The United States has named India and more than 40 other countries in a new report alleging that Chinese exporters are using third countries to bypass American tariffs. The Trump administration has described the practice as a “shadow transshipment network”, claiming Chinese goods are being rerouted, relabelled or given new country-of-origin documentation before entering the US market.
The allegation is significant for India because it comes at a sensitive time for US-India trade relations. Washington has placed India among countries facing elevated transshipment risks, alongside major trading partners including Canada, Mexico, Japan and members of the European Union.
At the heart of the dispute is transshipment, where goods are moved through another country before reaching their final destination. The US claims some Chinese exporters use this process to make products appear to originate from another country and therefore avoid higher tariffs imposed on Chinese goods.
For India, the immediate concern is whether increased US scrutiny could result in tougher customs checks, additional documentation requirements or greater pressure on Indian exporters. Washington has also indicated that it plans to use artificial intelligence to identify suspicious trade patterns and strengthen enforcement against tariff evasion.
However, being listed as a country with transshipment risk does not by itself establish that India is deliberately helping China evade US tariffs. India is a major manufacturing and trading economy with legitimate supply chains involving Chinese components and raw materials. Distinguishing genuine Indian manufacturing from simple rerouting will therefore be crucial.
The issue could also affect ongoing US-India trade negotiations. American officials are increasingly demanding stronger rules of origin and anti-transshipment provisions in trade agreements.
For Indian businesses, the message is clear: supply-chain transparency and accurate documentation are becoming increasingly important. Companies exporting to the US may face greater scrutiny over where products are manufactured, where components originate and how goods move through international supply chains.
The broader development shows that Trump’s tariff strategy is expanding beyond China itself. Washington is increasingly targeting the routes and countries that it believes allow Chinese manufacturers to access the US market indirectly.
For India, the challenge will be to protect legitimate trade while ensuring that its exporters are not caught in a wider US crackdown on Chinese tariff evasion.
