US Flags Bangladesh, India Over Chinese Transshipment
The United States has identified more than 40 countries at risk of being used as intermediaries to circumvent additional US tariffs on Chinese goods through “transshipment.” A special report by the White House Office of Trade and Manufacturing Policy (OTMP) lists Bangladesh alongside India among the countries considered vulnerable to the practice. The report alleges that exporters in several countries are re-exporting Chinese goods to the US after little or no processing, using “screwdriver assembly,” falsely declaring the country of origin, or applying new labels. The US administration has described the practice as a “Great Transshipment Scam” and warned of strict action against it.
The countries were divided into three tiers based on their economic scale and trade ties with China: Tier 1: India, Canada, the European Union, Israel, Japan, Mexico, South Korea, and Taiwan. Tier 2: Brazil, Indonesia, Malaysia, Thailand, Türkiye, and Vietnam. Tier 3: Bangladesh, Cambodia, the Philippines, Singapore, Sri Lanka, and the United Arab Emirates.
US trade adviser Peter Navarro warned that preferential or tariff-free access to the American market does not provide a “license” to launder goods from other countries. He urged countries to reduce their own trade barriers and protect intellectual property rather than evade tariffs through transshipment. the US is also planning several measures to curb the practice, including AI-based surveillance to identify high-risk shipments before they reach ports. US Customs and Border Protection (CBP) may also be empowered to impose tariffs retroactively on a company’s goods from the previous year if irregularities are detected. Washington is further seeking to include strict anti-transshipment provisions in future trade agreements, including a potential bilateral trade deal with India.
