U.S. proposes 12.5% tariff on India and other countries, Indian govt says it ‘remains engaged’ with U.S.

Subscribed with another email? Logout and Login with that one. Account subscription benefits alongside Premium Stories, Editorials, Opinions and more. Unlock these with Subscription The View From India Looking at World Affairs from the Indian perspective. First Day First Show News and reviews from the world of cinema and streaming. Today's Cache Your download of the top 5 technology stories of the day. Science For All The weekly newsletter from science writers takes the jargon out of science and puts the fun in! Data Point Decoding the headlines with facts, figures, and numbers THEdge At the cutting edge of education and careers Health Matters Ramya Kannan writes to you on getting to good health, and staying there Gender Agenda Stories from beyond the binary. The Hindu On Books Books of the week, reviews, excerpts, new titles and features. Updated - June 04, 2026 12:34 am IST - Washington Image used for representational purposes only. | Photo Credit: Getty Images/iStockphoto The U.S. government has proposed to levy a tariff of 12.5% on imports from 54 countries, including India, that it says have “failed to impose and effectively enforce” prohibitions on the import of goods produced using forced labour. In response, the Indian government has said it “remains engaged” with the U.S. government regarding this development as well as the finalisation of an Interim Agreement on trade. The office of the U.S. Trade Representative had, in March this year, launched an investigation under Section 301 of the U.S. Trade Act of 1974 to look into whether its trade partners were taking enough steps to stop the import of goods that are made using forced labour. The latest tariff announcements, as part of this investigation, are not final as yet. Countries, including India, can submit requests to take part in public hearings by June 22, submit written comments by July 6, and participate in the public hearings on July 7. According to trade experts, this was a tool for the U.S. to impose tariffs on its imports after the U.S. Supreme Court in February struck down the reciprocal tariffs — including the 50% levied on India — that had been imposed by U.S. President Donald Trump. “The failure of our most important trading partners to address the importation of goods made with forced labour is unacceptable,” U.S. Trade Representative (USTR) Jamieson Greer said on June 2, as part of the announcement of the investigation findings. “This creates a dynamic where American workers are forced to compete globally on an uneven playing field. We will no longer tolerate this disparity,” he added. According to the report released by the USTR, India is one of the 54 countries that were investigated and that were found to have “failed to impose and effectively enforce” prohibitions on the import of goods produced using forced labour. “The results of this investigation indicate that the acts, policies and practices of India related to the failure to impose and effectively enforce a forced labour import prohibition are unreasonable and burden or restrict U.S. commerce,” the report said. As a result, the USTR has proposed a tariff of 12.5% on imports from these 54 countries. This puts India in the same tariff bracket as several of its competitors, including Bangladesh, China, Malaysia, Thailand, and Vietnam. The proposal by the USTR also includes a separate mechanism for textile and apparel products, under which a certain volume of imports from selected economies would be allowed to enter the U.S. at lower tariff rates. According to Agneshwar Sen, trade policy leader at EY India, the impact of these tariffs on India could be multidimensional. “In the near term, exporters in labour-intensive industries such as textiles, garments, carpets, leather products, and brassware could face at least an additional 10% levy under Section 301, adding to their existing tariff exposure,” Mr. Sen said. “India should therefore submit detailed written representations by July 6 and participate proactively in the July 7 public hearing to challenge these conclusions,” he added. “India remains engaged with the U.S. on the matter as a part of Section 301 proceedings,” the Ministry of Commerce and Industry said in a statement on June 3. “India is also parallelly engaged with the U.S. for finalisation of a framework agreement as was announced on February 2, 2026, and in accordance with the joint statement released on February 7, 2026,” he added. A negotiating team from the U.S., led by Deputy USTR Brendan Lynch, is currently in India on a three-day visit to New Delhi that will conclude on June 4. According to the Ministry of Commerce and Industry, the purpose of the trip is to “finalise the details” pertaining to the Interim Agreement between the two countries and take forward the negotiations on a broader Bilateral Trade Agreement (BTA). According to Mr. Sen, negotiating a commitment at even a framework level that ensures the absence of forced l

U.S. proposes 12.5% tariff on India and other countries, Indian govt says it ‘remains engaged’ with U.S.

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U.S. proposes 12.5% tariff on India and other countries, Indian govt says it ‘remains engaged’ with U.S.

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