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Generalised System of Preferences(GSP)
Why is it in the news ?
- Indian Exporters appear to be confused on whether exports to the U.S. eligible for duty-free entry into the U.S. under the Generalised System of Preferences (GSP).
- Under the GSP, the U.S. grants eligible countries duty-free entry into the country for about 4,800 products.
More in the news
- The U.S. is now reviewing whether India is still eligible for GSP benefits, even as the Indian government is maintaining that exporters can still receive the benefits.
- There is policy uncertainty and the resultant confusion are leading to a diversion of orders meant for India to neighbouring countries.
- One of the largest exporter-bodies has said that its members have not been receiving the benefits since December 2017.
- However, the Engineering Export Promotion Council of India has claimed that its members are still availing of the GSP benefits.
- It is affecting India's MSME exporters.
What is GSP ?
- The Generalized System of Preferences (GSP) is a U.S. trade program designed to promote economic growth in the developing world.
- It provides preferential duty-free entry for up to 4,800 products from 129 designated beneficiary countries and territories.
- India’s case, GSP enables duty-free entry of 3,500 product lines in US markets.
- GSP was instituted on January 1, 1976, by the Trade Act of 1974.
- A wide range of industrial and agricultural products originating from certain developing countries are given preferential access to US markets.
Source
The Hindu.