Trump says forced labour tariffs will boost US investment, not hurt economy

Washington,UPDATED: Jul 28, 2026 21:22 IST

US President Donald Trump has said the new tariffs imposed by the US on goods linked to forced labour will not hurt the economy, and claimed they would instead bring in hundreds of billions of dollars in investment. In an interview with Fox News, Trump said the new tariffs were another way of achieving the same result after the Supreme Court struck down earlier levies imposed under the Emergency Economic Powers Act.

Trump also said the threat of tariffs had helped stop five of eight wars, including the India-Pakistan conflict last year. He further claimed the tariffs had benefited major industries in the US, including automobiles and semiconductors, and had pushed companies to shift investment to the country.

Responding to a question on whether the tariffs imposed a few days ago would hurt the economy, Trump said, "No, because it's bringing hundreds of billions of dollars." He added, "No, no, the tariffs have, I mean, it's a shame that I have to go a harder way for the tariffs because the Supreme Court in a very close decision, you know, ruled against me."

He said the new forced labour tariffs were the "other way of doing the same thing" after the court ruling. "Now, I have other ways of doing the same thing, but it's a more cumbersome, you know, way of doing it. But the tariffs have made this country a fortune. It made the country rich," the US President said.

Last week, the US Trade Representative imposed tariffs ranging from 10 per cent to 12.5 per cent under Section 301 of the Trade Act of 1974 on 60 countries. The US said these countries had failed "to impose and effectively enforce a prohibition on the importation of goods produced with forced labour".

In the same interview, Trump said the threat of tariffs had stopped five of the eight wars, including the India-Pakistan conflict last year. "The threat of tariffs stopped India and Pakistan from going into a nuclear war," Trump said, referring to Operation Sindoor.

India launched Operation Sindoor on May 7 last year, targeting terror infrastructure in Pakistan and Pakistan-occupied Kashmir in retaliation for the Pahalgam terror attack that killed 26 civilians in April 2025. The strikes triggered four days of intense clashes between the two countries.

India has been consistently maintaining that the understanding on cessation of hostilities with Pakistan was reached following direct talks between the Directors General of Military Operations of the two militaries.

Trump also referred to his visit to the General Motors plant in Michigan on Monday. "They have the best gear. They have the most trucks, the most cars. The tariffs have saved General Motors. What I've done to the auto business, what I've done to the chip business, we have chip companies now building hundreds of billions of dollars worth of chip plants," he said.

He added, "These tariffs, it's the greatest thing. And only the really smart people or the people that are non-political and that get it talk about it." Trump also said, "Toyota just left Mexico. They're building, they just announced, they're building USD 12 billion worth of plants in the United States, all because they want to avoid tariffs. They have no tariffs if they build their product here."

Trump's remarks linked the new forced labour tariffs to investment, legal changes in how the levies are imposed, and his broader claim that tariff threats have influenced both trade decisions and international conflicts.

With PTI Inputs

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