India’s top industry bodies have appealed to the United States Trade Representative (USTR) to abandon the planned 12.5% tariff on Indian imports. They argued that Indian businesses already adhere to strict labor and environmental regulations, and imposing broad tariffs would escalate costs for American manufacturers without effectively addressing forced labor concerns.
At a USTR Section 301 hearing, representatives from the Federation of Indian Chambers of Commerce and Industry (FICCI) and the Confederation of Indian Industry (CII) emphasized their support for eradicating forced labor from global supply chains. However, they contested the rationale behind imposing economy-wide tariffs on India.
Poornima Shenoy, presenting FICCI’s stance, highlighted that Indian enterprises have heavily invested in responsible sourcing, supply chain diligence, and environmental, social, and governance (ESG) compliance. She expressed concerns that the proposed tariff lacked specificity and suggested that a targeted, evidence-based approach would be more effective in addressing supply chain risks.
Shenoy underscored that India’s legal framework already safeguards labor rights through stringent laws, enforcement mechanisms, and compliance measures. She cautioned that additional tariffs would escalate costs for both Indian exporters and U.S. stakeholders, emphasizing the importance of existing compliance mechanisms in ensuring quality and reliability in trade relationships.
Representing CII, Shuchita Sonalika echoed similar sentiments, stating that the 12.5% additional duty was unwarranted and could penalize compliant industries without advancing the intended policy objectives. She outlined India’s robust legal framework against forced labor and emphasized the country’s adherence to global compliance standards across various sectors.
Both industry bodies urged the USTR to reconsider the proposed tariffs, citing India’s legal protections, established compliance frameworks, and the significance of resilient U.S.-India supply chains. They advocated for cooperation and dialogue over trade restrictions, asserting that enhanced compliance measures offer a more viable solution to addressing forced labor issues.
