Trump Administration Plans to End India’s Preferential Trade Status.
President Trump notified the Congress his intent to terminate trade benefits for both India and Turkey under the Generalized System of Preference (GSP) eligibility criteria.
Why the US is planning to withdraw GSP for India?
India was the largest beneficiary of the GSP program in 2017 with $5.7 billion in imports to the US given duty-free status. Basically, it’s a two-way understanding that the preference given to India against import Oil&Gas and defense system from the US. India has offered a trade package to the US which promises of about Rs 35,000 crore annually import in oil and gas and another Rs 1, 00,000 lakh crore in defense orders in the coming years. India and GSP about 2,000 products, including auto components and textiles, can enter the US duty-free if the beneficiary developing country meets the eligibility criteria
President Trump has accused India of failing to ensure the US of “equitable and reasonable” access to its markets. The US is pressing India to reduce US trade deficits and has repeatedly called out India for high tariffs.
Withdrawal of GSP is part of the President Trumps plan to redress what it considers to be unfair trading relationships.
By this way, the US can financially hit Iran as well, as India import Oil & gas from Iran too.