No significant impact on exports, says India as US plans to scrap preferential treatmenthttps://indianexpress.com/article/business/after-trump-plans-to-scrap-preferential-trade-treatment-india-says-no-significant-impact-on-exports-5611464/

No significant impact on exports, says India as US plans to scrap preferential treatment

The GSP allows duty-free entry for thousands of products from designated beneficiary countries. Announcing the termination, Trump said India had “not assured” the US that it would “provide equitable and reasonable access” to its markets.

After Trump plans to scrap preferential trade treatment, India says no significant impact on exports
Adding that the GSP benefits were “relatively moderate,” Commerce Secretary Anup Wadhawan added that the decision will not impact India’s relations with the US.

Hours after the United States announced its intention to “terminate” New Delhi’s designation as a beneficiary of its Generalised System of Preferences (GSP), Commerce Secretary Anup Wadhawan said India does not plan to impose retaliatory tariffs on the US goods. “The withdrawal will not have a significant impact on India’s exports to the US,” he said, reported news agency PTI.

The GSP allows duty-free entry for thousands of products from designated beneficiary countries into the US. Announcing the termination, Trump said India had “not assured” the US that it would “provide equitable and reasonable access” to its markets.

Adding that the GSP benefits were “relatively moderate,” Wadhawan added that the decision will not impact India’s relations with the US. “Government of India has to be conscious of our developmental and public welfare interests. Our effort was to balance the affordable prices of the medical devices without compromising on public welfare. We have very deep routed ties with USA. All the issues in the trade domain are on the table for discussions,” he said, reported news agency ANI.

Explained | India gained from being on US trade preference list, what happens now?

Advertising

India has been the biggest beneficiary of the GSP regime and accounted for over a quarter of the goods that got duty-free access into the US in 2017. Exports to the US from India under GSP — at $5.58 billion — was over 12 per cent of India’s total goods exports of $45.2 billion to the US that year. The US goods trade deficit with India was $22.9 billion in 2017.

“At the direction of President Donald J. Trump, U.S. Trade Representative Robert Lighthizer announced today that the United States intends to terminate India’s and Turkey’s designations as beneficiary developing countries under the Generalized System of Preferences (GSP) program because they no longer comply with the statutory eligibility criteria,” stated the office of the US Trade Representative in a media release.

GSP criteria include, among others, respecting arbitral awards in favor of United States citizens or corporations, combating child labor, respecting internationally recognized worker rights, providing adequate and effective intellectual property protection, and providing the United States with equitable and reasonable market access, stated the USTR. Countries can also be graduated from the GSP program depending on factors related to economic development, it added.