Donald Trump Wants to End India's Preferential Trade Treatment

Guwahati: United States President Donald Trump intends to end India's preferential trade treatment under a program that allows Rs. 560 crores worth of Indian exports to enter the United States duty-free.

Trump has repeatedly called out India for its high tariffs as he has vowed to reduce US trade deficits.

In a letter to congressional leaders, Trump said, "I am taking this step because after intensive engagement between the Government of India and United States, I have determined that India has not assured the US that it will provide equitable and reasonable access to the markets of India.

The Office of the US Trade Representatives however, said that by removing India from the Generalized System of Preferences (GSP) program would not take effect for at least 60 days after notifications to Congress and the India Government and it will be enacted by a presidential proclamation.

According to the US Trade Representative's Office, the US goods and services trade deficit with India was around Rs. 194 crores in 2017.

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.

India unveiled new rules on e-commerce which hurt the US-India trade ties. The new rules restrict the way Amazon.com Inc and Walmart Inc-backed Flipkart do business.

The rules of e-commerce followed a drive by New Delhi to force global card payments companies such as Mastercard Inc and Visa Inc to move their data to India and the imposition of higher tariffs on electronic products and smartphones.

On Saturday, Donald Trump accuses India of being a high tariff nation and threatened to charge a reciprocal tax to match heavy duties imposed on goods imported from the United States. He said that India is a very high tariff nation. "When we send a motorcycle to India, they charge 100 percent tariff. When India sends a motorcycle to us, we charge nothing. I want a reciprocal tax, at least I want to charge a tax," said Trump.

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