India, US to revive Trade Policy Forum after 4 years:
The U.S. Trade Representative Katherine Tai, is in India for the U.S.-India Trade Policy Forum (TPF) meeting.
- The meeting was co-chaired by Commerce and Industry, Textiles, Consumer Affairs and Food & Public Distribution Minister Piyush Goyal and U.S. Trade Representative, Ambassador Katherine Tai,
- India and the US have agreed to revive their Trade Policy Forum, after four years. It will help in deepening bilateral trade by establishing regular contact and resolving obstacles.
The main trade related issue between India and U.S are as follows:
- India wants the US to restore the GSP (Generalised System of Preferences ) to India which was withdrawn in 2019.
- India is seeking exemption from high duties imposed by the US on some steel and aluminium products under the GSP, and greater market access for its products from sectors such as agriculture, and automobile.
- US wants: The US wants greater market access for its farm and manufacturing products, dairy items and medical devices, apart from cut in import duties on some information and communication technology products.
The India-US Trade Policy Forum has five focus groups:
- Innovation and creativity (intellectual property rights),
- Tariff and non-tariff barriers.
India-US Trade Policy Forum:
- India US Trade Policy Forum (TPF) was set up in 2005 and reconstituted in 2014.
- The Minister of Commerce & Industry, Government of India, and Office of the US Trade Representative are the nodal agencies.
- The United States is the second largest trading partner of India.
- while India is its 9th largest trading partner.
- The US is also India’s largest investment partner.
GSP(Generalized System of Preferences )
- The Generalized System of Preferences (GSP) was started in 1971 under the aegis of the United Nation Conference on Trade and Development (UNCTAD).
- The main aim of the GSP is to create an enabling trading environment for developing countries, especially least Developed Countries (LDC).
- At Present, the following 15 countries grant GSP preferences: Armenia, Australia, Belarus, Canada, the European Union, Iceland, Japan, Kazakhstan, New Zealand, Norway, the Russian Federation, Switzerland, Turkey, United Kingdom and the United States of America.
How does it work?
- Suppose the US provides GSP status to India on certain goods like Cotton bedsheets.
- Now the United States will not impose any tax on cotton bedsheets imported from India.
- Suppose China is not provided with the GSP status by the US. The cotton bedsheet which is exported to the United States by China will be taxed in the U.S. It will make the Chinese bed sheets costly as compared to Indians and hence the American public will prefer to buy Indian bedsheets. It will boost Indian exports to the United States and benefit Indian manufacturers.
Why was it withdrawn from India?
- The Donald Trump administration in the United States withdrew the GSP status to India from 5 July 2019.
- According to the US, India was not providing “equitable and reasonable access to its goods and service in the Indian Market.
- The US government demanded that the Indian Government change its policy on price caps on medical equipment, removal of certain mandatory certifications for dairy product exports, e-commerce policy, etc.
Please Rate this article, so that we can improve the quality for you -