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The U.S. has identified India among 40 nations involved in a 'shadow transshipment network.'
This network allegedly helps China evade Section 301 tariffs through rerouting and relabeling.
Trade advisor Peter Navarro claims Chinese goods undergo minor processing to hide their origin.
The report specifically identifies India's Pune-Gujarat-Chennai industrial belt as a hub.
More context
Chinese-made pumps and compressors are reportedly absorbed through these Indian regions.
India has been placed in 'Tier 1' of this newly identified global transshipment network.
Washington plans to deploy an AI-enabled 'Detective Border' system to track shipments.
Countries named in the report may face increased scrutiny and trade complications.
Future U.S. trade agreements will likely include strict anti-transshipment provisions.
The crackdown aims to ensure that tariffs intended for China are not bypassed via third parties.
This development comes during sensitive ongoing trade negotiations between the U.S. and India.