Trump Terminates Designation of India as a GSP Beneficiary Nation

indica News Bureau-

US President Donald Trump, on Friday, terminated the designation of India as a beneficiary nation under its Generalized System of Preferences (GSP).

“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 proclamation.

On March 4, Trump announced that the US intends to terminate India’s designations as a beneficiary developing country under the GSP program. The 60-day notice period ended on May 3.

The largest and oldest US trade preference program, GSP is designed to promote economic development by allowing duty-free entry for thousands of products from designated beneficiary countries. Under the United States GSP program, certain products can enter the United States duty-free if beneficiary developing countries meet the eligibility criteria established by Congress.

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.  Countries can also be graduated from the GSP program depending on factors related to economic development.

The Coalition for GSP executive director Dan Anthony warned that Trump’s decision will cost American businesses over $300 million in additional tariffs every year.

“Without GSP benefits American small businesses face a new tax that will mean job losses, canceled investments and cost increases for consumers. Only a year after the Senate and House passed a three-year reauthorization of GSP by a near-unanimous margin, the Trump administration has kicked out the GSP country that saves American companies more money than any other,” he said.

Anthony said the Trump Administration made the decision in the face of opposition from members of Congress and hundreds of American businesses that have called for continued GSP eligibility for India.

“They also acted despite India’s willingness to negotiate new market access for American exports. Thus, there are no winners in today’s decision. American importers will pay more, while some American exporters will continue to face current market access barriers in India and others, including farmers, are very likely to be subject to the new retaliatory tariff, Anthony said.

The Trump Administration argues that New Delhi has failed to assure America that it will provide equitable and reasonable access to its markets in numerous sectors.


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