India spared worst of US 'forced labour' tariffs, but hard talks loom

India has been spared the worst of Washington's latest tariff action targeting imports linked to forced labour, but analysts caution that the lower-than-expected levy does not guarantee a long-awaited US trade deal.

The Trump administration's fresh round of tariffs, unveiled last week, targeted 60 economies it accuses of failing to curb imports made with forced labour. As recently as last month, India had been threatened with a 12.5 per cent rate, but ultimately secured a place among the smaller group of economies subject to a lower levy.

Analysts say the outcome offers relief for New Delhi, but a comprehensive trade agreement between the two countries, which has been in the works for some time, still requires difficult negotiations. Talks are expected to intensify in the coming weeks.