US to probe ‘unfair trade practices’ by India, 15 other countries, inquiry may lead to new tariffs

The Donald Trump administration in the United States on Wednesday launched a new investigation into alleged unfair trade practices by India and 15 other trading partners.

The investigation will look into allegations of structural excess capacity in manufacturing sectors. The United States has alleged that such excess capacity could lead to overproduction and persistent trade surpluses, allowing the countries to export low-priced goods into US markets.

US Trade Representative Jamieson Greer said that the investigation, launched under Section 301 of the country’s Trade Act, could lead to new tariffs being imposed on India, China, the European Union, Japan, South Korea and Mexico by this summer, Reuters reported.

The other countries that are being investigated are Taiwan, Vietnam, Thailand, Malaysia, Cambodia, Singapore, Indonesia, Bangladesh, Switzerland and Norway.

The move came weeks after the US Supreme Court on February 20 struck down most global tariffs imposed by Trump, ruling that he exceeded his authority in imposing the levies. Soon after the ruling, the US president signed a proclamation imposing a temporary 10% tariff on goods imported into the US, citing his authority under the 1974 Trade Act.

Against this backdrop, the US trade representative said that the country would “no longer sacrifice its industrial base to other countries that may be exporting their problems with excess capacity and production to us”.

“Across numerous sectors, many US trading partners are producing more goods than they can consume domestically,” Greer said. “This overproduction displaces existing US domestic production or prevents investment and expansion in US manufacturing production that otherwise would have been brought online.”

The US notice announcing the investigation said that in 2025 India had a bilateral trade surplus with the United States of $58 billion.

It claimed that there is evidence that “the solar module sector is plagued by excess capacity, including that India's current module manufacturing is nearly triple annual domestic demand”.

The notice alleged that India created “significant excess capacity” in petrochemicals, steel and other industries.

The US also alleged that China’s top electric vehicle maker BYD was “aggressively expanding its overseas distribution and production network” even though the country’s manufacturing capacity outstrips national demand.

Investigation into ‘forced labour’

Greer on Wednesday said that he would initiate another investigation under Section 301 of the Trade Act to ban imports of goods produced with forced labour in around 60 countries, Reuters reported.

The US has also barred imports of solar panels and other goods from China’s Xinjiang region under the Uyghur Forced Labor Protection Act.

The investigation announced on Wednesday could expand such actions to other countries.

The US trade representative said that he hoped to conclude both investigations before the temporary tariffs imposed by Trump expire in July.

In the investigation into allegations of structural excess capacity, public comments will be accepted till April 15, and a public hearing is slated to begin on May 5.