What happened
The Office of the United States Trade Representative (USTR) proposed additional tariffs on imports from 60 economies including Pakistan, after determining that they had failed to impose or effectively enforce a prohibition on importing goods made with forced labour.
In a statement issued on 2 June 2026 and reported the following day, the USTR said the findings followed investigations under Section 301 of the Trade Act of 1974. It proposed additional duties of 10 per cent for economies that already have a forced-labour import prohibition, have committed to one through a trade agreement, or operate a partial regime, and 12.5 per cent for all others.
Pakistan was named among six economies — with Canada, Ecuador, the European Union, Indonesia and Mexico — found to have failed to effectively enforce an existing prohibition, placing it in the 10 per cent tier. Other economies proposed for 10 per cent duties included Argentina, Bangladesh, Cambodia, El Salvador, Guatemala, Malaysia, Taiwan and Britain. The remaining 45 investigated economies, among them China, India, Vietnam, Japan and South Korea, were proposed for 12.5 per cent.
Why it matters
The proposal matters for Pakistan because the United States is a major export market, and the duties, if finalised, would add to the cost of Pakistani goods entering it. Sixteen Pakistani entrepreneurs and business leaders attended the SelectUSA Investment Summit in Maryland in May, which Washington said could deepen US-Pakistan economic ties. The USTR said the failure to enforce forced-labour import bans undermines efforts to keep forced labour out of global supply chains and disadvantages American workers. The US Trade Representative, Jamieson Greer, said the failure of key trading partners to address the importation of goods made with forced labour was “unacceptable”.
The measures are not final. The USTR opened a public comment period, with written comments due by 6 July and public hearings due to begin on 7 July before a final determination. The announcement came ahead of the 24 July expiration of a temporary 10 per cent tariff imposed by the Trump administration on 20 February 2026, after the US Supreme Court struck down earlier tariffs issued under the International Emergency Economic Powers Act.
Several trading partners rejected the findings, Dawn reported. China said it opposed all forms of unilateral tariffs and denied the forced-labour allegations, the European Commission called the proposed tariffs unjustified, and Switzerland rejected the US findings on how economies handle goods produced by forced labour. The proposed action follows earlier Pakistan-US trade engagement, which KhabarWire reported here.
