US imposes 10% forced labour tariff on India under Section 301
UPSC / SSC current affairs note · Economy
Why in news
The United States has imposed a 10% tariff on imports from India under Section 301 of the Trade Act of 1974, citing forced labour concerns. This places India on par with Pakistan, Sri Lanka, and Bangladesh, and is part of a broader action against 60 countries. The tariff replaces a temporary global tariff and follows a months-long investigation.
Background
Section 301 of the Trade Act of 1974 allows the US to impose retaliatory trade measures against countries engaging in unfair or discriminatory practices. The Trump administration launched two Section 301 investigations in March 2026, one on forced labour and another on excess manufacturing capacity (still ongoing). India faced a proposed 12.5% tariff but secured a lower 10% rate after consultations.
Key facts
US imposed a 10% tariff on imports from India and over a dozen other countries under Section 301 for forced labour practices.
The tariff applies to 60 countries accounting for more than 99% of US imports.
India's tariff is lower than the originally proposed 12.5%.
The new tariffs replace the temporary 10% global tariff announced in February 2026, which expired this week.
US Trade Representative Jamieson Greer stated the action aims to correct human rights abuse and distortive trade practices.
India defended its record citing constitutional provisions prohibiting forced labour during public consultations.
India faces a separate ongoing Section 301 investigation into alleged excess manufacturing capacity.
Unlike Section 122 tariffs, Section 301 tariffs have no rate ceiling or expiry date but require a formal investigation.
Prelims pointers
- Section 301 of the Trade Act of 1974
- Section 122 tariffs
- Office of the US Trade Representative (USTR)
- Forced labour
- 10% tariff
- India-US trade relations
Mains angles
- Discuss the implications of US Section 301 tariffs on India's trade and human rights image.
- Critically examine the use of trade measures to enforce labour standards.
- Analyze India's response to US allegations of forced labour and its impact on bilateral relations.