India's apparel exports to US rise 5% post withdrawal of duty concessions

"Balance of apparel trade was in favour of India by $4 billion during 2018. Post-withdrawal of GSP, imports of apparel will be subject to higher tariff."

India's apparel exports to the US post removal of duty concessions under Washington's Generalized System of Preferences programme has seen a rise of 5 per cent compared to the same period last year when the duty benefits were available, Parliament was informed on Thursday.

US President Donald Trump in July 2019 terminated India's designation as a beneficiary developing nation under the key Generalized System of Preferences (GSP) trade programme after determining that it has not assured the US that it will provide "equitable and reasonable access" to its markets earlier this year.

"Balance of apparel trade was in favour of India by USD 4 billion during 2018. Post-withdrawal of GSP, imports of apparel will be subject to higher tariff. As per provisional data, exports of apparel (post withdrawal of GSP) has increased by 5 per cent as compared to the corresponding period before withdrawal," Textiles Minister Smriti Irani said in a written reply in the Rajya Sabha.

Replying to a a separate query, she said the Textile industry in India is subject to provisions of the WTO Agreement on Subsidies and Countervailing Measures (ASCM) which stipulate that if a developing country member's exports of a product have reached a share of at least 3.25 per cent of world trade of that product for two consecutive calendar years, it will be considered as export competitive in that product.

"Further, export subsidies on such products shall be gradually phased out over a period of eight years. As per this provision, India is obligated to phase out subsidies which are export contingent," Irani said in another written reply in the Rajya Sabha.