Trump to halt trade preferences for India and Turkey

India was the largest beneficiary of the programme in 2017 with $5.7bn in imports to the US given duty-free status

FILE PHOTO: U.S. President Donald Trump holds a bilateral meeting with India's Prime Minister Narendra Modi alongside the ASEAN Summit in Manila, Philippines November 13, 2017. REUTERS/Jonathan Ernst/File Photo
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President Donald Trump delivered notice Monday he plans to end key trade preferences for India and Turkey.

Trump notified Congress in letters of his “intent to terminate” trade benefits for both countries under the generalised system of preferences. The notification starts a 60-day countdown before the president can take the action on his own authority, the US Trade Representative’s Office said in a statement.

Their designation under the programme allows duty-free entry of about 2,000 products including auto components, industrial valves, and textile materials. The president can still walk back his notice to terminate the preference programmes if the two countries satisfy the concerns of his administration.

India was the largest beneficiary of the programme in 2017 with $5.7 billion in imports to the US given duty-free status and Turkey the fifth largest with $1.7bn in covered imports, according to a Congressional Research Service report issued in January.

The US said in April it would review India’s eligibility for the generalised system of preferences programme after some US companies said dairy and medical devices shipments to India were being hurt by non-tariff barriers.

Mr Trump said in a notification letter that India “has not assured the United States that it will provide equitable and reasonable access to the markets of India.”

He said in a separate letter that Turkey is no longer a “developing country based on its level of economic development.”

Mr Trump’s decision comes at a difficult time for India’s prime minister, Narendra Modi. He faces a general election in a few weeks even as the longstanding animosity between India and Pakistan has escalated into violent clashes that could lead to all-out war.

Mr Trump has had several disagreements with Turkey’s leader, Recep Tayyip Erdogan. His country’s once-robust economy has weakened, and that will likely be a key issue in local elections at the end of the month.