India Among Countries Rerouting Chinese Goods to The US: Report
Chinese goods are allegedly relabeled, repackaged, re-invoiced or subjected to minor processing in lower-tariff countries before entering the US under a different origin
Chennai: The US has named India as one among countries which re-routed China’s exports to the US in 2025. It finds $67 billion of goods were transshipped through India, Mexico and Vietnam in 2025, causing $28 billion in tariff losses.
In White House’s report, The Great Transshipment Scam, India is placed in Tier 1 countries alongside Canada, the EU, Israel, Japan, Mexico, South Korea and Taiwan. These countries have “large absolute volumes of China-linked goods; diversified industrial bases and major US-bound export platforms where transshipment risk is embedded within broad legitimate trade flows”.
Chinese goods are allegedly relabeled, repackaged, re-invoiced or subjected to minor processing in lower-tariff countries before entering the US under a different origin.
US imports from China fell from $525.8 billion in 2017 to $327.5 billion in 2025. However, total US imports rose sharply from $2.41 trillion to $3.50 trillion.
The US therefore replaced many Chinese finished goods with imports from other countries rather than with domestic production. Trump’s tariffs changed the source of imports but failed to reduce America’s overall dependence on imported goods.
China has adapted more successfully. Instead of exporting only finished products directly to the US, it increasingly supplies components and intermediate goods to manufacturers in Mexico, Vietnam, India and several European and Asian economies. These inputs are processed, assembled or incorporated into new products before being exported to the US.
Around $67 billion of goods were transshipped through India, Mexico and Vietnam in 2025, causing $28 billion in tariff losses. However, it does not disclose India’s share, identify an Indian exporter or cite a fraudulent shipment.
According to GTRI, it stretches the technical meaning of transshipment—normally the unloading and reloading of unchanged cargo—to cover assembly, testing, finishing and component integration. It treats trade correlation as evidence. Further, country-specific US tariffs created the large tariff gaps that make evasion profitable.
