The United States has pointed a finger at 38 countries and the European Union, accusing them of participating in a “shadow transshipment network” that facilitates Chinese goods, which are heavily taxed, into the U.S. market by way of intermediary nations. A comprehensive report, “The Great Transshipment Scam,” estimates these potentially unlawful transshipments could be valued at approximately $60 billion, significantly impacting U.S. tariff income.
The list of implicated nations and territories is extensive, featuring India, Canada, Japan, Mexico, South Korea, Taiwan, Brazil, and the European Union, among others. It also includes Israel, Indonesia, Malaysia, Thailand, Turkey, Vietnam, Argentina, and several more across various continents. The report suggests that around $67 billion worth of goods destined for the United States were allegedly rerouted from China through major transit points such as Mexico, India, and Vietnam in 2025, leading to an estimated $28 billion loss in U.S. tariff revenue.
Highlighting specific routes, the report draws attention to the Pune-Gujarat-Chennai corridor in India, where it claims Chinese exports like electric pumps and compressors have been redirected. This alleged activity not only benefits businesses situated along this corridor but also heightens competition for American manufacturers, who face increased pressure due to these redirected goods.
In response to these allegations, the U.S. is contemplating a series of actions aimed at curbing this practice. Proposed measures include enforcing stricter inspections and interdictions, applying additional tariffs, imposing sanctions, and possibly limiting market access for nations that are found to be facilitating the evasion of tariffs.