India hit as US stops duty-free privileges

The US on Thursday revoked duty-free concessions on import of at least 50 Indian products, mostly from handloom and agriculture sectors, reflecting the Trump administration’s tough stand on trade-related issues with New Delhi.

The federal register issued a notification, listing out 90 products which were so far subject to duty-free provisions under the Generalized System of Preferences (GSP).

President Donald Trump issued a presidential proclamation on Tuesday, leading to the removal of these products from the privilege beginning November 1. As of November 1, these products “will no longer qualify for duty-free preferences under the GSP programme but may continue to be imported subject to regular Most Favored Nation duty-rates,” an official of US Trade Representative said.

A review of the products indicates that the presidential proclamation is not country specific, but product specific. With India being the largest beneficiary of the GSP, it has been hit the most by the latest decision of the Trumpadministration.

The GSP, the largest and oldest US trade preference programme, is designed to promote economic development by allowing duty-free entry for thousands of products from designated beneficiary countries

The list of products from which duty-free import provision has been removed reflects that a large number of small and medium size business could be impacted, in particular handloom and agricultural sector. Notably India is the largest beneficiary of the GSP. In 2017, India’s duty-free export to the US under the GSP was to the tune of more than $5.6 billion.

Products from other countries like Argentina, Brazil, Thailand, Suriname, Pakistan, Turkey, the Philippines, Ecuador and Indonesia have also been removed from the GSP list.

Some of the Indian products removed include dried pigeon pea seed; areca nuts,buffalo hide or skin; dyed, plain weave certified hand-loomed fabrics of cotton, hand-loomed carpet, gold mixed link necklaces and neck chains and keyboard musical instruments, like harmoniums and similar keyboard instruments