New Delhi, July 5 -- A 12.5% tariff aimed at punishing India for forced labor practices the government disputes would normally draw an angry rebuttal from New Delhi. Instead, Commerce and Industry Minister Piyush Goyal shrugged. "They are trying to create a competitive edge for India," he told reporters this week. "I don't think we need to worry about Section 301."

an additional 12.5% duty on top of whatever tariff rate the two countries eventually settle on in their broader bilateral deal. Fifty-four other nations face similar findings. Some, with what USTR calls partial enforcement regimes, were assigned a lighter 10% rate. India was not among them.

The mechanism matters here more than the headline number. Section 301 lets the US pres...