Nginx throws - 403 Forbidden

Question

I am using nginx docker image to host a static site behind basic authentication on ECS. The site contains landing page, along with a list of directories having index.html and linked in main landing page.

With current configuration I am able to access index.html in other directories but not main landing page at location - /. When I try to access it at location /, nginx throws - 403 forbidden.

Following is my Dockerfile and nginx.conf file :-

Dockerfile

FROM nginx:1.21.4

RUN useradd new-user

RUN chown new-user:new-user /usr/share/nginx/html/

RUN rm -v /etc/nginx/conf.d/default.conf

ADD nginx/ /etc/nginx/conf.d/ # => nginx folder contains nginx.conf and nginx.htpasswd file

COPY index.html /usr/share/nginx/html/

RUN mkdir /usr/share/nginx/html/static

COPY static/ /usr/share/nginx/html/static/

EXPOSE 80

VOLUME ["/usr/share/nginx/html/"]

CMD ["nginx", "-g", "daemon off;"]

nginx.conf

server {
    listen       80;
    server_name  localhost;

    location / {
        root   /usr/share/nginx/html;
        index  index.html index.htm;

        # basic user authentication
        auth_basic "basic-auth";
        auth_basic_user_file /etc/nginx/conf.d/nginx.htpasswd;
    }

    location /lb-status {
        access_log off;
        return 200;
    }

    location /static {
        access_log off;
        alias /usr/share/nginx/html/static;
    }

    error_page   500 502 503 504  /50x.html;
    location = /50x.html {
        root   /usr/share/nginx/html;
    }
}

I have cross checked my configuration from official docs and few answers on StackOverflow. I am unable to find the issue with current config. Would appreciate any hint.

Thanks