As US scraps GSP sops to 50 Indian products, handmade carpet export to be impacted most

New Delhi, Nov 2 (KNN) As the US on Thursday revoked duty-free concessions on import of at least 50 Indian products, mostly from handloom and agriculture sectors, the move is likely to impact more the exporters of handmade carpets.

The federal register issued a notification, listing out 90 products which were so far subject to duty-free provisions under the Generalised System of Preferences (GSP). As India is one of the largest beneficiary of the GSP, it has been hit the most by the decision.

GSP allows duty-free import for thousands of products into us from designated beneficiary-countries.

President Donald Trump issued a presidential proclamation on Tuesday, leading to the removal of these products from the privilege beginning November 1.

In 2017, India’s duty-free export to the US under the GSP was to the tune of more than USD 5.6 billion.

Out of 50 products from which duty-free concessions on import have been revoked, many products are manufactured by the micro, small and medium enterprises (MSMEs), in particular the handloom and agricultural sectors.

Talking to KNN India, Animesh Saxena, Director, Neetee Clothing and Executive Member of Apparel Exporters & Manufacturers Association, said, “As US has cancelled duty free concessions on imports of 50 Indian products including textiles and handmade carpets; the impact of this move will be more on exporters of handmade carpets as India’s export to US is highest.”

The top leading countries in carpet imports from India have been the US and Germany, he added.

As far as handloom sector is concerned, this will not be impacted much as such because its export share is very less, Saxena said.

“The impact of this on manmade textile materials exports will be moderate but yes handmade carpet sector will get more affected,” said Saxena.

Arvind Sinha, President of The Textile Association said that the move of cancelling duty fee concessions would not impact Indian MSMEs as goods will start going via Vietnam as the concession rates are same.

He said, “Our trade with USA has gone up. It has multiplied now particularly on garments. The trade has considerably improved.”

Big programs like America first and make in India is already going on, which will create another USD 30-40 billion trade opportunities, Sinha added.

Among the products listed are dried pigeon pea seed; areca nuts, fresh or dried, in shell; turpentine gum; mangoes, prepared or preserved by vinegar or acetic acid; sandstone, merely cut into blocks or slabs of a rectangular (including square) shape; tin chlorides; barium chlorides; salts and esters of tartaric acid, nesoi; and trimethyl phosphite.

Full grain unsplit or grain split buffalo hide or skin; grain split whole buffalo leather, without hair on; whole buffalo skin leather (not full grain unsplits/grain splits); and full grain unsplit buffalo leather, are also on the GSP list. Dyed, plain weave certified hand-loomed fabrics of cotton, containing 85 per cent or more cotton; plain weave certified hand-loomed fabrics of cotton, hand-loomed carpet and other textile floor coverings, woven, made up of man-made textile materials have also been removed.

These can still be exported to the US from India, but they will be subject to regular tariffs.

Meanwhile, India, for the third time, extended the deadline for the imposition of higher customs duties on 29 US products, including almond, walnut and pulses, by another 45 days until December 17. (KNN Bureau)