In Brief: U.S. announces 10% tariffs on forced-labour imports; Centre says about 45% of India’s exports unaffected

What happened: U.S. forced-labour tariffs and India’s export carve-outs

The United States announced permanent tariffs on imports from 60 trading partners for goods associated with forced-labour measures. Following the announcement, the Government of India stated that around 45% of India’s exports to the United States fall outside the scope of a new additional 10% tariff.

The Government of India also described the structure of the tariff and its exceptions in order to estimate the share of exports not hit by the new additional duty. The key points in the Government statement, as reported, are below.

Additional 10% duty level: India’s statement said the additional 10% duty is lower than an earlier U.S. proposal of 12.5% for India and some other countries.Textile exports: India said it remains engaged with the United States on a quota-based arrangement for textile exports.Products said to be exempt or outside the additional duty scope: India’s statement listed categories such as generic pharmaceuticals and smart phones as currently attracting zero additional duties (as per the reported statement).Exclusion for products covered under U.S. Section 232: India’s statement said products already covered under U.S. Section 232 (including steel, aluminium and auto parts) are not subject to the additional 10% duty.Why Section 232 is not treated as a unique disadvantage: India’s statement noted that Section 232 duties levied last year range around 25–50% and apply broadly across countries, so India is not uniquely disadvantaged (as per the reported statement).Net export estimate: after accounting for exemptions and exclusions, the Government estimated that about 45% of Indian exports remain outside the additional 10% duty.

Background and earlier position: tariff design and existing duties

The Government of India’s estimate relies on the distinction between (1) an additional forced-labour-related tariff and (2) other U.S. tariff categories already applied broadly, especially Section 232. Section 232 is a U.S. tariff mechanism under which duties have been applied to certain industrial goods. The Government of India, as reported, pointed out that the new additional 10% duty is not meant to stack on top of products already inside Section 232.