The United States has taken a ‘U’ turn on Monday by withdrawing India and several other countries from their list of developing countries. This decision is taken ahead of US President Donald Trump’s two-day visit to India starting from February 24.
US Removes India From Developing Nations Status
The office of the US Trade Representative (USTR) issued a notice this week, in which it had decided to end the tag of India along with 24 other nations including China as developing nations rather they are placed in the list of developed nations. Its impact would be counterproductive as these countries will be disqualified to get the benefits given by the United States to the developing nations.
Harsh Step by the US
The US has taken this step despite India being a G-20 member and its share in world trade is 0.5 per cent or more. This move has created a difficulty for India to get preferential benefits under the Generalised System of Preference (GSP) as part of India’s trade talks with the US, while the developing nations are liable for such advantages.
A challenge for India
The Trump administration’s move by listing India as a developed nation has created a huge challenge for prime minister Narendra Modi. It seems Trump is bringing boxes of bitter gourds rather than sweets in his upcoming visit to India. An old ally of the BJP, Shiv Sena has said that its impact would be grave for India,“Our Prime Minister will surely find a way to turn this bitter news into sweet news”.
India needs benefits
At present, India is not in a position to be considered as a developed nation seeing the unsatisfactory conditions in sectors like education, health, employment, poverty and so on. This way India will be deprived of subsidies and the US tax benefits because of this new ruling of the US.
WTO provides subsidies
The World Trade Organization (WTO) provides plenty of subsidies to developing nations. Hence, Trump has decided to debar countries like India, China and South Korea from the list of developing countries. This decision of Trump is aiming to win the hearts of the Americans in the upcoming US presidential elections scheduled to be held at the end of the year.