The Trump administration has been requested by a bipartisan group of 44 influential lawmakers to reinstate India’s designation as a beneficiary developing nation under the main GSP trade programme as part of a potential trade deal between the two countries.

In June, US President Trump terminated India’s designation as a beneficiary developing nation under the Generalised System of Preferences or GSP. The GSP is the oldest as well as the largest US trade preference programme that aims to promote economic development by allowing duty-free entry for thousands of products from designated beneficiary countries.

The House members in a letter to US Trade Representative Robert Lighthizer suggested an “early harvest” approach that “would ensure that long-sought market access gains for US industries are not held up by negotiations over remaining issues”. The letter has been signed by 26 Democrats and 18 Republicans.

A media report informed that Prime Minister Narendra Modi and US President Donald Trump will meet on September 22 in Houston and they will be announcing the potential deal on several trade issues including GSP.

On Tuesday, Dan Anthony, executive director of the Coalition for GSP stated, “Companies are telling Congress about the American costs – both in dollars and jobs – of lost GSP eligibility for India.”

“The letter shows Congress’s strong, bipartisan support for swift action to reinstate GSP for India and to help constituents that depend on two-way trade,” he said.

The foreign countries have often been benefited by GSP while American businesses and workers that have suffered most from its termination to date. As compared to 2018, imports from India of GSP-eligible products increased over 40 per cent in July 2019, despite facing higher tariffs due to lost GSP.

“Indian exporters are thriving while American companies are stuck paying USD 1 million a day in new tariffs,” said Mr Anthony.

In the letter, the lawmakers said that they have a strong desire to see GSP eligibility for India reinstated. “Should there be progress in negotiations, we hope you will use the tools provided by the GSP statute as warranted, such as partial reinstatement,” the letter said.

“The costs are real for our constituents and growing every day. We urge you to continue negotiations and consider an early harvest to help American jobs that depend on two-way trade between the United States and India,” they said.

The lawmakers further raised the matter in the letter, those policies are affecting US companies that are trying to access its market. “As you know, several US industries filed petitions under GSP’s market access criterion, which were accepted for review in April 2018. Ultimately, failure to make sufficient progress on the issues led to termination of India’s GSP eligibility on June 5, 2019,” they added.

The Congressmen further wrote, “We are encouraged to see continued engagement between the administration and the newly elected Government of India that assumed office in late May, including visits by senior USTR and Indian officials over the summer.”

“The change in government provides a fresh opportunity to address outstanding concerns, and we hope that new Indian officials will offer concrete solutions that improve market access for American companies and workers,” the Congressmen wrote.

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