GSP countries including India to benefit from the war between the United States and China

The year-long trade war with China is pushing American companies to source more from GSP (Generalized System of Preferences) countries like India, Thailand, Cambodia, Indonesia, and Turkey, a latest report said on Tuesday, warning that canceling GSP benefits to India would only help China.

According to a report on Tuesday, the Coalition for GSP, a group of American businesses and trade associations, the latest official trade figures show that the Generalized System of Preference or GSP saved USD 105 million in March 2019, an increase of USD 28 million (36 %) from March 2018, and the second highest recorded level.

n the first quarter of 2019, GSP saved American companies USD 285 million. That is USD 63 million more than the first quarter of 2018 — itself a record-shattering year.

GSP is the largest and oldest US trade preference programme and is designed to promote economic development by allowing duty-free entry for thousands of products from designated beneficiary countries.

President Donald Trump, on March 4, announced that the US intends to terminate India’s designations as a beneficiary developing country under the GSP programme. The 60-day notice period ended on May 3.

GSP imports from India are up significantly for products on the Section 301 lists in the first two months of 2019 (recent data available), but slightly down for products where China is not facing new tariffs, according to the coalition. For China, it’s the opposite: imports for products facing new tariffs are down significantly, and up slightly for those who don’t, it said.