India has urged the U.S. to reconsider a proposed 12.5% tariff, advocating for bilateral negotiations to address trade disputes rather than unilateral measures linked to a Section 301 investigation.
India is calling on the United States to reconsider its proposed 12.5% tariff, emphasizing that trade-related concerns should be resolved through bilateral negotiations rather than through unilateral actions. This request comes in response to the Office of the United States Trade Representative (USTR) and its Section 301 investigation into forced labor practices.
During a public hearing on July 8, Indian officials argued that the USTR’s findings contain inconsistencies and do not meet the legal standards outlined under U.S. trade law. The transcript from this hearing was subsequently published on the USTR’s website.
Joint Secretary in the Department of Commerce, Brij Mohan Mishra, represented India at the hearing. He stated that India has been actively addressing concerns related to forced labor and strongly disagrees with the conclusions drawn by the USTR. Mishra emphasized that India views the elimination of forced labor as both a constitutional responsibility and an international obligation.
“India would like to highlight its concerns with the USTR’s report and findings against India,” Mishra said. He argued that the USTR has not satisfied the legal requirements set forth under Section 301(d) of the U.S. Trade Act.
Mishra pointed out that the absence of a specific ban on imports made with forced labor does not automatically render India’s trade practices unreasonable under Section 301, especially without sufficient supporting evidence.
India also criticized the methodology employed in the USTR investigation, claiming it relied on a limited number of case studies and broad global trade patterns rather than country-specific evidence. Mishra noted that the report assumes that imports flagged for forced labor in certain countries eventually reach the U.S. market, without establishing any direct connection between those imports and India’s exports.
Furthermore, he argued that the report fails to provide adequate evidence that India’s policies create an unfair competitive advantage or harm American industries. The Indian government contended that the USTR’s recommendation unfairly categorizes 46 economies, including India, under a single umbrella without offering separate justifications for imposing countrywide tariffs.
In concluding his submission, Mishra urged the USTR to withdraw the proposed tariff after reviewing the inconsistencies identified in the investigation. “In conclusion, it is submitted that the USTR reconsider the imposition of tariff in light of the identified inconsistencies in the report in the Federal Register notice. We ask that any trade problems be addressed within the framework of the India-U.S. bilateral trade negotiation, not through unilateral measures such as this investigation,” he stated.
Mishra reiterated India’s willingness to engage in discussions with the USTR through consultations and constructive dialogue to resolve any specific concerns.
In addition to government representatives, industry voices also weighed in on the proposed tariff. Shreyans Gupta, First Secretary at the Embassy of India in Washington, D.C., represented the Agricultural and Processed Food Products Export Development Authority (APEDA). He challenged the USTR’s claims regarding rice imports allegedly produced with forced labor. Gupta noted that India’s rice imports are minimal and primarily cater to niche demands for specific rice varieties.
According to Gupta, the total value of rice imported into India constitutes less than three percent of the value of rice exported from India to the United States. He emphasized that India has strict regulatory safeguards to ensure that imported rice produced with forced labor cannot be re-exported to the U.S. Only rice processed at mills and units registered with India’s agriculture ministry is permitted for export to the American market.
“For these reasons, the present investigation against India may be rescinded without prejudice,” Gupta said, while requesting that Indian rice be exempted from the proposed tariff if the investigation continues.
Indian industry organizations have also expressed opposition to the proposed tariff during the consultation process. The Federation of Indian Chambers of Commerce and Industry (FICCI) cautioned that the additional duty should be carefully reconsidered, as it would increase costs across the supply chain.
“An additional tariff will increase costs not only for Indian exporters but also for U.S. manufacturers, importers, retailers, and ultimately, American consumers,” the chamber stated. FICCI added that higher tariffs would escalate expenses for businesses already complying with regulatory standards and could disrupt reliable India-U.S. supply chains.
The Confederation of Indian Industry (CII) also contended that the proposed 12.5% tariff is not supported by the evidence presented in the investigation. According to CII, the USTR report does not establish that India’s policy framework places an unfair burden on U.S. commerce.
The USTR launched two separate Section 301 investigations on March 11 and 12, 2026, covering 60 economies due to concerns related to forced labor and excess industrial capacity. On June 3, it released findings from the forced labor investigation and proposed additional tariffs on imports from the affected economies.
The proposal recommends a 10% tariff on imports from Canada, Ecuador, the European Union, Indonesia, Mexico, and Pakistan, while imports from 54 other economies, including India and China, would face a proposed 12.5% tariff.
This proposal has not yet been finalized. The USTR is currently reviewing public comments and testimony submitted during the hearing before making a final decision on whether to implement the proposed tariffs, according to The Sunday Guardian.