The United States Customs and Border Protection (CBP) data shows that since October 2023, CBP has detained nearly $43 million worth of Indian electronic products based on the Uyghur Forced Labor Prevention Act (UFLPA), making it a new focus for U.S. trade enforcement agencies. UFLPA came into effect in June 2022.
According to a report by Reuters on Tuesday, CBP did not specify which types of electronic devices were detained. Industry sources indicate that polysilicon, a raw material for solar panels, is listed as a high-priority category under the UFLPA, with solar panels historically constituting a significant portion of detained goods.
UFLPA prohibits the importation of goods manufactured in the Xinjiang region of China, where the Chinese authorities have reportedly set up “re-education” labor camps for Uyghur and other Muslim groups, subjecting them to forced labor practices.
CBP data reveals that nearly one-third of the detained Indian electronic products were denied entry. In comparison, only 5.4% of goods from major solar component suppliers in the U.S., such as Malaysia, Vietnam, and Thailand, were refused entry during the same period.
Despite this, over the past two years, Indian products detained by CBP under UFLPA, totaling $3 billion in electronic products, represent only a small fraction of the total.
However, this presents a setback for Indian manufacturers who aspire to be an alternative option for U.S. solar developers, who have grown weary of dealing with tariffs and enforcement delays primarily targeting Chinese-made solar panels.
According to U.S. trade data, imports of solar products from India have surged in recent years, reaching $2.3 billion last year.
Data from S&P Global Market Intelligence shows that in the second quarter of 2024, India accounted for 11% of U.S. solar panel imports, more than double the previous quarter.
In 2018, the U.S. had not imported any solar panels from India.
One trade lawyer noted that the increased scrutiny on Indian goods reflects CBP’s recent efforts to expand the enforcement of UFLPA to the largest solar panel manufacturers outside of China, who have replaced Chinese polysilicon suppliers. This shift allows U.S. importers to avoid having their goods detained.
Tim Brightbill, a trade lawyer at Wiley Rein LLP, said, “If Indian solar panels contain solar cells from China, there may be an increase in detentions of Indian products. I feel that CBP may have not initially realized that many Indian solar panels contain Chinese solar cells, hence the UFLPA risk is high (and remains so).”
Richard Mojica, a trade lawyer at Washington’s Miller & Chevalier law firm, mentioned, “As Chinese manufacturers face obstacles under UFLPA, Indian module manufacturers have found an opportunity to import more products.”
The Uyghur Forced Labor Prevention Act was enacted on December 23, 2021, and went into effect on June 21, 2022. The law prohibits the importation of goods that are wholly or partially mined, produced, or manufactured in Xinjiang, or by entities listed in the law, into the United States.