The United States has moved to impose an additional 12.5-percent tariff on Indian imports, escalating tensions even as both countries continue negotiations on a broader trade agreement in New Delhi.

The proposal, issued by the Office of the U.S. Trade Representative, is linked to concerns over imports allegedly connected to forced labour and places India among several economies flagged under ongoing Section 301 trade proceedings.

Washington said India has not effectively enforced measures against such imports, arguing that this creates unfair competition for American industries, while New Delhi said the proposed tariff is not final and remains subject to review and public consultation.

The development comes amid active bilateral talks and is expected to complicate efforts to finalize a framework trade deal, with both sides continuing discussions on potential tariff relief and enforcement issues.