India downplays impact of GSP withdrawal on trade relations with US

India on Saturday downplayed the possibility of any negative impact on trade relations with the United States, a day after US President Donald Trump said Washington will end its preferential trade treatment on June 5.

India is the biggest beneficiary of Generalised System of Preferences (GSP), which allows preferential duty-free imports of up to 5.6 billion dollars to the United States.

These are unilateral, non-reciprocal and non-discriminatory benefits extended by some developed countries to developing countries. As part of bilateral trade discussions, India had offered resolution on significant US requests in an effort to find a mutually acceptable way forward.

"It is unfortunate that this did not find acceptance by the United States," said a statement issued by the Ministry of Commerce and Industry.

"India, like the United States and other nations shall always uphold its national interest in these matters. We have significant development imperatives and concerns and our people also aspire for better standards of living. This will remain the guiding factor in the government's approach," it said.

In any relationship, particularly in the area of economic ties, there are ongoing issues which get resolved mutually from time to time.

"We view this issue as a part of this regular process and will continue to build on our strong ties with the United States -- both economic and people-to-people," said the statement. "We are confident that the two nations will continue to work together intensively for further growing these ties in a mutually beneficial manner."

On March 5, the United States announced the withdrawal of special duty benefits under the GSP and were to come into force from the first week of May. However, Washington decided to postpone the implementation of its decision until May 23, when India gets a new government.

On Friday, Trump said in a statement: "I have determined that India has not assured the United States that India will provide equitable and reasonable access to its markets.