ISLAMABAD – The United States will end preferential trade treatment forIndia from Wednesday, US President Donald Trump has announced, in a fresheconomic headwind for New Delhi alongside slowing growth and recordunemployment.
India has been the single biggest beneficiary of the decades-old USGeneralized System of Preferences programme, allowing the country to export$5.7 billion worth of duty-free goods in 2017, according to figures from USCongress.
Trump said in a statement issued late Friday that he wanted greater accessfor US goods to the giant South Asian nation.
“I have determined that India has not assured the United States that Indiawill provide equitable and reasonable access to its markets,” Trump said.
“Accordingly, it is appropriate to terminate India’s designation as abeneficiary developing country.” Trump announced in March that he would beending the preferential trade accord with India, but did not give a date.
Washington has sought to make India a closer diplomatic ally, but has longcomplained about limited access to the huge market of 1.3 billion people.
The US had a $26.7 billion trade deficit with India in 2017-2018.
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The announcement is the latest headwind to threaten the Hindu nationalistgovernment led by Prime Minister Narendra Modi, who was re-elected to hissecond term in a landslide just weeks ago after campaigning partly on hisrecord as an economic reformer.
Official figures released Friday showed that India’s growth slowed for thethird straight quarter to 5.8% in January-March, while unemployment hit a45-year high in 2018.
The Indian government made no immediate comment on Washington’s move, butmedia reports said New Delhi was considering higher import duties on morethan 20 US goods including agricultural produce and chemicals.
Indian commerce secretary Anup Wadahan played down the move to end thecountry’s GSP status in March, saying that preferential trade accounted fora fraction of its nearly $80 million in annual exports to the US. -APP/AFP
