US imposes 10 per cent tariff on Indian imports over forced labour rules

The United States has imposed a 10 per cent tariff on goods imported from India and 16 other countries as part of its efforts to combat the use of forced labour in the production of such goods.

Last month, when the US proposed tariffs under Section 301 of the Trade Act, India was placed among countries facing a 12.5 per cent levy. However, Washington took note of the amendment New Delhi made to its foreign trade policy prohibiting the import of goods produced using forced labour.

“As a result of these actions, the Trade Representative has advised me that the goods of these economies should be tariffed at the 10 per cent rate to further encourage these economies to effectively enforce such prohibitions,” US President Donald Trump said in a memorandum on the issue on Thursday.

US Trade Representative Jamieson Greer announced the new tariffs on 60 countries under Section 301 of the Trade Act on Thursday, a day before the expiration of 10 per cent additional levies on all countries.

Countries that do not have laws prohibiting goods produced using forced labour, including China, the United Kingdom and Japan, will face tariffs of 12.5 per cent.

The forced labour tariffs will not apply to raw materials that would lead to the unavailability of domestic supply, products that would cause economy-wide disruptions, or products that cannot be produced or grown in sufficient quantities in the US.

Of the 60 countries subject to the tariffs, the 10 per cent rate applies to 17 countries, including India, Canada, the UK, Bangladesh and Pakistan. The remaining 43 countries will face tariffs of 12.5 per cent.