A statement by India’s Ministry of Commerce and Industry on Saturday (July 25) has indicated that the country has been placed in the lower tier of additional tariffs under the final measures by the United States Trade Representative (USTR), which has provided a relative advantage to Indian exports in key sectors.On July 23, the United States Trade Representative (USTR) had announced the final measures under Section 301 of the US Trade Act, 1974 after an investigation into the acts, policies and practices of 60 economies, including India, relating to the imposition and enforcement of prohibitions on the importation of goods produced with forced labour.
Commenting on the USTR’s imposition of an additional 10% ad valorem duty on imports from India, the Commerce Ministry said that the Indian Government remained closely engaged with the USTR throughout the investigation through detailed written submissions and in-person consultations, including participation in public hearings.
ALSO READ | India-UK trade deal gives Indian exporters an edge over China, says Commerce SecretaryThe statement noted that a substantial share of India’s exports to the United States, which currently attract zero additional duties, include generic pharmaceuticals, smartphones and certain other specified products, continue to remain outside the scope of the additional 10% duty, while products already covered under Section 232 measures like steel, aluminium and auto parts are not subject to the additional 10% duty. Section 232 duties are applicable broadly to all countries with limited exceptions.The Indian government said that due to exemptions, 45% of India’s exports to the United States remain outside the purview of the additional 10% Section 301 duty, while the remaining 55% of exports will attract an additional 10% duty, where India’s tariff incidence is comparatively lower than that for most other economies covered by the investigation.Noting that the textile-specific mechanism referenced in the final measures is yet to be established and operationalised, the government has said that India continues to engage with the US on this matter as part of the ongoing negotiations for the India-US Bilateral Trade Agreement (BTA).ALSO READ | India’s proposed e-commerce rule change could benefit Amazon, other foreign firms: GTRIIt added that the government remains committed to working with the United States towards the early conclusion of the India-US Bilateral Trade Agreement, as announced on 2nd February 2026 and in accordance with the Joint Statement issued on 7th February 2026.India has joined 16 other economies in the lower 10% tariff band, while 43 countries face a higher 12.5% duty. 17 economies, including India, Canada, the United Kingdom, Bangladesh and Pakistan, will face 10% tariffs, 2.5% lower than 43 other countries.However, India hasn’t received a textile and apparel tariff-rate quota (TRQ) exemption under the new US Section 301 forced-labour tariff, where an exemption has been given to specified volumes of textile & apparel exports from Bangladesh, Cambodia, Indonesia, and Malaysia using US-origin cotton and fibre.Most Indian exports to the US face weighted average MFN tariffs of 2.8%. MFN tariffs in the US apply to most products except metals like steel, copper, aluminium, or auto components.ALSO READ | Dumped imports, inverted duties hurting India’s manufacturing push across key sectors, reports warn(Edited by : Jomy Jos Pullokaran)First Published: Jul 25, 2026 4:36 PM IST
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