US Congress asked to renew trade preferences for India, others

WASHINGTON: The US administration has urged the Congress for early renewal of a GSP mechanism under which imports from developing and least developing countries, up to a limit, are allowed a preferential access to the American market.

The Generalised System of Preferences (GSP) which covered several countries, including India, Brazil, Thailand, Pakistan and Afghanistan had expired in December 2010 affecting their exports.

US Trade Representative Ron Kirk and Secretary of State Hillary Clinton have raised the issue of "reauthorisation" of GSP with the Congress.

In a letter to Congress Speaker John A Boehner, they said, "We urge Congress to reauthorise the GSP...at the earliest opportunity and for the longest period possible so that we can keep faith with the American worker, support US jobs, promote economic development overseas..."

Moving GSP imports from the docks to US consumers, farmers and manufacturers supports over 80,000 US jobs, it said.

Under the GSP, Indian handicraft items--brass lamps, carpets and engineering products--power generators were among the few items given preferential duty-free access to the US to the tune of USD 3.5 billion in 2010.

The Indian exports under GSP were the third largest in 2010.

Both the governments have been negotiating on the "reauthorisation" of the agreement for quite some time.

The Kirk-Clinton letter said, if the programme is not authorised well in time then "...many US importers (from India, Brazil, Thailand) may be forced to find other sources."

Last week, the Commerce and Industry Minister Anand Sharma also raised the issue with Kirk in Washington.

The Export Promotion Council for Handicrafts (EPCH) has also been pressing the Indian and US government to re-certify the programme. "We are already pursuing it with US government and our ambassador to US is taking up the issue. We have to wait," EPCH Chairman Arvind Vadhera said.

Total imports to US under GSP from the developing and LDCs were worth USD 22.5 billion in 2010.

Expressing the same view, Apparel Export Promotion Council Chairman Premal Udani said: "Negotiations are going on...let's formalise the agreement. Informally, the trade is going on, there are no disruptions."