US News: Trump Trade Team In Delhi, Trump Plans New Tariffs On India Over “Forced Labour”

Washington:

The United States is planning to impose new tariffs on at least 60 trading partners for alleged failures to act against forced labour, as the Donald Trump administration seeks to rebuild its tariff agenda following legal setbacks. The tariffs, proposed by the US Trade Representative (USTR), range from 10 per cent to 12.5 per cent, according to a government filing.

According to the USTR report released early Wednesday, Canada, Mexico, Taiwan and the United Kingdom would face 10 per cent tariffs for allegedly failing to enforce a forced labour import ban. A 12.5 per cent additional tariff would be imposed on China, Japan, India, South Korea, Brazil and Switzerland, among other nations.

The new tariffs would not take effect immediately. They are subject to public comment and review. But if implemented, the move would enable US President Donald Trump to skirt limits on his tariffs imposed by the Supreme Court.

How Trump Plans To Impose More Tariffs

The move comes months after Washington launched investigations into trading partners under Section 301 (b)(1) of the Trade Act of 1974, seeking to see whether they took action against the import of goods made with forced labour and if this impacted US commerce.

On Tuesday, the USTR said that 54 of the economies “failed to impose and effectively enforce a forced labour import prohibition”.

This group includes China, India, Bangladesh, Vietnam, Taiwan, Iraq, Israel, Japan, Qatar, Russia, Saudi Arabia, Singapore, the United Arab Emirates (UAE) and the United Kingdom (UK), among others. Six other economies — Canada, Ecuador, the EU, Indonesia, Mexico and Pakistan — were deemed not to have effectively enforced such prohibitions.

“The failure of our most important trading partners to address the importation of goods made with forced labour is unacceptable,” USTR Jamieson Greer said in a statement.

“This creates a dynamic where American workers are forced to compete globally on an unlevel playing field,” he added.

But the proposed tariffs come with various exemptions such as beef, coffee and certain fruits and nuts. Goods from Canada and Mexico that comply with a North American free trade pact will also be exempt — as will certain textiles and apparel.

The public is invited to provide written comments by July 6, and the USTR will subsequently hold hearings.

After the Supreme Court struck down a swath of President Donald Trump’s tariffs in February, US officials launched the new trade probes as steps toward imposing more lasting duties.

Apart from the investigations on forced labour, the US trade envoy also started probes on excess industrial capacity.

US Trade Team In Delhi

A team of officials from the United States Trade Representative (USTR), led by chief negotiator Brendan Lynch, are in New Delhi for trade talks with India. These talks are focused on finalising an interim trade agreement between the two countries. The discussions follow the framework agreed upon by both sides in February.

India’s negotiating team will be led by Darpan Jain, additional secretary in the Department of Commerce. According to the commerce ministry, the two countries are working on finalising details of the interim pact while advancing negotiations under the proposed Bilateral Trade Agreement (BTA).

Key areas of discussion include market access, non-tariff barriers, customs and trade facilitation, investment promotion and economic security cooperation. 

New Delhi and Washington issued a joint statement on February 7, outlining the framework for the first phase of a BTA. The key highlight of this proposed agreement was that the US agreed to lower tariffs on Indian goods to 18 per cent and remove certain duties linked to India’s purchase of Russian oil. The proposed tariff reduction comes as a major relief for India after months of trade tensions with the US. Earlier, steep tariffs of up to 50 per cent had affected Indian exports and investor sentiment.