 12, 2026, covering 60 economies over concerns related to forced labour and excess industrial capacity. On June 3, the USTR issued its findings, which India has challenged.

The dispute between India and the US over the tariff plan has significant implications for bilateral trade relations. India is seeking a fair approach to addressing forced labour concerns, and the outcome of this dispute will be closely watched by businesses and trade experts.

In the context of India-US trade relations, this dispute is a significant development. The US is one of India's largest trading partners, and any tariffs imposed by the US could have a significant impact on Indian exporters. India has been seeking to strengthen its trade ties with the US, and a resolution to this dispute will be crucial for the future of bilateral trade relations.

The Indian government has been working to improve its labour laws and regulations to address concerns over forced labour. However, the US tariff plan has been seen as an unfair and unilateral measure that could harm Indian businesses and exporters.

Overall, the dispute between India and the US over the tariff plan is a complex issue that requires a fair and nuanced approach. India is seeking a resolution that addresses the concerns over forced labour while also protecting the interests of Indian businesses and exporters.

The outcome of this dispute will have significant implications for India-US trade relations and the global trade landscape. It will be important to watch how this dispute unfolds and how it is resolved, as it will have a significant impact on businesses and trade experts around the world.

In conclusion, India's challenge to the US tariff plan is a significant development in the context of India-US trade relations. The dispute highlights the need for a fair and nuanced approach to addressing concerns over forced labour, and the outcome will have significant implications for bilateral trade relations and the global trade landscape.