The Trump administration is investigating the role of India and nearly 40 other countries in an alleged Chinese scheme to bypass US tariffs by rerouting goods through third countries, according to an investigation cited by the White House.
US trade adviser Peter Navarro said artificial intelligence helped identify trade patterns suggesting that Chinese goods are being sent to countries including India, Mexico, Canada, Israel, South Korea, Japan and members of the European Union for processing or repackaging before being exported to the American market. The administration has dubbed the alleged practice the “Great Transshipment Scam.”
Washington claims the arrangement allows Chinese products to enter the US without clearly identifying their Chinese origin, potentially helping exporters avoid tariffs imposed on Chinese goods. The measures were originally introduced under Section 301 of US trade law in 2018 to address concerns over the US-China trade imbalance and protect American industries.
According to figures cited by the Trump administration, the estimated value of Chinese goods entering the US through third countries could range from $40 billion to $303 billion. US trade data reportedly shows that China exported goods worth around $67 billion to India, Mexico and Vietnam in 2025.
The investigation comes amid broader trade tensions between Washington and Beijing. The US is also considering tougher measures against countries purchasing Russian oil and other commodities. India-US trade negotiations remain ongoing, adding another layer of complexity to the latest allegations.
