UCF Global Perspectives

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United States Ends Preferential Trade Deals with India

Kaitlin Miller, India Fellow

March 7, 2019

The United States government intends to scrap the preferential trade status granted to India that allows duty-free entry for up to $5.6 billion worth of its exports (Al Jazeera). Under the Generalized System of Preferences program (GSP) “certain products” can enter the U.S. duty-free if countries meet the eligibility criteria (Al Jazeera). One of the requirements is “providing the US with equitable and reasonable market access,” (Al Jazeera). A U.S. trade representative stated India has failed to provide assurances that it would allow required equitable and reasonable market access (Al Jazeera).

 

The decision reflects a failure for the two sides to agree on various trade issues (AP 2). The Indian government said it will accept the decision without further negotiations and will not impose retaliatory tariffs on U.S. goods (AP 2 & Al Jazeera). India’s Commerce Secretary, Anup Wadhawan, does not believe the decision will have a significant impact on exports or give an edge to competitors (NDTV). Despite its supposed limited impact, the GSP removal could hurt Prime Minister Narendra Modi and the ruling party ahead of the general election in May (Reuters).

 

https://www.apnews.com/901ab8119435409c923bf51eb5b0564b

https://www.apnews.com/5a8ed9b307254bad8d88ab444fab5f4a

https://www.aljazeera.com/news/2019/03/preferential-trade-status-india-turkey-190305052615053.html

https://www.reuters.com/article/us-usa-trade-india/trump-scraps-trade-privilege-for-india-delhi-plays-down-impact-idUSKCN1QM007

https://www.ndtv.com/india-news/gsp-no-big-impact-says-india-after-donald-trump-says-will-end-us-preferential-trade-status-gsp-2002868


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