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An early solution for restoration of GSP benefits by the US to Indian exporters is the need of the hour as it would help further boost the bilateral trade, Chairman of the CII national committee on EXIM Sanjay Budhia said on Wednesday.
India and the US have agreed to discuss New Delhi's demand for restoration of Generalized System of Preferences (GSP) benefits to domestic exporters and now both sides will commence discussions to find a solution.
The previous Trump administration in the US revoked GSP from India in 2019. GSP allows eligible developing countries to export duty-free goods to the US.
Budhia said about two-thirds of the US imports under GSP are raw materials, components, or machinery and equipment used by US companies to manufacture goods in America for domestic consumption or for export.
GSP also helps American consumers by eliminating duties on a variety of usually inexpensive consumer goods, he said adding these benefits are real and tangible.
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Both sides have mutually agreed to discuss and find a solution. The earliest solution is the need of the hour, Budhia, who is also Managing Director of Patton Group, said.
He added that as there are huge opportunities of cooperation between the two nations, there is a need to fast-track the economic partnership to achieve the target of USD 500 billion by 2030.
The move to resolve and settle a few bilateral trade issues will create a congenial economic environment for development which will further strengthen the relationship between the two economies.
The decision to end these trade disagreements at the WTO is a big step and will ensure that companies of both countries now can do business at enhanced level with mutual confidence and trust. A very pertinent and crucial issue which needs to be settled at the earliest is the restoration of GSP benefits to Indian exporters, he added.
GSP allows eligible developing countries to export duty-free goods to the US.
About 1,900 Indian products from sectors such as chemicals and engineering were getting duty-free access to the US market under GSP, introduced in 1976.
Pending restoration of the GSP programme, all products are being exposed to full rate of import custom duties. The GSP programme aids American businesses by lowering the cost of imported goods that are used as inputs in value-added US production, Budhia said.
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