Washington: The US President has decided to target the duty-free import of Indian goods, worth $ 5.6 billion. The Generalised System of Preference (GSP) status, awarded to India, which kept these imports duty-free, will be revoked from June 5. However, India termed the decision to be unfortunate. The US President said that this decision was taken because India has not provided the US with the equitable and reasonable access to its markets.
It seems that President Trump has taken all the trade partners of the United States to the task. Trump said, “These countries have exploited the United States in the trade so far. The previous administrations ignored it. But this will not be tolerated, henceforth.” President Trump has openly initiated a trade war against China. Trump has been warning the members of the European Union that they should not take the United States for granted. The trade disputes of the United States, with partner countries like Japan and South Korea, are not yet resolved. In this scenario, President Trump withdrew the GSP facilities given to India, from June 5.
President Trump justified the decision saying that India is not opening up its markets for the US companies to the necessary extent. Trump blamed that India has failed to assure the United States in this matter. Before this, on March 4, Trump had hinted about such a decision. India has reacted terming it to be an unfortunate decision. The decision has threatened duty-free export of Indian goods, worth $5.6 billion to the United States. This has posed a fresh challenge in front of the new Indian government.
Despite all this, indications are that a solution can soon be found, in the matter. On the one hand, the United States is working on making the ties more comprehensive at all the levels. The US and Indian leadership had expressed a resolve to take the annual bilateral trade to $ 500 billion. The current bilateral trade between the two countries is $ 142 billion. The Indian exports to the United States are worth $ 83.2 billion, and the US exports to India are worth $ 58.9 billion. The United States suffers a loss of nearly $ 24 billion on this account.
The US leaders and senior officials are consistently highlighting the military importance of India before the national leadership. In such a scenario, the indications are that the GSP decision, relating to India, may soon be withdrawn. Importantly, President Trump avoided levelling allegations against India, in his usual blunt style, while announcing the decision. Therefore, the issue seems to be resolvable through negotiations.
Already in a trade war with China, the United States cannot afford another trade dispute, with India. But it is clear that despite this, President Trump has delivered a message to India that it cannot take the United States for granted. The US industry had complained even in the past that India was not opening its markets, to the requisite level, for the UN industry. India too has been complaining about the blows suffered by the Indian IT sector due to the recent decisions, taken by the Trump administration.