Donald Trump withdraws GSP duty benefits for India: Seven charts decode India-US trade over a decade

US President Donald Trump on Tuesday announced plans to scrap the preferential trade treatment for India, claiming that New Delhi has failed to assure the US of “equitable and reasonable” access to its markets, a move India said will not have a “significant impact” on its exports to America. The move to end the Generalised System of Preferences (GSP) for India and Turkey is the latest push by the Trump administration to redress what it considers to be unfair trading relationships with other countries like China. Trump has pledged to reduce US trade deficits, and has repeatedly called out India for high tariffs. [caption id=“attachment_5298951” align=“alignleft” width=“380”] File photo of US president Donald Trump and Prime Minister Narendra Modi. Reuters[/caption] 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 Congress. India was the largest beneficiary of the programme in 2017 with $5.7 billion in imports to the US given duty-free status and Turkey the fifth largest with $1.7 billion in covered imports, according to a Congressional Research Service report issued in January. As many as 3,700 products get GSP benefits but India exports only 1,900 items such as chemicals and engineering under that concession which was introduced in 1976 by America. Here are seven charts that depict India’s trade with the US: In fiscal ended March 2018, India’s total trade with the US was at $74.5 billion, according to Commerce Ministry data. The US was the second largest trading partner after China. In FY18, India had an $89.7 billion trade with neighbouring China. Merchandise trade with the US accounted for 9.7 percent of India’s total trade with all countries in fiscal 2018. With $49.9 billion, UAE was the third major trading partner in last year. In the past ten years, India’s exports to US jumped by 131 percent from $20.7 billion in FY08 to $47.9 billion in FY18- growing at a CAGR (compounded annual growth rate) of 8.75 percent. India’s imports from the US has risen by 26 percent in the past 10 years from $21.1 billion in FY08 to $26.6 billion in FY18. It grew at a CAGR of just 2.34 percent. India’s total trade (exports plus imports) with the US has surged 78 percent during the past ten years from $41.8 billion in FY08 to $74.5 billion in FY18. In FY08, India had a trade deficit of $336 million with the US. The country exported goods worth $20.7 billion to US while it imported goods worth $21 billion from it during that year. However, from FY09 onwards India started exporting more goods to the US. As a result, India’s trade surplus with the US ballooned to $21.3 billion in FY18 from $2.6 billion in FY09. (With PTI inputs)