Generalized System of Preferences Status

Facts for Prelims

Generalized System of Preferences Status

News: India has sought restoration of the preferential access to the US market that was revoked by Washington in 2019. 

What is GSP?
• 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 119 designated beneficiary countries and territories. 
• It was 1st instituted by the UNCTAD conference in 1971. 

When was GSP status of India terminated?
• President Donald Trump has terminated India’s designation as a beneficiary developing nation under the key GSP trade programme due to India’s failure to provide the United States with assurances that it will provide equitable and reasonable access to its markets in numerous sectors 
• India was the largest beneficiary of the Generalized System of Preferences (GSP) status in 2017, with $5.7 billion worth of imports into the US given duty-free status. About 2,000 products including auto parts and textile materials were allowed to enter the US duty-free.