U.S. ending trade preferences for Turkey, India due to economic growth

U.S. ending trade preferences for Turkey, India due to economic growth

U.S. ending trade preferences for Turkey, India due to economic growth

The United States has finally done the inevitable, as President Donald Trump has made it clear that his administration "intends" to withdraw preferential trade status, also known as the Generalised System of Preferences or GSP, from India.

Along with India, the same could happen with Turkey as well, said reports on Tuesday.

Under the GSP program, "certain products" can enter the U.S. duty-free if countries meet eligibility criteria including "providing the United States with equitable and reasonable market access".

Mr Trump has pledged to reduce USA trade deficits, and has repeatedly called out India for high tariffs. The United States Trade Representative (USTR) in April a year ago announced that it was reviewing India's GSP eligibility on the request of the US dairy and medical devices industries, given India's alleged trade barriers affecting US exports in these sectors.

"The GSP benefits will go, the US will not relent on this", she said.

Reuters last month reported the planned USA action, which comes as the United States and China appear close to a deal to roll back us tariffs on at least $200 billion worth of Chinese goods. "The United States had initiated the review on the basis of representations by the U.S. medical devices and dairy industries, but subsequently included numerous other issues on a self-initiated basis".

Turkey is no longer eligible to participate in the Generalized System of Preferences program because it "is sufficiently economically developed", USTR said in a news release.

The letter to Congress begins a 60-day period before Trump can take action, said CNN, quoting a statement from the Office of the US Trade Representative. The Office of the US Trade Representative added, "GSP promotes sustainable development in beneficiary countries by helping these countries to increase and diversify their trade with the United States".

The two countries have also not held the India-US Trade Policy Forum - the only trade dialogue between both countries - for over a year now. This includes data localization, tariffs that India charges USA imports and new e-commerce rules.

India was ready to address USA concerns regarding medical devices in principle, by putting in place a suitable trade margin approach in a reasonable time-frame to balance concerns about fair pricing for the consumers and adequate remuneration for the suppliers. The United States services a majority of the Indian medical devices market. The new e-commerce rules are expected to have a significant impact on US retail giants Amazon and Walmart.

Trump said in a letter that India has not assured the United States that it will provide equitable and reasonable access to its markets. He, however, warned that the removal of the preferential trade status would also hurt U.S. companies, which import Indian intermediate and semi-finished goods as raw materials on the cheap.

Will India Still Benefit from U.S. When we send a motorcycle to India, they charge 100 per cent tariff.

Related news

[an error occurred while processing the directive]