U.S. ALLEGATIONS OF ILLEGAL TRANSSHIPMENT THROUGH INDIA

U.S. ALLEGATIONS OF ILLEGAL TRANSSHIPMENT THROUGH INDIA — TRADE CONTROVERSY, EVIDENCE AND IMPLICATIONS

1. Background

• In August 2026, the White House released a report titled “The Great Transshipment Scam”, alleging that Chinese exporters increasingly route goods through third countries to avoid higher U.S. tariffs.
• The report identifies more than 40 countries and jurisdictions as having elevated transshipment risk, including India, Mexico, Canada, the European Union, Japan, South Korea and several Southeast Asian economies.
• These are allegations of risk and possible tariff evasion, not a finding that all trade routed through these countries is illegal.

2. What Is Illegal Transshipment?

• Illegal transshipment occurs when goods originating in a high-tariff country are routed through another country and falsely presented as originating there.
• The White House report says such practices may involve minor assembly, relabelling, repackaging, re-invoicing or documentation changes without sufficient economic transformation of the product.
• The central legal issue is whether genuine substantial transformation has occurred or whether the third country is merely being used to disguise origin.

3. Why India Has Been Named