US President Donald Trump announced that he intends to end India`s preferential trade treatment under a program that allows USD 5.6 billion worth of Indian exports to enter the United States duty-free.
Trump, who has vowed to reduce US trade deficits, has repeatedly called out India for its high tariffs. The US goods and services trade deficit with India was USD 27.3 billion in 2017, according to the US Trade Representative`s Office.
“I am providing notice of my intent to terminate the designation of India as a beneficiary developing country under the Generalized System of Preferences (GSP) program,” Trump said in a letter to Congressional leaders.
“I am taking this step because, after the intensive engagement between the United States and the Government of India, I have determined that India has not assured the United States that it will provide equitable and reasonable access to the markets of India,” Trump said.
India is the world`s largest beneficiary of the GSP program and ending its participation would be the strongest punitive action against India since Trump took office in 2017.