Authorities from the US Trade Chief’s office on March 4 on President Trump’s direction is planning to scrap the preferential trade status that has been granted to India and Turkey.
This news comes after US and China are trying to negotiate an exit from a costly trade war between the two countries that are part of the Trump administration’s efforts to address what it views as inequitable commercial relationships with other states.
According to a statement by the Office of the US Trade Representative, Washington “intends to terminate India’s and Turkey’s designations as beneficiary developing countries under the Generalized System of Preferences (GSP) program because they no longer comply with the statutory eligibility criteria.”
The statement also added that India has failed to provide assurances that it would allow required market access, while Turkey is “sufficiently economically developed” and that it no longer qualifies.
Under the GSP program, “certain products” can enter the US duty-free if countries meet eligibility criteria including “providing the United States with equitable and reasonable market access.”
The statement reads that India “has implemented a wide array of trade barriers that create serious negative effects on United States commerce.”
It should be noted that these changes cannot take effect for at least 60 days following the notification of Congress as well as the countries affected.
This change for India came after “intensive engagement” between New Delhi and Washington.
“I will continue to assess whether the government of India is providing equitable and reasonable access to its markets, in accordance with the GSP eligibility criteria,” the president wrote in a letter, which was released by the White House.