The United States is India’s second-largest trading partner and largest market for exports. According to Commerce Department data, bilateral goods trade was approximately US$141 billion in 2025, with India’s exports accounting for US$87.3 billion.
The United States has imposed a 10% tariff on goods purchased from India and 16 other countries based on allegations that forced labor was used in their production. US Trade Representative Jameson Greer announced the new tariffs on 60 countries today under Section 301 of the Trade Act. This announcement came a day before the deadline for the additional 10% tariffs imposed on all countries was to expire.
The USTR statement said Greer, at the direction of President Donald Trump, took the final step of imposing tariffs under Section 301 of the Trade Act of 1974 on 60 economies that had failed to effectively enforce and prohibit imports of goods made with forced labor.
India was in the 12.5% tariff category
“This step will be a start towards correcting human rights violations and unfair trade practices, thereby improving the well-being of workers everywhere,” Greer said in a statement here. The 10% tariff rate applies to 17 countries, including India, Canada, the UK, Bangladesh, and Pakistan. Previously, India was among those subject to a 12.5% tariff.
Prohibition on the import of goods made with forced labor
A federal note on the matter noted that India had banned the import of goods made with forced labor after the proposed tariffs were announced in June. On June 14, India amended its foreign trade policy to ban the import of goods made with forced labor.
Tariffs declared illegal
The Trump administration launched these two investigations after the US Supreme Court in February invalidated last year’s reciprocal tariffs imposed using emergency powers. In response, the administration imposed a 10 percent tariff on all countries, which expires today.
Bilateral trade agreement under discussion
India has objected to both investigations initiated by the USTR and stated that these issues can be discussed under the bilateral trade agreement currently under negotiation. The United States is India’s second-largest trading partner and largest market for exports. According to Commerce Department data, bilateral goods trade in 2025 was approximately US$141 billion, with India’s exports accounting for US$87.3 billion.
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