New York: The United States has levelled a serious allegation against 40 countries, including India.
All these countries have been accused of helping China avoid steep American tariffs by being part of a “shadow transshipment network”, PTI reported.
Peter Navarro, top trade advisor to President Donald Trump, said in a report titled ‘The Great Transshipment Scam’ that the transshipments became more prevalent after 2018, when the Trump administration imposed Section 301 tariffs on China to counter “unfair trade practices.
“For years, the great transshipment scam has let Communist China launder its exports through more than 40 countries,” Navarro, Counsellor to the President for Trade & Manufacturing, told reporters.
Interestingly, the countries accused of being China’s shadow trans-shipment network include many of the United States’ largest trading partners such as Mexico, Canada, the European Union, India, Japan and South Korea.
“China began using these third countries for minor processing, relabelling, repackaging, reinvoicing, or routing changes that created the appearance of a new national origin while leaving the underlying Chinese content largely intact,” Navarro said in the report.
By routing around the tariffs, China and its state-supported manufacturers and trading firms could push goods into jurisdictions with cheap labour, weak customs oversight, permissive free zones, or preferential US trade access, the report claimed.
Navarro, known for his anti-India rhetoric in the past, further said that the Pune-Gujarat-Chennai production belt absorbs pumps and compressors, affecting industrial supply chains in Cincinnati, Dayton and Columbus in the US.
“A Chinese pump that leaves Pune as Indian is a pump not machined in Cincinnati, Dayton or Columbus,” Navarro said.
Anti-India stance
Navarro had called India the ‘Maharaja of tariffs’ while defending US retaliatory tariffs in response to India’s purchase of Russian oil. He also claimed that India was not involved in Russian oil trade before the Ukraine war began in 2022.
A few days ago, Navarro responded to criticism in India over his comments on New Delhi and its trade policies.
“I actually got firebombed by the Indian continent on the internet with all sorts of nasty little attacks. And all I would say is, don’t do that. That’s not how we resolve problems here in America,” he told reporters at the White House.
AI to be used for identification
The annual value of illegally transshipped goods anywhere between $40 billion to $303 billion, depending on the methodology and definition used, Navarro stated.
President Trump’s advisor announced that the US will use an AI-enabled ‘Detective Border’ to identify transshipped goods reaching American shores.
It will support US Customs and Border Protection (CBP) by integrating shipment data, routing histories, product classifications, ownership relationships, production-capacity indicators, anomaly detection, computer vision, and other analytical tools.
