US Tariffs Indian Imports:Around 45% of India’s exports to the United States will remain outside the scope of the additional 10% tariff imposed by Washington under its Section 301 investigation related to alleged forced labour concerns, the government said on Saturday.
The commerce and industry ministry said a textile-specific mechanism mentioned in the final US measures has not yet been established. It added that India is continuing discussions with the US on the matter as part of the ongoing negotiations for a proposed bilateral .
45% of Indian exports exempt from new tariff
“The remaining 55% of exports will attract the additional 10% duty, where India’s tariff incidence is comparatively lower than that for most other economies covered by the investigation,” the ministry said.
India exported goods worth $87.3 billion to the US during FY26.
“As a result of these sustained efforts, India has been placed in the lower tier of additional tariffs under the final measures, providing a relative advantage to Indian exports in key sectors,” the ministry said.
US lowers final tariff from proposed rate
On Thursday, the Office of the US Trade Representative (USTR) announced the final outcome of its Section 301 investigation under the US Trade Act of 1974, levying an additional 10% ad valorem duty on from India. The final rate is lower than the 12.5% tariff proposed on June 2.
According to the ministry, the Indian government remained actively engaged with the USTR throughout the investigation by submitting detailed written responses, participating in consultations, and attending public hearings.
Key sectors remain outside the scope of new duties
The government also pointed out that a significant portion of Indian exports to the US—including generic medicines, smartphones and several other specified products—will not face the new 10% tariff because they are already exempt from the additional duties. Products already covered under Section 232 measures, such as steel, aluminium and auto parts, are also excluded from the latest tariff. Section 232 duties apply broadly across countries, with only limited exemptions.
Gem and jewellery exporters flag competitive challenges
Meanwhile, the Gem and Jewellery Export Promotion Council (GJEPC) dismissed any suggestion that India’s gem and jewellery industry is associated with forced labour. The industry body said the new tariff still leaves Indian exporters with a 2.5 percentage-point advantage over key competitors such as China and Hong Kong, which are subject to a higher 12.5% additional duty.
However, GJEPC cautioned that the tariff would still create challenges for Indian exporters. It noted that major rival diamond trading hubs in Europe and Africa continue to enjoy duty-free access for natural diamonds in the US market, placing Indian exporters at a competitive disadvantage despite the relatively lower tariff.