How the US withdrawal of GSP could hit India's garments exports

If readymade garments are also targeted, the impact would be huge as 30-35% of the merchandise in this space goes to the US

US President Donald Trump plans to end the preferential trade status granted to India may have negative impact on textile exports from the country.

Normally, developed countries offer import duty sops to underdeveloped and developing ones for import of goods. These incentives are not available to other developed countries from whom the goods are being sourced. Such a sustem of preferential treatment to developing countries is known as generalized system of preferences (GSP) in trade parlance.

“The existing list of products for withdrawal of GPS may not have a major impact on India’s garments exports. But, if the list is expanded to