Washington, Jun 20 (IANS): A US report accusing India of being a source, destination, and transit country for forced labour and sex trafficking, has asked New Delhi to develop a comprehensive anti-trafficking law.

The annual Trafficking in Persons Report released by Secretary of State Hillary Clinton Tuesday places India for the second year among Tier 2 countries whose governments do not fully comply with minimum standards but are making significant efforts to bring themselves into compliance.

The forced labour of millions of India's citizens constitutes India's largest trafficking problem, the report said noting men, women, and children in debt bondage are forced to work in industries such as brick kilns, rice mills, agriculture, and embroidery factories.

A common characteristic of bonded labour is the use of physical and sexual violence as coercive tools, it said.

Ninety percent of trafficking in India is internal, and those from India's most disadvantaged social strata, including the lowest castes, are most vulnerable, the report said.

Some Indians who migrate willingly every year for work as domestic servants and low-skilled labourers find themselves in forced labour in the Middle East and, to a lesser extent, Southeast Asia, the United States, Europe, Southern Africa, the Caribbean, and other countries, it said.

The report noted that In March 2012, a US court entered a default judgment of $1.5 million in favour of an Indian domestic worker who sued a former Indian consular officer who had employed her while assigned to duty in the United States

No appeal was filed in the case, the report said. The domestic worker had accused the Indian diplomat of forcing her to work without adequate compensation for three years and subjecting her to physical and mental abuse.

Noting that the India was making significant efforts to fully comply with the minimum tandards for the elimination of trafficking, the report recommended that India develop a comprehensive anti-trafficking law or amend anti-trafficking legislation to be in line with the 2000 UN TIP Protocol.

It also asked India to increase prosecutions and convictions on all forms of trafficking, including bonded labour and encourage states to establish special anti-trafficking courts.