Washington, Jun 1 (GCCurrentAffairs) United States President Donald Trump announced on Friday that he will end the preferential trade treatment for India on June 5, which exempts billions of dollars of its products from US tariffs due to its developing country status.
“I have determined that India has not assured the United States that India 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,” Trump said in a White House statement, citing the Trade Act of 1974.
In early March, the US Trade Representative’s (USTR) office announced that the United States intends to move India and Turkey out of a program under which a group of developing countries receive preferential trade treatment.
The program, called the Generalised System of Preferences (GSP), was created to support developing countries alleviating poverty through trade. India was designated as a beneficiary developing country under the program in a presidential executive order in November 1975.
As of 2017, some 5.6 billion US dollars’ worth of Indian imports enjoys duty-free status in accordance with the GSP, making the country the biggest beneficiary of the program, data from the USTR’s office showed.
In the statement, the US president also said he would remove India from the list of developing country World Trade Organization members exempt from tariffs on certain crystalline silicon photovoltaic (CSPV) products — including modules, laminates, panels, and building-integrated materials — and large residential washers.
Trump, who has complained about US trade deficit with India, issued a presidential proclamation last year removing 50 items from a list of Indian products subject to the GSP, effective from Nov 1, 2018. Washington has a 21-billion-dollar trade deficit with New Delhi in 2018, according to the US Census Bureau.