India urges US to reconsider proposed 12.5% tariff over 'forced labour' probe

India has urged the United States to withdraw its proposal to impose an additional 12.5% tariff on Indian imports under a Section 301 investigation into forced labour-related trade practices, saying the move is not supported by adequate evidence or a country-specific assessment.In a detailed submission to the Office of the United States Trade Representative (USTR) dated July 6, India argued that the investigation does not establish how its laws or policies amount to an "unreasonable" trade practice under Section 301. It also said Washington had failed to demonstrate that India's regulatory framework causes any measurable harm to US industry, reported PTI.This came as USTR initiated two separate Section 301 investigations in March this year, examining 60 economies claiming concerns related to forced labour and industrial overcapacity. Based on the findings of the forced labour probe, the US trade body proposed additional duties on imports from 54 economies in June.Under the proposal, India is among 48 economies that could face an additional 12.5% tariff, while countries including Canada, the European Union, Indonesia, Mexico, Ecuador and Pakistan would be subject to a lower 10% duty. The proposal is still under consultation and has not been implemented.India contended that the USTR had adopted a broad approach instead of evaluating the legal framework and enforcement mechanisms of each economy individually. It maintained that the findings do not sufficiently establish that India's existing policies distort trade or provide exporters with an unfair competitive advantage."In view of the claims advanced, the identified gaps and lack of a sufficient basis, India requests the United States to reconsider the proposed imposition of tariffs against India. India remains willing to engage constructively with the USTR through consultation and dialogue on any specific concern," the submission said.The government further argued that the investigation does not provide evidence linking India's export sectors to forced labour or proving that the absence of an import prohibition on goods produced with forced labour disadvantages American businesses. "India submits that a mere absence of a forced labour import prohibition, without meeting the evidentiary basis of other statutory requirements, cannot be construed as 'unreasonable' within the meaning of Section 301 of the Act," it added.India also maintained that the USTR had not demonstrated how the lack of such a prohibition substantially distorts market conditions or undermines the competitiveness of companies that comply with labour standards.The USTR is holding public hearings on the proposal before taking a final decision. Written submissions and oral testimony will be considered before the agency determines whether to proceed with the additional tariffs.Get the latest business news and top stories. Download the TOI App.Ready to Make a Smarter Property Decision? Build Your Legacy with TOI Homes.