Indian officials to counter US tariff move at USTR hearing

India is set to challenge the proposed US tariffs on exports with the US Trade Representative next week, contending that the findings on forced labour are legally flawed and would affect American businesses and consumers.

Representatives from the commerce ministry as well as industry bodies, such as APEDA, FICCI, CII and ACMA, are scheduled to present India’s counter to the USTR proposal to impose tariffs at a public hearing on July 8.

India has already, in written submissions, said that the USTR’s findings do not take into account the country’s robust domestic legal regime reflecting a structured and progressive approach combining statutory prohibitions, institutional mechanisms, and ongoing policy measures aimed at reducing vulnerability to forced labour.

In its counter to the proposed tariffs, the Confederation of Indian Industry (CII) has said India’s policy framework does not qualify as ‘unreasonable’ or ‘discriminatory’ under Section 301(b) of the Trade Act of 1974. The CII also asserted that India has a robust constitutional and statutory framework that ensures Indian companies cannot practice forced labour.

The Federation of Indian Chambers of Commerce and Industry (FICCI), in its written response, has said that Indian export supply chains serving the US market operate within well-established compliance frameworks that emphasise traceability, supplier due diligence, independent audits and responsible sourcing practices.

The Automotive Component Manufacturers Association (ACMA) said that the Indian auto-component manufacturing is predominantly organised, technology-driven, and subject to established labour and compliance frameworks. Accordingly, the use of forced labour is neither inherent in nor consistent with the sector’s legitimate operating practices.

The All India Spice Exporters Forum and the All India Vegetables Dehydrated Manufacturers' Development Association have also made their written submissions to the USTR on the issue.

Last month, the USTR proposed a 12.5 per cent additional duty on Indian goods over forced-labour import rules, invoking Section 301 of the Trade Act of 1974. It proposed similar action against many other countries.

Section 301 is considered one of the US’ most powerful unilateral trade tools that allows it to investigate foreign trade practices and impose tariffs or other restrictions.