India's hopes for export relief in the US are nearing an end

Washington, Ta. February 13, 2020, Thursday

US President Donald Trump has given a positive signal about the trade deal before his first visit to India on February 24, but the US has hit India before it could have a serious impact on the country's exports. In fact, the US has excluded India from the list of 'developing countries' in terms of trade. Its significance is that India will no longer be in the special countries whose exports are exempt from CVD scrutiny.

The US Trade Representative (USTR) has dropped India off its list of developing countries this week. The implication is that India will no longer be in a country whose exports are relieved by the Countervailing Duty (CVD) investigation. Under CVD, exporting countries are investigated by improper subsidized exports, not harming American businesses.

Apart from India, Brazil, Indonesia, Hong Kong, South Africa and Argentina have been excluded from the list. However, the American system says the list was made in 1998 and is now extraneous.

One of the biggest disadvantages of putting India out of the list of developing countries is that the change in the much-needed Generalized System of Preferences (GSP) list for America has left water on India's hopes of being included in the list. This list of many types of benefits is kept only in developing countries.

That is, the United States has cleverly closed the ways for India to be included in this list. Last year, when the US excluded India from the list, India argued that GSP benefits should be available to all developing countries without any bargaining conditions, and that the US could not use it to advance its business interests.

However, the US says that India has now become a member of the G20 and its share in world trade is more than 0.5%. We rank the countries in the developed countries in terms of CVD law, with countries accounting for more than 0.5% of global trade.

This move from the US will have to go through many obstacles in the export of Indian products. If an American industry lobby alleges that a product is harming American interests due to subsidy from the Indian government, its investigation will begin and export to the United States will stop.

The US placed 6.35 billion exports of goods under GSP in 2018-19. Although the total Indian exports to the US amounted to $ 51.4 billion, the expiry of GSP would make it difficult to export Indian jewelery, leather, pharma, chemicals and agricultural products.