A top Republican lawmaker has urged the US trade agency to put on hold its decision to terminate preferential trade status granted to India till the general elections in the country are over.
US President Donald Trump this month informed the US Congress about his intent to terminate the designation of India as a beneficiary developing country under Generalized System of Preferences (GSP) programme that facilitates duty free import of certain products from underdeveloped countries to help grow their economies.
Under the United States GSP programme, nearly 2,000 products including auto components and textile materials can enter the US duty-free if the beneficiary developing countries meet the eligibility criteria established by the Congress.
India was the largest beneficiary of the programme in 2017 with $5.7 billion in imports to the US given duty-free status, according to a Congressional Research Service report in January.
Republican Congressman George Holding in a letter to US Trade Representative Robert Lighthizer has urged to delay the termination to be able to have a more productive conversation free from the turmoil of politics.
"It is my request that the administration postpone the termination of India's GSP eligibility and revisit this decision after India's general election. At that point, we would be free from the turmoil of politics and would
be able to have a more productive conversation," Holding said.
Holding is Republican Co-Chair of influential Congressional India caucus.
"I believe, the administration, and the US companies would be better served if India's termination from the GSP programme were put on hold until after the elections conclude in May," Holding said in the letter.
"While I understand the administration's intent to terminate India's eligibility finder the GSP programme, I believe it is important to consider that India is in the midst of general elections," said the Congressman from North Carolina.
In his letter dated March 27, Holding argued that it is in the best interest of all parties for India to institute meaningful market access reforms.
"However, it is my concern that by terminating India's GSP eligibility so close to their elections we politicise these negotiations and hinder a successful outcome," he said.
"Even worse, terminating their eligibility now politicises these negotiations and undermines our chances for a successful outcome," Holding warned.
In his letter, Holding applauded the Trump administration's efforts to ensure India provides reasonable market access to the US companies and does not institute unfair trade barriers that hinder commerce.