India will submit its defence early this week in the two US Trade Representative (USTR) Section 301 investigations, which New Delhi believes are “factually baseless”, sources said. 

The government is set to argue that no Indian policies in the targeted areas were designed to, or did, harm US commercial interests in its bid to come clean in the investigation and avoid additional tariffs and other penalties.

“The government and some impacted sectors, which may include automobiles, steel and machineries, are finalising submissions ahead of the USTR’s April 15 deadline”, a source tracking the matter told businessline.

On March 11, 2026, the USTR launched a probe into structural excess capacity especially targeting manufacturing sectors where India and other countries covered in the probe maintain a trade surplus.

These include specifically steel, automotive products, apparel/footwear, electrical equipment and pharmaceuticals. The US alleged these policies displace US domestic production.

This was followed by a second Section 301 investigation (the next day) into 60 economies, including India, regarding their failure to effectively prohibit forced-labor imports, a practice Washington claims burdens American commerce through artificially low-priced competition.

“India’s defense is likely to focus on the legal requirements of specificity and determination under Section 301, with New Delhi likely to argue that the USTR has not mentioned specific policies or procedural inactions that demonstrably harm US commercial interests. In the investigation on excess capacity, merely having a trade surplus is not evidence of irreparable injury,” the source said.

While concerns on use of forced-labour imports is a genuine one, but the probe against India is misguided and without any factual basis, the source added.

“The USTR will make an assessment going through all the arguments and counterarguments submitted by all stakeholders on the investigations. Based on all the evidence it will be very difficult for them to justify the cases against India. But we are not really sure about how this administration will proceed on the two cases,” the source said.

The use of Section 301 as an executive tool is evidently a strategic response to recent legal setbacks on use of reciprocal tariffs that the US SC invalidated. “The Donald Trump regime is seeking to broaden the application of both Section 232 and Section 301 under which it can take independent action. This could be intended to create new trade pressures and regain leverage, in the negotiations for the India-US bilateral trade agreement,”the source said.

The public hearings are scheduled to take place on April 28-May 1 for the forced labor investigation and on May 5-8 for the industrial excess capacity investigation.

Published on April 12, 2026