Trump Tariff Probes: The Donald Trump administration is launching two new trade investigations: one into excess industrial capacity among 16 major trading partners, including India, and another into forced labour practices. According to Reuters, the move is aimed at rebuilding tariff pressure after the US Supreme Court struck down the centerpiece of Trump’s tariff programme last month.
‘Section 301 trade probe could lead to new tariffs’
US Trade Representative Jamieson Greer said that the “Section 301” unfair trade practices investigation could lead to new tariffs imposed against China, the European Union, India, Japan, South Korea and Mexico by this summer.
Canada not among trading partners targeted by US probe
Other trading partners subject to the excess capacity probe include Taiwan, Vietnam, Thailand, Malaysia, Cambodia, Singapore, Indonesia, Bangladesh, Switzerland and Norway. Canada, the second-largest US trading partner, was not mentioned as a target of the probe, the Reuters report said.
“So these investigations will focus on economies that we have evidence appear to exhibit structural excess capacity and production in various manufacturing sectors, such as through larger persistent trade surpluses or underutilized or unused capacity,” Greer told reporters on a conference call.
The United States Trade Representative’s (USTR) official notice for the excess capacity probe cited the automotive sector in China and in Japan, and said a growing number of companies were unprofitable or unable to meet interest payments from operations, Reuters report added.
Another probe to ban US imports of goods produced with forced labour
Greer also said that he would initiate another probe under Section 301 of the Trade Act of 1974 to ban US imports of goods produced with forced labour. That investigation covers more than 60 countries, Reuters reported.
The US has already cracked down on solar panel imports and other goods from China’s Xinjiang region under the Uyghur Forced Labor Protection Act signed into law by former President Joe Biden, and the probe could expand such actions to other countries, Reuters reported.
Greer said he wanted other countries to enforce bans on goods produced with forced labor similar to those enshrined in a nearly century-old trade law, the report said.
The US alleges that Chinese authorities have established labor camps for ethnic Uyghur and other Muslim groups in the western region, though Beijing denies allegations of abuse, the Reuters report added.
Greer said that he hoped to conclude the Section 301 investigations, including proposed remedies, before new temporary tariffs imposed by Trump in late February expire in July, as per Reuter’s report.
After the Supreme Court struck down Trump’s global tariffs as illegal under a national emergencies law on February 20, he imposed a 10 per cent tariff for 150 days under Section 122 of the Trade Act of 1974, the report added.
What doe the probe mean to India?
The probe adds a new layer of uncertainty for India pertaining to its trade partnerships with the US as the Trump administration weighs various legal options to revive its tariff strategy after the court ruling.
