The United States has imposed a 10% tariff on imports from India, placing it on par with Pakistan, Sri Lanka and Bangladesh, following a US investigation into the enforcement of restrictions on goods made using forced labour.
The tariff is lower than the 12.5% rate initially proposed for India under Section 301 of the US Trade Act of 1974. The new duties apply to imports from around 60 countries, which together account for more than 99% of US imports.
The tariffs replace a temporary 10% global duty introduced in February, which expired this week.
US Trade Representative Jamieson Greer said the move was aimed at addressing forced labour, which Washington described as both a human rights violation and a trade distortion.
The action follows two Section 301 investigations launched by the Trump administration in March. The provision allows the US to impose trade measures against countries accused of unfair or discriminatory practices.
India is also facing a separate Section 301 investigation into alleged excess manufacturing capacity. The probe is still underway and could create additional tariff-related risks for Indian exporters.
The latest tariff announcement comes as India and the US continue negotiations on a broader trade agreement. Under a framework agreed in February, tariffs on Indian exports were proposed to fall from 50% to 18%, including a 25% penalty linked to India’s purchase of Russian oil.
In return, India proposed buying $500 billion worth of US goods over five years and expanding market access for American products, including selected agricultural goods.
However, uncertainty remains over the implementation of the proposed 18% tariff after the US Supreme Court struck down the Trump administration’s global reciprocal tariffs.
India is also concerned that it faces two Section 301 investigations, while countries such as Pakistan and Sri Lanka are currently subject only to the forced-labour probe. Trade experts warn that if competing economies eventually receive lower overall tariff rates, Indian exports could lose their competitive advantage in the US market.
The latest development could therefore add further complexity to ongoing India-US trade negotiations.
