America proposes to impose 12.5 percent additional tariff on India. However, not only India, the US Department of Commerce has proposed to impose these tariffs on a total of 60 countries, including India, using Article 301 of the US Act. Under US law, the tariffs are proposed to ban imports of goods made with forced labor. Needless to say, this step of the Trump administration in the midst of the crisis created around the world due to the war in the Middle East is of considerable concern to India.
According to the US Department of Commerce, among the 60 countries that have been proposed to impose additional tariffs of 12.5 percent, India, China, Japan, South Korea, Britain, and several Southeast Asian countries are noteworthy. The White House claims the move is aimed at countries that have failed to impose restrictions on products made with forced labor and that have failed to enforce such laws. Countries that have imposed a full or partial ban on forced labor-based imports may face a 10 percent tariff, and those that have implemented no such ban may face a 12.5 percent tariff. However, this proposal is still under discussion. The US administration will take a final decision on this issue only after receiving and reviewing public opinion.
The law was used to impose tariffs on Chinese imports during President Donald Trump’s first term.
Significantly, the US proposal for such tariffs comes at a time when talks on a bilateral trade agreement are underway between Delhi and Washington. The main aim of the talks, which will be held from June 2 to June 4, is to reduce the trade barriers between the two countries and eliminate customs complications. In the meantime, such proposals are undoubtedly worrying.
Note that in 1974 America passed this trade law. Section 301 of the Act gives the US Department of Commerce the power to investigate foreign commercial activity and take retaliatory action. If the government believes that the foreign commercial activity is unfair or harmful to U.S. commerce. But America took strict action against that country. The law was used to impose tariffs on Chinese imports during President Donald Trump’s first term.
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