US Trade Probe Targeting India Raises Export Concerns: EEPC India Chairman
The United States’ decision to launch a Section 301 investigation into 16 major trading partners, including India, has raised concerns within India’s engineering export sector, with industry body EEPC India warning that the move could eventually lead to fresh tariffs.The probe, initiated by the Office of the United States Trade Representative (USTR) under Section 301 of the US Trade Act of 1974, will examine whether certain economies maintain “structural excess capacity” in manufacturing through subsidies, suppressed wages or other policy measures that could distort global trade.
Apart from India, the investigation will cover China, the European Union, Japan, South Korea, Mexico, Taiwan, Vietnam, Thailand, Malaysia, Cambodia, Singapore, Indonesia, Bangladesh, Switzerland and Norway.
Section 301 is a US trade enforcement provision that allows the USTR to investigate foreign trade practices and impose measures such as tariffs or import restrictions if they are found to unfairly restrict American commerce.
Commenting on the development, Pankaj Chadha, Chairman of EEPC India, said the implications for India’s engineering exports would become clear only after the investigation concludes, but the move appears aimed at maintaining tariff pressure on trading partners.
“The US Trade Representative has launched a Section 301 investigation targeting India and other countries. While its impact on India’s exports will become clear only after the probe concludes, it appears the move could be aimed at imposing a new tariff once the 150 days for the current 10 per cent global tariff expires,” Chadha said.
Engineering Exports Face Fresh Uncertainty
According to Chadha, the development does not bode well for India’s engineering sector, particularly as tariff measures imposed during Donald Trump’s earlier administration continue to affect several export categories.
Tariffs of around 50 per cent on items such as steel, aluminium, automobiles and auto components remain in place, creating challenges for exporters seeking greater access to the US market.
Chadha also suggested that the latest probe may be intended to create leverage during trade negotiations between India and the United States.
He added that the engineering sector is already navigating multiple global headwinds, including geopolitical tensions and volatility in energy markets following recent developments in West Asia.
“The engineering sector has already been dealing with a lot of uncertainties, and the Section 301 investigation adds to the challenges,” he said.
The United States remains one of the largest markets for India’s engineering exports, making any potential tariff action under the Section 301 probe closely watched by the sector.
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