India is disappointed over the US' seeming unwillingness to come to an agreement with New Delhi on preserving its benefits under the Generalised System of Preferences (GSP), India's Ministry of Commerce said in a statement Saturday.
"India as part of our bilateral trade discussions, had offered resolution on significant US requests in an effort to find a mutually acceptable way forward," the ministry explained. "It is unfortunate that this did not find acceptance by the US."
"India, like the US and other nations, shall always uphold its national interest in these matters. We have significant development imperatives and concerns and our people also aspire for better standards of living. This will remain the guiding factor in the government's approach," the statement added.
"I have determined that India has not assured the United States that India will provide equitable and reasonable access to its markets. Accordingly, it is appropriate to terminate India's designation as a beneficiary developing country effective June 5, 2019," the proclamation read.
An estimated $5.6 billion in Indian goods falling under the GSP made their way into the US in 2017. According to US Trade Representative's Office figures, the US had a $27.3 billion trade deficit with India the same year. President Trump had repeatedly pressured New Delhi to open its markets to US trade to close the deficit, and protested the country's protectionist tariff policies, including recently reelected Prime Minister Narendra Modi's 'Make In India' project.
Earlier, Commerce Secretary Anup Wadhawan assured Indians that President Trump's move would only have between a "minimal and moderate impact."
India's opposition called the Trump administration's Friday move a "double whammy," saying it piled on to economic pressures in India including a 45 year high in unemployment and a five-year low in GDP growth. A Congress Party spokesperson accused the Indian government of "succumbing" to US pressure on crude oil imports from Iran, saying the concession did not prevent Washington from revoking its special GSP status. According to the spokesperson, up to 66 per cent of India's exports to the US will be affected by the removal of the trade preferences.
The Trump administration has started trade conflicts with most of its major trade partners in recent years, threatening to impose tariffs on all goods coming from Mexico earlier this week unless the country cracks down on illegal immigration into the US, and waging a multi-round trade war with China over that country's whopping $222.6 billion trade surplus with the US.
