The United States has raised concerns about a network involving 38 countries and the European Union, which it claims is enabling Chinese goods to sidestep hefty US tariffs by entering the country through intermediary nations. A detailed report, titled “The Great Transshipment Scam,” suggests that this potentially unlawful practice could involve a staggering $60 billion. The report suggests that this scheme has significantly impacted US tariff revenue collections.
The list of implicated countries and territories includes a diverse array of nations such as India, Canada, Israel, Japan, Mexico, South Korea, Taiwan, Brazil, Indonesia, Malaysia, Thailand, Turkey, Vietnam, and several others, including the European Union. Allegations point to these countries as part of a sophisticated transshipment network that facilitates the rerouting of Chinese goods to avoid direct US tariffs.
In 2025, around $67 billion worth of goods destined for the US were reportedly rerouted from China through major transshipment hubs like Mexico, India, and Vietnam. This diversion is believed to have resulted in approximately $28 billion in lost tariff revenue for the US. The report specifically mentions the Pune-Gujarat-Chennai corridor in India, highlighting how Chinese exports such as electric pumps and compressors have not only benefited local businesses along this route but also heightened competition pressure on American manufacturers.
As a response to these findings, the US is contemplating a series of stringent measures. These could include more rigorous inspections and interdiction efforts, the imposition of additional tariffs, sanctions, and possibly limiting market access for countries found to be aiding in tariff evasion activities. The US aims to curb the economic impact and protect its domestic industries from what it perceives as unfair trade practices facilitated by transshipment.