{"id":40008,"date":"2026-07-24T22:19:54","date_gmt":"2026-07-24T16:49:54","guid":{"rendered":"https:\/\/banitoday.com\/12-5-to-10-why-trump-admin-imposed-reduced-tariff-rate-on-india-what-it-means\/"},"modified":"2026-07-24T22:19:54","modified_gmt":"2026-07-24T16:49:54","slug":"12-5-to-10-why-trump-admin-imposed-reduced-tariff-rate-on-india-what-it-means","status":"publish","type":"post","link":"https:\/\/banitoday.com\/hi\/12-5-to-10-why-trump-admin-imposed-reduced-tariff-rate-on-india-what-it-means\/","title":{"rendered":"12.5% to 10%: Why Trump admin imposed reduced tariff rate on India & what it means"},"content":{"rendered":"


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A total of 60 economies were being probed by the Donald Trump administration under the Section 301 probe. (AP Photo)<\/span><\/div>\n<\/section>\n<\/div><\/div>\n<\/div>\n

The Donald Trump<\/a> administration has announced a fresh set of tariffs as its Section 122 duties expire on July 24. The new tariffs, imposed under the Section 301 probe, see India being levied a reduced tariff rate of 10% as against the proposed 12.5% earlier and are effective immediately.The 10% tariff rate also extends to 16 other economies, including India\u2019s neighbours Bangladesh and Pakistan, and some developed economies like Canada and the United Kingdom. US Trade Representative Jamieson Greer announced the revised tariffs on 60 economies on Thursday, one day before the expiry of the temporary additional 10% duties that had been imposed on imports from all countries.A total of 60 economies were being probed by the Donald Trump administration under the Section 301 probe and a majority of them will now see a 12.5% tariff rate. What is the Section 301 probe? Why was India\u2019s tariff rate reduced from 12.5% to 10% and what does it mean for various sectors? We take a look:<\/p>\n

What\u2019s the Section 301 probe?<\/h2>\n<\/p>\n

Section 301 allows the US to investigate imports of goods that have been made using what it defines as \u2018forced labour\u2019 and impose tariffs on such goods. When the proposed tariffs were first announced on June 3 under Section 301 of the Trade Act, India had been placed in the category facing a 12.5% levy. <\/p>\n

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US Forced Labour Tariffs – What Changed for India<\/p>\n<\/div>\n<\/div>\n

Countries that do not have legal provisions banning the import of goods produced using forced labour\u2014including China and Japan\u2014will instead face a tariff of 12.5%.There are some exemptions to the tariffs: They do not apply to raw materials and agricultural inputs that cannot be produced in adequate quantities within the United States. They also exclude products whose taxation could trigger inflationary pressures or disrupt domestic supply chains.Some industrial inputs such as specified plastic resins, metal products and medical supplies, goods that are already covered under Section 232 tariffs, and informational or humanitarian items including books, personal baggage and charitable donations have also been exempted.For imports originating from the European Union, Japan, South Korea, Taiwan and Switzerland, the Section 301 tariff will be calculated on a net-of-MFN basis. This ensures that the combined tariff reaches the prescribed rate instead of adding the entire Section 301 duty on top of the existing Most Favoured Nation (MFN) tariff. <\/p>\n

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List of Section 301 tariffs faced by major countries<\/p>\n<\/div>\n<\/div>\n

For instance, if an imported product from the European Union already attracts a 3% MFN duty, only an additional 7% Section 301 tariff will be imposed so that the total duty reaches 10%, rather than applying a fresh 10% on top of the existing tariff.Following the latest decision, US tariffs on Indian exports broadly fall into three categories.<\/span><\/p>\n

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