Why has the US proposed trade action against India and 59 other economies?

Washington: The United States Trade Representative (USTR) has proposed trade measures against India and 59 other economies after concluding that their handling of imports linked to forced labour places an unfair burden on US commerce.

The findings stem from a Section 301 investigation conducted under the US Trade Act of 1974. In a statement released Tuesday, the USTR said the countries' actions, policies and practices regarding forced labour imports were "unreasonable" and restricted American trade interests.

India included in list of 54 economies

India was among 54 economies that the USTR said have not put in place, or effectively enforced, bans on goods produced through forced labour.

Other economies named by the agency include Australia, Bahrain, Bangladesh, China, Japan, Kuwait, Saudi Arabia, Singapore, the United Kingdom and the United Arab Emirates.

US Trade Representative Jamieson Greer said the situation disadvantages American workers and companies.

"The failure of our most important trading partners to address the importation of goods made with forced labor is unacceptable. This creates a dynamic where American workers are forced to compete globally on an unlevel playing field," Greer said.

Tariffs under consideration

Following the investigation, the USTR has proposed imposing additional import duties on products from the affected economies and has opened a public consultation process.

Under the proposal, countries that have already adopted, or pledged to adopt, restrictions on forced labour imports could face an additional tariff of 10 percent.

Economies that have not taken such steps could be subject to a 12.5 percent duty.

The agency is also considering a separate mechanism covering certain textile and apparel imports.

Months-long investigation

The inquiry began on March 12 and included testimony from nearly 60 witnesses.

The USTR said it also reviewed approximately 500 public submissions before reaching its conclusions.

According to the agency, the absence of effective import bans on forced labour products weakens global efforts to eliminate such practices. It argues that the situation allows lower-cost goods to enter markets, harms companies that comply with labour standards and creates opportunities to bypass existing trade restrictions.

Move comes during India-US trade talks

The proposal arrives as India and the United States continue negotiations on the first phase of a bilateral trade agreement.

Officials from both countries have held several rounds of discussions in recent months, with talks covering tariffs, market access, agriculture and digital trade.

The latest USTR action also follows months of trade tensions linked to President Donald Trump's reciprocal tariff policy. Earlier this year, India was among the countries facing the prospect of higher US tariffs before Washington paused some measures to allow further negotiations.

New Delhi has maintained that it is seeking a balanced trade deal that benefits both countries while protecting sensitive domestic sectors.

Final decision yet to be made

The United States remains India's largest trading partner, with bilateral goods trade exceeding $120 billion in recent years.

The USTR has invited written comments on the proposed measures until July 6 and plans to hold public hearings on July 7.

The agency noted that the findings do not automatically trigger tariffs. However, Section 301 investigations can eventually lead to duties, quotas or other trade restrictions if the US administration decides to proceed.

With agency inputs