The United States and China are still negotiating about trade. While businesses and markets wait for developments on that front, another trading partner in the region is facing a disruption.
President Trump says India “has not assured the United States that it will provide equitable and reasonable access” to its markets. That was one line in a letter that the president sent to Congress Monday night, and it means India faces the end of special trade advantages that it has had since 1976.
The program that India will be leaving is called the “GSP” — or “Generalized System of Preferences” – and it’s designed to ease access to U.S. markets for countries that are developing economies.
This follows months of negotiations between India and the United States.
The action will remove duty-free status on nearly 6 billion dollars of Indian goods sent to the United States — about 12-percent of its total exports to the country.
U.S. companies have complained about a lack of market access in a number of sectors. Two of the highest profile arguments have involved dairy products and medical devices.
Indian media say the New Delhi government was prepared to increase access for farm products, but the medical device issue remained in dispute along with U-S concerns about India’s e-commerce regulations.
The Times of India says the U.S. was insisting that India remove price caps on stents and knee implants.
India’s Commerce Secretary says the loss of trade privileges “will not have a significant impact” on the country.