2 weeks ago
US Accuses India, 40+ Nations in China Tariff Evasion Network
America charges extra money, called tariffs, on products that come from China.
Some Chinese companies want to avoid paying that extra money.
They send their goods to other countries first, where the boxes get new labels.
Then the products go to America looking like they came from those other countries.
America does not like this because it loses money.
The White House wrote a report called 'The Great Transshipment Scam' about this trick.
The report says India and more than 40 other countries may be part of the network.
The report says the shipments could be worth tens or even hundreds of billions of dollars.
America wants to use smart computers, called artificial intelligence, to catch the trick.
The report does not say every country on the list is cheating on purpose.
The White House report 'The Great Transshipment Scam' accuses India and more than 40 countries of forming a 'shadow transshipment network' that helps Chinese exporters bypass US tariffs.
US trade adviser Peter Navarro says China has 'laundered' exports through third countries since 2018, when the Trump administration imposed Section 301 tariffs.
India is placed in Tier 1 'Diversified Scale Leaders' alongside Canada, the European Union, Israel, Japan, Mexico, South Korea and Taiwan.
The report estimates transshipped goods are worth $40 billion to $303 billion annually (central estimate about $75 billion), costing the US $19 billion to $26 billion in tariff revenue per year.
The US plans an AI-enabled 'Detective Border' with US Customs and Border Protection to detect false country-of-origin claims.
- Who
- The Trump administration, including US trade adviser Peter Navarro and the White House Office of Trade and Manufacturing Policy, which released the report naming India and over 40 other countries.
- What
- The US accused the countries of running a 'shadow transshipment network' that allegedly helps Chinese exporters evade US tariffs by routing goods through third countries with new country-of-origin labels.
- Where
- The allegations were published by the White House, covering trade routes through India, Canada, Mexico, the European Union, Japan, South Korea, Taiwan, Vietnam and other countries.
- When
- The articles give no exact release date; the practice is traced to 2018 Section 301 tariffs, and the report cites transaction-level customs data from 2025.
- Why
- To bypass higher US tariffs imposed on Chinese imports, allowing Chinese manufacturers to keep access to the American market while avoiding duties.
US Administration's Allegation
Report Caveats and Named Countries' Position
Role of India and Other Nations
US Administration's Allegation
India and 40+ countries are hubs in a 'shadow transshipment network' through which Chinese goods are rerouted to evade US tariffs.
Report Caveats and Named Countries' Position
The report does not allege that India's government is deliberately helping China; it says the risk is embedded within legitimate trade flows and not every shipment passing through these countries is illegal.
Legitimacy of Transshipment
US Administration's Allegation
The practice is 'smuggling disguised as trade - fraud cloaked in paperwork' that undermines US tariff policy.
Report Caveats and Named Countries' Position
Transshipment itself is not inherently illegal; goods can legitimately pass through another country during international trade.
Key facts
- Report Title
- The Great Transshipment Scam
- Countries Named
- More than 40, including India, Canada, Mexico, the EU, Japan, South Korea, Taiwan, Israel and Vietnam
- India's Tier
- Tier 1 'Diversified Scale Leaders'
- Estimated Annual Value of Transshipped Goods
- $40 billion to $303 billion; central estimate around $75 billion
- Lost US Tariff Revenue
- $19 billion to $26 billion per year; OTEA estimated about $28 billion lost in 2025
- 2025 OTEA Finding
- About $67 billion in US-bound goods transshipped from China through Mexico, India and Vietnam
- Indian Corridor Named
- Pune-Gujarat-Chennai production belt
- Planned Enforcement
- AI-enabled 'Detective Border' with US Customs and Border Protection
Quotes
Peter Navarro
U.S. trade adviser, member of the President’s Trade and Manufacturing Policy team
“Chinese exporters have for years used third countries to disguise the origin of goods and gain access to the American market while avoiding tariffs imposed on Chinese products.”
republicworld.com
“"For years, the great transshipment scam has let Communist China launder its exports through more than 40 countries,"”
NDTV
businesstoday.in
The Great Transshipment Scam report
U.S. Commerce Department analysis
“"Smuggling disguised as trade – fraud cloaked in paperwork"”
wionews.com
Sources
'Smuggling disguised as trade': US claims India part of 40-nation 'shadow network' helping China evade tariffs
US Accuses India, 40+ Nations of Helping China’s 'Shadow Trade' Network To Evade Trump Tariffs
'Shadow Network': US Names India Among 40 Hubs Of China's Tariff Evasion
US accuses 40+ nations, including India, Canada, EU of running shadow network helping China dodge Trump tariffs
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