Generalized system of preferences (GSP) of US Government which expired on July 2013, after 18 months renewed to till December 31, 2017 enabling duty-free entry of 3,500 product lines.
- Indian exports to the US, which includes items such as textiles and gems and jewellery, will benefit from the US government’s move to extend duty waivers to products from developing countries.
- According to the US Trade Representative’s office, the GSP is a renewable preferential trade programme that allows the eligible products of developing countries to enter directly to US free of duty.
- S C RALHAN,President of Federation of Indian Export Organisations (FIEO) said that it will benefit Indian exports which will get duty advantage in respect of 3500 tariff lines and the duty benefits across these items range from 4-6%.
Generalized System of Preferences:
- The Generalized System of Preferences is a preferential tariff system which provides for a formal system of exemption from the more general rules of the World Trade Organization (WTO) formerly, the General Agreement on Tariffs and Trade.
- GSP exempts WTO member countries from MFN for the purpose of lowering tariffs for the least developed countries, without also lowering tariffs for rich countries.
- GSP is presently extended by 29 developed countries.
- It involves reduced Most Favored Nation (MFN) Tariffs or duty-free entry of eligible products exported by beneficiary countries to the markets of donor countries.
- Rules of origin comprise a set of requirements laid down by the importing country, which must be fulfilled by a product to be eligible for preferential tariff treatment upon import in that country.
- There are three components of rules of origin- Origin Criteria, Transport Conditions and Documentary Evidence.