Will new US tariffs disrupt India-US trade talks? What Washington’s latest proposal means for India

New Delhi: The United States Trade Representative (USTR) has proposed new trade measures against 60 economies, including India, over what it describes as inadequate action to prevent the import of goods produced through forced labour.

The proposal follows investigations launched under Section 301 of the US Trade Act of 1974. According to the USTRthe identified economies have either failed to introduce effective prohibitions on such imports or have not adequately enforced existing restrictions.

India-US Trade Talks Face New Challenge

The development comes at a crucial moment for India and the United Stateswhich are currently engaged in negotiations aimed at finalizing the first phase of a bilateral trade agreement.

Officials from both countries have been holding discussions on market access, tariffs, agriculture and other key trade issues. The latest proposal could add complexity to those talks as both sides seek common ground on broader economic cooperation.

Proposed Tariffs Explained

Under the USTR proposalcountries that have adopted or committed to adopting forced-labor import restrictions through reciprocal trade agreements could face an additional 10 percent tariff.

For economies that do not meet those criteria, the agency has proposed a higher additional duty of 12.5 per cent. India is among the countries placed in the latter category, alongside China, Japan, South Korea, Brazil and several others.

Why the US Is Taking Action

USTR Ambassador Jamieson Greer argued that imports linked to forced labor create unfair competition for American businesses and workers. The agency maintains that stronger enforcement measures are necessary to prevent global supply chains from benefiting from exploitative labor practices.

The investigations began in March 2026 and included testimony from dozens of witnesses as well as hundreds of public comments. The proposed tariffs are currently subject to a consultation process before any final decision is made. Public comments will be accepted before hearings scheduled for July.