India Prohibits Import of Goods Made with Forced Labour in New Trade Policy

New Delhi, India Jul 15, 2026 ALN: The Indian government has amended the Foreign Trade Policy (FTP), 2023, to prohibit the import of goods produced or manufactured using forced labour. This significant change aims to strengthen the trade policy framework and align domestic regulations with internationally recognized labour standards.

The latest move comes amid a US investigation into forced labour practices across 60 nations, including India. The Directorate General of Foreign Trade (DGFT) has issued a notification inserting a new provision—Paragraph 2.20B—into the FTP.

According to the new provision, “The import of goods produced or manufactured, wholly or in part, through the use of forced labour is prohibited.” This empowers the Centre to ban the import of goods found to have been produced, either wholly or partly, through forced labour. Notably, the amendments are set to come into force 30 days after their publication in the Official Gazette.

Under the revised policy, imports of goods manufactured using forced labour will be banned, while the Centre will have the authority to notify specific products for import restrictions based on findings from inquiries or any other relevant material.

The latest notification also introduces an inquiry mechanism wherein the DGFT will examine whether imported goods have been produced using forced labour. Additionally, the DGFT has adopted a formal definition of “forced labour” under Chapter 11 of the FTP, aligning with the definition contained in the International Labour Organization’s Forced Labour Convention, 1930 (No. 29).

According to the official notification, forced labour refers to “all work or service which is exacted from any person under the menace of any penalty and for which the said person has not offered himself voluntarily.” This definition underscores the seriousness of the issue and the government's commitment to uphold human rights in trade practices.

The amendment is a crucial step in India's efforts to ensure ethical practices in trade and to combat the global issue of forced labour. By prohibiting the import of goods made under such conditions, India is taking a stand against human rights violations and promoting fair trade practices.

As the global economy increasingly emphasizes ethical sourcing and sustainability, this policy change positions India as a responsible player in international trade. It reflects a growing awareness and commitment to uphold human rights standards in the production and trade of goods.

The implications of this policy amendment are far-reaching. For one, it places India in alignment with other countries that are increasingly scrutinizing supply chains for human rights abuses. The United States, for instance, has been particularly aggressive in its enforcement of laws against imports made with forced labour, prompting many countries to reevaluate their own policies. This new measure is likely to enhance India's standing in international trade negotiations, as countries and corporations seek partners who adhere to ethical labor standards.

Moreover, the policy change can have a significant impact on Indian manufacturers and exporters. Companies that rely on imported raw materials or components may need to conduct more rigorous due diligence to ensure that their supply chains are free from forced labour. This could lead to increased operational costs, as businesses may have to invest in compliance mechanisms and audits to verify the ethical sourcing of their products. However, in the long run, such investments could pay off by building consumer trust and loyalty, particularly among ethically conscious consumers.

The introduction of an inquiry mechanism by the DGFT is also noteworthy. This mechanism will allow for the investigation of specific cases where forced labour is suspected. Such inquiries could lead to greater transparency in supply chains and may deter companies from engaging in unethical practices. However, it also raises questions about the capacity of the DGFT to effectively implement and enforce these new regulations, given the vast number of imports that flow into India on a daily basis.

Critics of the amendment may argue that while the intentions behind the policy are commendable, the execution could be fraught with challenges. There are concerns about the potential for increased bureaucratic red tape, which could disproportionately affect smaller businesses that may lack the resources to navigate the complexities of compliance. Additionally, there is the risk of unintended consequences, such as the possibility that legitimate goods could be caught up in enforcement actions due to insufficient evidence or misunderstandings regarding their production practices.

Furthermore, the definition of forced labour adopted by the DGFT aligns with international standards, but its application will require careful consideration. The complexities surrounding what constitutes forced labour can vary significantly across different industries and regions. For example, practices that may be considered exploitative in one context might not be viewed the same way in another. Therefore, the DGFT will need to ensure that its inquiries and enforcement actions are based on clear, consistent criteria to avoid ambiguity and potential backlash from trading partners.

On a broader scale, India’s move to prohibit imports of goods made with forced labour reflects a growing global trend towards prioritizing ethical business practices. Many countries are now recognizing that addressing human rights issues in trade is not just a moral imperative but also a critical component of sustainable economic development. As consumers become more aware of the conditions under which products are made, there is an increasing demand for transparency and accountability in supply chains.

This shift in consumer sentiment is being echoed by major corporations, many of which are adopting corporate social responsibility (CSR) initiatives aimed at ensuring ethical sourcing. Companies that fail to address these concerns may find themselves at a competitive disadvantage in the marketplace. Thus, India’s new policy could serve as a catalyst for companies within the country to adopt more robust ethical practices, ultimately benefiting both workers and consumers.

In conclusion, the Indian government's amendment to the Foreign Trade Policy marks a significant milestone in the fight against forced labour. It not only aligns with international standards but also reinforces India's commitment to ethical trade practices. As the world moves towards a more conscientious approach to trade, India's proactive stance could set a precedent for other nations, encouraging a collective effort to eradicate forced labour from global supply chains. The success of this policy will ultimately depend on effective implementation, robust enforcement mechanisms, and a collaborative effort among stakeholders to uphold human rights in trade practices.