The US has finally renewed the Generalised System of Preferences (GSP) for Indian exporters retrospectively from August 2013, enabling duty free entry of 3,500 products. Timely renewal of GSP is important for maintaining stable bilateral trade between the two countries and to avoid uncertainty in bidding for any new business.

This was the longest delay by the US in renewing GSP. The benefit had lapsed in July 2013. It has been extended till December 2017. The move is expected to benefit exporters of textile, engineering, gems and jewelry and chemical products, among others, as their biggest market is the US.

In GSP a wide range of industrial and agricultural products originating in certain developing countries are given preferential access to American markets. This is given in the form of reduced or zero rates of customs duties. It was introduced by the US in 1976.

The GSP program helps developing countries expand their economies by increasing exports to the US and it also aids US businesses by lowering the cost of imported goods that are used as inputs in value-added US production. Therefore it helps in keeping products made in America competitive for both domestic consumption as well as US exports.