New Delhi: Despite a major push from the Indian side, New Delhi was unable to get the American trade benefits, officially known as the US Generalized System of Preferences program, or GSP, restored for its exporters that were taken away by the former Donald Trump administration of the US.
This was the second time that Commerce and Industry Piyush Goyal raised the matter with his American counterpart US Trade Representative Katherine Tai under the US-India Trade Policy Forum, the annual trade dialogue between both countries, which Trump had discontinued.
“India highlighted its interest in restoration of its beneficiary status under the U.S. Generalized System of Preferences program. The United States noted that this could be considered, as warranted, in relation to the eligibility criteria determined by the U.S. Congress,” said a joint statement issued by the Office of the USTR.
Goyal is in the US for the TPF, which met Thursday, after more than a year. The TPF was to meet in November 2022 but got postponed due to the US midterm elections. It last met in November 2021 after a gap of four years, after the Joe Biden administration came to power.
India was removed from the GSP list in June 2019 even as it was keen on having a free trade agreement between both countries. However, the trade pact could never fructify and subsequently Washington made it clear to New Delhi that it is not looking to sign a trade pact.
Under the GSP scheme, India used to draw benefits worth around $6 billion from the US by means of zero or reduced tariffs on 2,167 products. This was given on the $46 billion worth of goods India exports to the US. The preferential treatment was given to labour-intensive sectors like leather, jewellery and engineering exports.
Trade Disputes Pending At WTO To Be Solved Bilaterally
One of the major decisions taken by both sides during the latest TPF, which is the highest decision-making body between India and the US on bilateral trade and investment issues, was that both sides will resolve all trade disputes bilaterally.
“The Ministers welcomed the recent intensification of work among their officials aimed at finding mutually agreed solutions on outstanding WTO disputes between the two countries. They further directed officials to continue this engagement with the view of arriving at satisfactory outcomes in the coming months,” the joint statement said.
India and the US have had several trade disputes filed at the Dispute Settlement Body of the Geneva-based World Trade Organisation (WTO) running into decades.
Last October, the US won a trade dispute against India in a case related to the customs duties imposed by India in June 2018 and 2019 on their shipments.
The latest dispute that got resolved at the WTO dispute panel related to steel and aluminium tariffs imposed by the US on exports from India and other countries. The WTO ruled that the US had violated global trading norms, which Washington has said it will not comply with the verdict.
The Biden administration in the recent months have signalled many times that it will not follow the global trading norms laid down by the multilateral body even as it sharpens its trade war with China. In 2018, Trump had even threatened to cancel the US' membership of the WTO.
The joint statement also said that both sides discussed the issue of visas, in which India “acknowledged” the steps being taken by the US “to augment processing of visa applications”.