2 weeks ago
US Names India in $67 Billion Transshipment Scam Report
The United States made a report called 'The Great Transshipment Scam.'
The report says some countries help China send its products to America in a tricky way.
To avoid paying extra taxes called tariffs, Chinese goods are given new labels or sent through other countries first.
The report says about $67 billion worth of goods took this route in 2025.
Because of this, the US lost about $28 billion in tax money.
India is one of the countries named in the report.
However, experts in India say the report has no proof of a single fake shipment.
They say the US is guessing based on trade numbers.
The report does not name any Indian company that cheated.
India is asking the US to share more detailed information.
The White House report 'The Great Transshipment Scam' says $67 billion of goods were transshipped through India, Mexico and Vietnam in 2025, causing $28 billion in tariff losses.
India was placed in Tier 1 alongside Canada, the European Union, Israel, Japan, Mexico, South Korea and Taiwan, where transshipment risk is 'embedded within broad legitimate trade flows'.
US imports from China fell from $525.8 billion in 2017 to $327.5 billion in 2025, while total US imports rose from $2.41 trillion to $3.50 trillion.
The report identifies pumps and compressors originating from Chennai, Pune and Gujarat as the products in India's case.
Trade experts at GTRI say the report does not disclose India's share, name any Indian exporter or cite a fraudulent shipment, and stretches the technical meaning of transshipment.
- Who
- The White House, which issued the report, and India, Mexico, Vietnam and about 40 other countries named in it.
- What
- A US report alleges $67 billion of Chinese goods were transshipped through India, Mexico and Vietnam in 2025, causing $28 billion in tariff losses.
- Where
- The United States and transshipment hubs including India, Mexico and Vietnam.
- When
- 2025, based on trade data for that year.
- Why
- To avoid US tariffs, Chinese goods were allegedly relabeled, repackaged, re-invoiced or lightly processed in lower-tariff countries before entering the US.
Indian trade experts and government
US administration
Evidence of transshipment
Indian trade experts and government
The report contains no country-level share for India, no named Indian exporter and no cited fraudulent shipment; it treats trade correlation as evidence and stretches 'transshipment' to cover legitimate assembly, testing and finishing.
US administration
Trade data showing falling direct imports from China and rising imports from other countries indicates Chinese goods are being relabeled, lightly processed or assembled in third countries to evade tariffs, justifying stronger enforcement.
Reason for higher non-China imports
Indian trade experts and government
Substantial Indian manufacturing capacity exists in the listed product groups, so higher imports from India reflect real production rather than evasion.
US administration
Large tariff gaps created by country-specific US tariffs make evasion profitable and finance 'screwdriver factories', repackaging operations and infrastructure that support transshipment.
Key facts
- Report name
- The Great Transshipment Scam
- Transshipped goods estimate (2025)
- $67 billion via India, Mexico and Vietnam
- Estimated lost tariff revenue
- $28 billion
- Tier 1 countries
- India, Canada, EU, Israel, Japan, Mexico, South Korea, Taiwan
- US imports from China
- $327.5 billion (2025) vs $525.8 billion (2017)
- Products flagged for India
- Pumps and compressors (Chennai-Pune-Gujarat)
- India-China trade deficit (2025-26)
- $112.16 billion
- India's FY26 exports to US
- $414.5 million in liquid pumps; $335.4 million in air pumps and gas compressors
Sources
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