India delays levying retaliatory tariff on U.S. goods to June 16

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  1. Indian government has decided to extend the deadline to impose retaliatory import tariffs on 29 US products till June 16,2019.
  2. These deadlines were extended several times since June 2018 when India decided to impose these duties in retaliation to a move by the US to impose high customs duties on certain steel and aluminium products.
  3. Further,this extension comes in the backdrop of the US decision to withdraw export incentives being provided to Indian exporters under Generalised System of Preferences(GSP) programme.
  4. However,India may go ahead with its decision to impose retaliatory tariffs if the US withdraws the GSP benefits.GSP is a preferential tariff system extended by developed countries to developing countries which allows zero tariff imports from developing countries.
  5. The US wants India to (a)address the price cap issue for medical devices (b)provide greater market access for dairy and agricultural products and (c)reduce high import tariffs for mobile phones.
  6. In 2018, bilateral trade in goods and services registered a growth of 12.6% to $142 billion from $126 billion in 2017.

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