USTR proposes 12.5% additional duties on India and with others over forced labor import violations

Highlights

• USTR has proposed 12.5 per cent additional duties on 54 countries, including India.
• The proposal follows investigations into 60 countries over forced labor import practices.
• India has denied the allegations and asked the US to end the investigation.
• Six economies were cited for failing to enforce existing prohibitions effectively.
• Public hearings on the proposed actions are scheduled for July 7.

The US Trade Representative (USTR) has proposed imposing an additional duty of 12.5 per cent on imports from 54 countries, including India, for failing to prohibit the import of goods produced with forced labor.

The proposal comes after investigations were launched against 60 countries. According to the USTR, these countries failed to impose and effectively enforce bans on imports made with forced labor.

"The failure of our most important trading partners to address the importation of goods made with forced labour is unacceptable. This creates a dynamic where American workers are forced to compete globally on an unlevel playing field,” US Trade Representative Ambassador Jamieson Greer said in a statement.

"We will no longer tolerate this disparity," he said.

India has rejected the allegations made under the forced labor clause. The country has asked the United States to end the investigations, stating that such issues should be addressed through the framework of ongoing bilateral trade negotiations.

Greer said that while some trading partners have taken initial steps to prevent the importation of forced labor goods, including through USMCA and commitments in Agreements on Reciprocal Trade, more action is needed.

"Each of our trading partners must do more to ensure that trade does not perversely encourage and entrench forced labour globally," he said.

According to the USTR statement, 54 countries, including India, China, Japan, Brazil, Australia, the United Kingdom, and Saudi Arabia, have failed to impose and effectively enforce a prohibition on the importation of goods produced with forced labor.

The statement also identified six economies that have failed to effectively enforce existing prohibitions on the importation of goods produced with forced labor. These economies are Canada, Ecuador, the European Union, Indonesia, Mexico, and Pakistan.

For economies that already impose a forced labor import prohibition, have committed to impose and enforce such a prohibition through an Agreement on Reciprocal Trade, or have implemented a partial regime that prevents the importation of certain forced labor goods, the USTR has proposed an additional duty of 10 percent.

"For all other economies, the US Trade Representative proposes 12.5 per cent as the rate of additional duty,” the statement said.

The proposed 12.5 percent duty would apply to the 54 countries identified by the USTR.

The USTR has also proposed a textile mechanism that would allow a certain volume of apparel and textile imports from selected economies to enter the United States at a reduced tariff rate.

The agency has invited interested parties to submit requests to appear at the hearings, along with a summary of their testimony, by June 22. Written comments can be submitted until July 6.

"USTR will hold hearings about the proposed actions in these investigations on July 7," the statement said.