India may soon regain duty-free access to US as Trump admin mulls restoring GSP status; trade talks underway : 19-06-2020

Indian exporters may soon again export select goods to the US markets without a levy of import duty in the country as Donald Trump administration is likely to restore India’s trade preference under the Generalized System of Preference (GSP). A high retaliatory tariff on imports from the US is among the major reasons forcing the US to make this move. The US is mulling over restoring India’s beneficiary status on receiving a counterbalancing proposal from New Delhi, PTI reported citing a top Trump administration official. In the month of June 2019, the Donald Trump government terminated India’s designation as a beneficiary developing nation under the GSP trade programme, blaming India for not providing equitable and reasonable access to its markets.

The GSP is the US trade preference programme, which is designed to promote economic development by allowing duty-free entry for products from designated beneficiary countries. After India’s ambassador, Taranjit Singh Sandhu informed that India’s supply of antimalarial drug hydroxychloroquine (HCQ) to the US has given the two countries enough confidence and they could strike a smaller trade deal in the coming weeks, US trade representative Robert Lighthizer told members of the Senate Finance Committee that America is currently negotiating the GSP with India.

Washington State Senator Maria Cantwell expressed disappointment over high import tariffs on apples from her state to India and underlined that India has a 70 per cent tariff on apples. Montana Senator Steve Daines also said that he is concerned over high import tariffs on pulses by India, which is the largest consumer of pulses and an important market for Montana farmers. Lighthizer added that India’s regular tariffs are bad and the country’s retaliatory tariffs are even worse, according to PTI.

Lighthizer further added that negotiations with India are taking longer than expected as India is reluctant to keep high tariffs while the US is waiting for a fair deal. Meanwhile, during the Namaste Trump event organised in February this year, US President Donald Trump had mentioned that he and Prime Minister Narendra Modi were set to seal one of the biggest trade deals. He had also highlighted that Prime Minister Narendra Modi is a tough negotiator and they were in the early stages of discussions.

Source : Financial Express