At a time when post Narendra Modi’s taking oath as Prime Minister of India US talked about boosting ties bweteen the two countries, President Donald Trump has striked off India from the list of beneficiaries of developing nation under a key preferential trade programme.
The move comes after allegedly determining that India has not assured the US that it will provide “equitable and reasonable access to its markets.”
Notably, the Generalised System of Preference (GSP) is the largest and oldest US trade preference programme which is designed to promote economic development by allowing duty-free entry for thousands of products from designated beneficiary countries.
In a proclamation on Friday, Trump said, “I have determined that India has not assured the US that it will provide equitable and reasonable access to its markets. Accordingly, it is appropriate to terminate India’s designation as a beneficiary developing country effective June 5, 2019”.
Earlier on March 4, POTUS had announced that the country intends to end India’s designations as a beneficiary developing country under the GSP programme and laid a 60-day notice period which ended on May 03.
As per the GSP programme, almost 2,000 products including auto components and textile materials can enter the US duty-free if the beneficiary developing countries meet the eligibility criteria established by Congress.
According to a Congressional Research Service report issued in January, India was the largest beneficiary of the programme in 2017 with $5.7 billion.