India Shrimp Tariff Act

Bill Number

S. 2868

Origin Chamber

Senate

Congress

119th Congress, Session 1

Policy Area

Foreign Trade and International Finance

Status

Introduced

Latest Action

2025-09-18: Read twice and referred to the Committee on Finance.

Last Updated

2026-02-04T05:06:25Z

AI-Generated Summary

Summary of S. 2868: India Shrimp Tariff Act

Purpose

The legislation aims to protect U.S. shrimp producers by increasing tariffs on shrimp imports from India, addressing concerns about unfair competition from subsidized and protected Indian exports. It seeks to promote sustainable U.S. shrimp harvesting, enhance worker and environmental protections, and support U.S. trade preference programs by phasing in higher duties and improving import oversight.

Key Provisions

• Short Title and Definitions: The bill is titled the "India Shrimp Tariff Act." It defines key terms like GATT 1947 and 1994 (General Agreement on Tariffs and Trade, international trade agreements), HTS (Harmonized Tariff Schedule of the United States, a list of import duties), and others related to trade reports and organizations.

• Sense of Congress: Congress finds that U.S. shrimp producers face disadvantages due to India's high tariffs (up to 300% on agriculture, 30% base on shrimp plus a 10% surcharge), subsidies, weak worker/environmental standards, and disease issues in Indian aquaculture. U.S. wild-caught and farmed shrimp make up less than 10% of domestic consumption, and imports from India evade some duties due to WTO rulings. The sense is that gradually increasing duties on Indian shrimp is needed to protect U.S. and partner-country sustainability and trade goals.

• Phase-In of Duty Increases for Indian Shrimp: For specific HTS subheadings covering fresh, frozen, preserved, or prepared shrimp (e.g., 0306.16.00, 0306.17.00, 1605.21):
• Starting January 1, 2026: 10% general rate (Column 1) and 25 cents per kilogram (Column 2, for non-preferred nations).
• Starting January 1, 2027: 20% general rate and 50 cents per kilogram.
• Starting January 1, 2028 and ongoing: 40% general rate and $1 per kilogram.
• Customs valuation for Indian shrimp must use at least the average U.S. ex-vessel price (price paid to U.S. fishers at the dock) as of export date, overriding standard valuation rules.

• Country of Origin Labeling: Amends the Agricultural Marketing Act of 1946 to require labeling for whole cooked shrimp and crawfish (and sections thereof) as not "processed food items," ensuring clear origin disclosure. The Secretary of Agriculture must update regulations accordingly.

• Additional Duty on Shrimp Imports: Imposes a $0.10 per kilogram duty on all shrimp imports under the specified HTS subheadings. Revenue must fund inspections of imported shrimp and catfish by relevant agencies.

• Treatment of Duties: All new duties are added on top of existing tariffs, trade remedies (like antidumping duties), or other laws.

• WTO Schedule Modification: The U.S. Trade Representative (USTR) must adjust the U.S. Schedule of Concessions under GATT 1994 to reflect these changes, complying with WTO rules on most-favored-nation treatment (equal treatment for all WTO members unless exceptions apply).

Significant Changes to Existing Law

• Tariff Structure: Currently, most warm-water shrimp enters duty-free (0%) under HTS Columns 1 and 2, or at 5% for some preserved types (often waived via trade agreements). This bill introduces targeted, escalating duties specifically for India, diverging from the uniform "free" rate.

• Valuation Method: Alters the standard under the Tariff Act of 1930 by mandating a minimum value based on U.S. prices, potentially increasing assessed duties on undervalued Indian imports.

• Labeling Expansion: Broadens exemptions from "processed food" status in country-of-origin rules, requiring labels for cooked shrimp and crawfish that were previously exempt, improving consumer transparency.

• New Funding Mechanism: Creates a dedicated duty to finance broader import inspections, not previously tied to shrimp revenue.

Potential Impacts

• On Government Agencies: U.S. Customs and Border Protection (CBP) will collect higher duties and enforce new valuations; the Food and Drug Administration (FDA) and U.S. Department of Agriculture (USDA) gain funding for more inspections (currently only 0.1% of shipments checked), potentially reducing unsafe imports. USTR must handle WTO adjustments, risking disputes.

• On Citizens: U.S. shrimp fishers and farmers may see market relief and job protection from reduced cheap imports, but consumers could face higher shrimp prices (India supplies a large share). Enhanced inspections may improve food safety.

• On International Relations: Could strain U.S.-India trade ties, as India views its practices as standard; WTO modifications aim for compliance but may invite challenges from India or others, affecting global trade norms.

Main Stakeholders Affected

• U.S. Shrimp Industry: Domestic producers, fishers, and processors benefit from protection against Indian competition.
• Indian Exporters: Face higher costs and barriers, potentially reducing U.S. market access for their aquaculture shrimp.
• U.S. Consumers and Importers: Retailers and buyers may pass on increased costs; better labeling aids informed choices.
• Government Entities: CBP, FDA, USDA (for inspections and enforcement), and USTR (for trade negotiations).
• Trade Partners: Countries with free trade agreements (e.g., those waiving duties) indirectly gain if U.S. preferences are strengthened.

Notable Legal, Constitutional, or Political Implications

• Legal: Aligns with U.S. trade remedy laws but targets one country, requiring WTO-compliant modifications to avoid violations of most-favored-nation principles (Article I of GATT). May face challenges if seen as discriminatory.

• Constitutional: Exercises Congress's Article I power to regulate commerce and impose tariffs, potentially shifting from executive-led trade actions.

• Political: Reflects protectionist trends in U.S. agriculture, emphasizing fair trade over free trade; could influence bilateral talks with India or WTO reforms, highlighting tensions between domestic industry support and global obligations. No direct constitutional conflicts noted, but implementation relies on executive agencies.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Sen. Cassidy, Bill [R-LA]

Cosponsors (1)

Sen. Hyde-Smith, Cindy [R-MS]

Recent Actions

• 2025-09-18: Read twice and referred to the Committee on Finance.
• 2025-09-18: Introduced in Senate

Bill Versions

• India Shrimp Tariff Act — issued 2025-09-18 — PDF (10 pages)