President Donald Trump decided to terminate both India and Turkey from the Generalized System of Preferences program (GSP) after a review of the countries’ GSP benefits. The U.S. dairy and medical device industries had requested a review for India after stated that India’s policies were unfairly blocking their exports, while Turkey was under review by USTR when Trump doubled his national security tariffs on steel and aluminum for the country.
India’s termination from GSP comes after it failed to provide the U.S. with assurances that it would provide equitable and reasonable access to various sector markets. Turkey’s termination was a result of the U.S finding that the country has sufficiently developed economically. Trump sent letters to Congress notifying them of the change, starting a 60-day period before the two countries are officially removed from the program.
This move would raise duties on about $5 to 6 billion worth of goods the U.S. imports from India and could potentially provoke New Delhi to retaliate against the steel and aluminum tariffs imposed last year.
There was some criticism from supporters of the GSP program who said the move would increase tariffs paid by U.S. employers and hurt American exporters. In a statement made by Senate Finance Committee Chairman Chuck Grassley, he sounded hoped that the two sides would make amends before the end of the 60-day period. He stated, “For the sake of the many Americans and Indians who relied on GSP benefits, I hope that India will work to quickly address the legitimate concerns.”