India asks US to reconsider proposed 12.5% tariffs on imports
What's the story
India has asked the United States to reconsider its proposed 12.5% tariff on imports from 54 economies, including India and China. The proposal was made by the United States Trade Representative (USTR) during a Section 301 investigation into forced labor concerns. According to PTI, Joint Secretary in India's Department of Commerce Brij Mohan Mishra argued that trade issues should be resolved through bilateral negotiations instead of unilateral measures like this investigation.
Evidence dispute
USTR's findings don't meet legal standards: Mishra
Mishra also questioned the USTR's findings, saying they don't meet legal standards under Section 301(d) of the Trade Act. He said that a lack of forced labor import prohibition can't be deemed unreasonable without evidence of other statutory requirements. The USTR's determination wrongly groups 46 economies into one category and relies on case studies from a few economies, he added.
Rice concerns
India has minimal rice imports: Shreyans Gupta
Shreyans Gupta, First Secretary at the Embassy of India in Washington, DC, also raised concerns about USTR's observations on rice imports allegedly made with forced labor. He pointed out that India's rice imports are minimal and cater to niche demands. Gupta stressed that there are regulatory checks preventing exports from India of imported rice produced with forced labor.
Chamber response
Ficci calls for re-evaluation of proposed additional tariff
Industry chamber FICCI has also called for a re-evaluation of the proposed additional tariff, saying it would increase costs for Indian exporters and American consumers. The Confederation of Indian Industry (CII) said the proposed tariff isn't backed by evidence and won't achieve its policy goal. FICCI stressed that India's legal safeguards and compliance mechanisms should be considered before finalizing any tariffs.
Investigation scope
USTR launched 2 Section 301 investigations covering 60 economies
The USTR launched two Section 301 investigations covering 60 economies over forced labor and excess industrial capacity concerns. On June 3, it proposed additional tariffs on imports from these economies. The measure includes a 10% tariff on imports from Canada, Ecuador, the EU, Indonesia, Mexico, and Pakistan, and a 12.5% tariff on imports from India and China, among others.