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- A group of 25 influential US lawmakers has urged the US Trade Representative(USTR) not to terminate the Generalized System of Preferences(GSP) programme with India.
- They argued that terminating GSP for India would hurt American companies seeking to expand their exports to India.
- Recently,US had decided to terminate India’s designation as a beneficiary of its GSP.GSP is a preferential tariff system extended by developed countries to developing countries which allows zero tariff imports from developing countries.
- The objective of GSP is to give development support to poor countries by promoting exports from them into the developed countries.The GSP of US provides preferential duty-free entry for up to 4,800 products from 129 designated countries.According to World Bank data,India is currently the largest beneficiary of the GSP programme.
- US had taken this decision due to(a)India’s new rules on e-commerce that affected firms such as Amazon and Walmart (b)Data localisation rules which forced foreign companies to store their data locally (c)Price controls on medical devices(Cardiac stents) (d)Tariff on ICT products such as smart watches and high end mobile phones (e)Lack of greater market access for the US dairy industry and (f) Trade imbalance between India and the US
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