GSP removal to also impact US firms
Indo-American Chambers of Commerce stated in a recent meeting held in collaboration with KPMG that American firms operating in India will have to shell more from their pocket in the post-GSP regime. While the termination of GSP will negatively impact India’s exports to US, it will also have a negative effect on US firms in India as their tax burden will grow by an additional US$ 300 million every year. This could further mean job cuts, scaling down investment plans and more prices for consumers.
In 2017, India was the largest beneficiary of the Generalized System of Preferences programme (GSP) with US$ 5.7 billion of its imports being given duty free status. Around 2,000 products enjoyed duty-free entry into US earlier. The association noted that the 2 nations should iron out their differences on irritants like data localisation & visas; and explore areas like agro-processing, energy, infrastructure and defence.