US Trade Representative Robert Lighthizer, under direction from President Donald Trump, has announced that the US plans to end India's preferential trade status. This status will also be withdrawn from Turkey.

“The United States intends to terminate India’s and Turkey’s designations as beneficiary developing countries under the Generalised System of Preferences (GSP) program because they no longer comply with the statutory eligibility criteria,” stated a released from the Office of the United States Trade Representative.

“India’s termination from GSP follows its failure to provide the United States with assurances that it will provide equitable and reasonable access to its markets in numerous sectors,” the release added.

Under the United States GSP program, certain products from developing countries like India can be exported to the United States duty-free if that country meets the eligibility criteria established by Congress like providing adequate and effective intellectual property protection, providing the United States with equitable and reasonable market access etc.

India is the world's largest beneficiary of the GSP programme and also has a trade surplus of nearly $23 billion with the US. This imbalance in favour of India has been used by the Protectionist US President Donald Trump as an aid to attack India’s tariff policies.

India’s Policies Affecting The US

According to the US, India currently does not meet the eligibility criteria as “India has implemented a wide array of trade barriers that create serious negative effects on United States commerce. Despite intensive engagement, India has failed to take the necessary steps to meet the GSP criterion.”

“By statute, these changes may not take effect until at least 60 days after the notifications to Congress and the governments of India and Turkey, and will be enacted by a Presidential Proclamation,” the release noted.

Also Read: Covalent ‘Bonding’: India Commits To $5 Billion Worth Annual Oil Purchases From The US, $18 Billion In Defence

US Preferential Trade Treatement

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