The textile industry has said US’ withdrawal of preferential trade benefits available to India under the Generalized System of Preferences (GSP) will have no major impact on the sector.

“The removal of US GSP on India’s apparel exports will have marginal impact, but we still will be taking up the matter with the Union commerce ministry,” said Sanjay K Jain, chairman, Confederation of Indian Textile Industry (CITI).

Jain said there are 15 products in the ready-made garments (RMG) (HSN 61 & 62) category under US GSP, which contributes to $586.58 million RMG imports of US. India’s share in the segment is $17.97 million. The most favoured nation (MFN) tariff in 15 products varies from 0.86% to 14.60% in which India gets duty access with 100% margin of preference.

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It is to be noted that these 15 products contribute only 0.46% of India’s apparel exports, in which bulk of the benefit is concentrated on the product 62044910 (silk woven clothing of women) which comprises 58.5% of India’s total trade under GSP.

The figures have been identified on the basis of current trade with the US, and 11 products have negligible impact on India’s apparel exports to the country, Jain pointed out. “Luckily, the GSP preferential items that may lose the status from the US only contributes 0.5% of India’s apparel exports. We are following up with the Centre and hope the status quo is maintained,” he said.

Some of the products eligible for US GSP include gloves, mittens and mitts.

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Shawls, scarves among other items, not knitted or crocheted, containing 70% or more by weight of silk or silk waste will see moderate impact.

According to Raja Shanmugam, president, Tirupur Exporters’ Association (TEA), “We don’t see any major impact. The move seems to be a knee-jerk reaction to support major online/e-commerce players, who seek to destabalise Indian economy. It is detrimental to India’s free e-commerce policy.

The US always interfere, and try to protect its own interest as well its businessmen. India needs to learn and follow the US principles when it matters more to the country.”

According to him, the game plan of the multinational companies involved in the business is proving out to be dangerous for the country.

India should support domestic exporters and their welfare, he said, adding, “We should not react to pressure tactics by the US as it always has ulterior motive behind it actions. Hence, it is time for the Union government to suitably counter and protect the domestic industry.”