US announces fresh section 301 tariff, 10% levy on India

The United States have levied fresh tariff in the range of 10 per cent – 12.5 per cent on 60 largest trading partners including India, following its investigations under Section 301(b) of the Trade Act of 1974. The investigations pertain to Failure to Impose and Effectively Enforce a Prohibition on the Importation of Goods Produced with Forced Labour.

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Ambassador Jamieson Greer took final action, at the direction of President Trump, in the Office of the U.S. Trade Representative. Action applies to the top 60 U.S. trade partners covering 99.4 per cent of U.S. imports, according to an official statement.

The U.S. has reduced the proposed forced-labour tariff on Indian exports 10 per cent from 12.5 per cent, acknowledging India’s decision to ban imports made with forced labour, Ajay Srivastava, Founder, Global Trade Research Initiative said in a Linkedin post.

However, he pointed out the reduction is not tariff relief—it is a replacement.

“The temporary 10 per cent Section 122 tariff has simply been converted into a more permanent Section 301 tariff,” Srivastava pointed out.

Around 60-70 per cent of India’s exports to the U.S.—including engineering goods, textiles, garments, chemicals, machinery, plastics, leather, furniture, gems and jewellery—will now pay normal U.S. tariffs (MFN) plus an additional 10 per cent Section 301 duty, he said.

Products already under Section 232—such as steel, aluminum, copper and auto parts—continue to face 25 per cent or 50 per cent tariffs, with no change, Srivastava said.

India also did not receive the textile tariff-rate quota (TRQ) exemption granted to Bangladesh, Cambodia, Indonesia and Malaysia for specified exports using U.S.-origin cotton and fibre, he noted.

The Trump administration has ensured that the expiry of the temporary Section 122 tariffs does not reduce the overall U.S. tariff wall. Instead, it has shifted to Section 301 to keep duties in place under a different legal framework, Srivastava said.

Washington is expected to conclude another Section 301 investigation into excess manufacturing capacity, which could trigger additional tariffs on industrial products in the coming weeks, he pointed out.

Indian businesses should prepare for a future in which U.S. tariffs are no longer temporary disruptions—but a permanent feature of global trade, Srivastava said.

About Section 301:

Section 301 of the Trade Act of 1974 is designed to address unfair foreign practices affecting U.S. commerce. Section 301 may be used to respond to unjustifiable, unreasonable, or discriminatory foreign government practices that burden or restrict U.S. commerce. Under Section 302(b) of the Trade Act, the United States Trade Representative may self-initiate an investigation under Section 301.

An investigation under Section 301(b) of the Trade Act examines whether the acts, policies, or practices of a foreign country are unreasonable or discriminatory and burden or restrict U.S. commerce.

For more details: https://ustr.gov/about/policy-offices/press-office/fact-sheets/2026/july/fact-sheet-ustr-section-301-action-response-failure-60-economies-ban-imports-produced-forced-labor

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