US May Withdraw Zero Tariffs for India
- 09 Feb 2019
- 2 min read
- The US Trade Representative (USTR) is reviewing the preferential arrangement for India where the US charges no tariff on certain exports from India to the US under the Generalized System of Preference.
- India's FDI policy on e-commerce and mandatory data localization for global card payment companies have led to the US to review zero tariff policy.
- India revised its FDI policy on e-commerce banning online retailers like Amazon and Walmart-owned Flipkart from selling products of companies in which they have stakes in.
- The Reserve Bank of India (RBI) issued guidelines stating that all foreign payment companies such as MasterCard and Visa must store data locally for their businesses in the country.
GSP (Generalized System of Preferences)
- The idea of granting developing countries preferential tariff rates in the markets of industrialized countries was originally presented at the first UNCTAD conference in 1964.
- The GSP was adopted at UNCTAD in New Delhi in 1968 and was instituted in 1971.
- There are currently 13 national GSP schemes notified to the UNCTAD secretariat.
- The following countries grant GSP preferences: Australia, Belarus, Canada, the European Union, Iceland, Japan, Kazakhstan, New Zealand, Norway, the Russian Federation, Switzerland, Turkey and the United States of America.
- GSP is the largest and oldest U.S. trade preference program. Established by the Trade Act of 1974, GSP promotes economic development by eliminating duties on thousands of products when imported from one of 120 designated beneficiary countries and territories.