“Under the action taken on the basis of Section 301 regarding allegations related to forced labor, the United States has placed India in the lowest 10 percent tariff bracket,” the central government said.
The U.S. Supreme Court recently struck down the reciprocal tariffs imposed by U.S. President Donald Trump on 60 countries, including India, accusing them of engaging in unfair trade practices against the United States.
Following that ruling, Trump announced that the United States would impose this reciprocal tariff on countries around the world through alternative means, and he imposed a new uniform 10 percent reciprocal tariff on goods from India and other countries worldwide for 150 days starting February 24.
In addition, the United States ordered a new investigation through the U.S. Trade Representative (USTR) under Section 301 of the U.S. Trade Act of 1974, with the aim of determining the extent to which the unfair trade practices of trading partner countries including India, China, and Japan have affected American manufacturing.
Accordingly, USTR representative Jamieson Greer, who conducted an intensive review, recommended imposing an additional 12.5 percent tariff on goods imported from 54 countries, including India.
Based on this recommendation, the United States imposed a new tariff on countries including India last Friday.
In that, the United States imposed a 10 percent tariff on 17 countries, including India. Taking note of the amendments India made to its foreign trade policy on July 14 to prevent the export of goods produced using forced labor, the US reduced the tariff to 10 percent, the USTR said.
At the same time, the United States imposed a 12.5 percent tariff, as previously recommended by the USTR, on 43 countries, including China, Britain, and Japan, which have not enacted laws to prevent the export of goods produced using forced labor.
India welcomes: India welcomed the fact that it has been placed in America’s lower tariff bracket.
Regarding this, the Union Ministry of Commerce said in a press release issued on Saturday: In the investigation conducted by the USTR under Section 301 of the US Trade Act of 1974, India has continuously presented its views and justification, both in writing and directly.
As a result, the United States has placed India in the very low 10 percent tariff bracket. This will create a favorable environment for India’s exports in key sectors.
Moreover, the currently announced 10 percent tariff is not being imposed in addition to the existing duties on goods already covered under Section 232 of the U.S. Trade Act, including steel, aluminum, and auto parts. These goods, which account for 45 percent of India’s exports to the United States, are outside the tariff scope of Section 301. Therefore, the current 10 percent tariff does not apply to them. This 10 percent tariff applies only to the remaining 55 percent of Indian export goods. In the USTR investigation, it was stated that the tariff imposed on Indian goods is lower compared with the customs duties the United States has imposed on other countries.
Moreover, trade practices related to the textile sector have not yet been implemented. In the ongoing bilateral trade agreement negotiations between India and the United States, the speedy implementation of textile-sector-related practices will be discussed. The Ministry of Commerce also said that India continues to engage with the United States on the matter of swiftly finalizing the bilateral interim trade agreement.