India bans import of goods made using forced labour amid pending U.S. probe, Pg13

Key Highlights:

• India has prohibited the import of goods manufactured using forced labour, as notified by the Ministry of Commerce and Industry.
• This measure aligns with the definition of forced labour provided by the ILO Forced Labour Convention, 1930 (No. 29).
• The ban is a response to a pending U.S. Section 301 investigation which proposed a 12.5% tariff on imports from countries, including India, found to be failing in prohibiting forced labour goods.
• The Directorate General of Foreign Trade (DGFT) will establish procedures for inquiries into the use of forced labour in imported goods.

Detailed Insights:

• The new prohibition is a significant step towards potentially finalizing an interim trade agreement between India and the U.S.
• The U.S. probe, conducted by the U.S. Trade Representative (USTR), identified India among 54 countries that allegedly "failed to impose and effectively enforce" prohibitions on forced labour imports.
• India has formally protested the proposed U.S. tariffs and submitted its position on the matter.
• Indian officials have indicated that any trade deal with the U.S. would only be signed if it ensures a comparative advantage for India over its competitors.
• This policy shift integrates international labour standards into India's Foreign Trade Policy, moving beyond reliance solely on domestic labour and criminal laws.
• The notification empowers the central government to specify goods whose import shall be prohibited, with the provisions coming into effect 30 days after publication.
• The U.S. is also conducting a separate investigation into whether its trade partners are using excess capacity to export, potentially harming the American economy.

Key Concepts Involved:

• Forced Labour: All work or service exacted from any person under the menace of any penalty and for which the said person has not offered himself voluntarily, as defined under the ILO Forced Labour Convention, 1930 (No. 29).
• Interim Trade Agreement: A preliminary trade pact designed to address immediate trade issues and build confidence before a more comprehensive agreement is negotiated.
• Directorate General of Foreign Trade (DGFT): An agency under the Ministry of Commerce and Industry responsible for formulating and implementing India's Foreign Trade Policy and regulating imports and exports.
• Section 301 Investigation: A provision under U.S. trade law that allows the U.S. Trade Representative (USTR) to investigate and take action against foreign trade practices deemed unfair or discriminatory to U.S. commerce.