It took a long wait of more than 18 months, but eventually the US Government did renew the Generalized System of Preferences (GSP) thereby enabling the duty-free entry of close to a whopping 3,500 product lines from Indian Exporters. These product lines are slated to include merchandise from numerous verticals including textiles, gems and jewellery, engineering and chemical products. This renewal has been given a retrospective extension ranging from the bygone August 2013 to December 2017.
With the help of the GSP, a large number of both, industrial as well as agricultural products that originate in India will find their way to the American market place. This preferential access to the market is offered as a result of reduced rates of custom duties. Since the move is made in a retrospective manner, the US Customs and Border Protection, also known as the CPB will now readily accept claims for the duty-free treatment pertaining to GSP, for all merchandise that either entered the US borders, or was withdrawn from local warehouses, with the purpose of consumption. The CBP has also agreed to process the refunds on the duties on the products that entered the US borders, during the time that the GSP had lapsed, although no interest will be reimbursed on the amount.
The renewal requires both non-Automated Broker Interface(ABI) filers as well as ABI filers to submit their requests for duty refund, in case their entry did not include the Special Program Indicator Code ‘A’. In such cases, the CBP will verify each request, and duly ensure that the benefits of GSP are availed only to the eligible entries.
For electronically filed entries through the ABI with the SPI code, the filers need not initiate the refund process, as it will be done automatically by the CBP.
This move has received a warm welcome by the Indian textile fraternity. The President of Federation of Indian Export Organisations, Mr. SC Rahlan agreed that the renewal of GSP will benefit the nation’s exports, and will also contribute in increasing competitiveness of Indian goods in the American market. Mr. Ajay Sahai, the CEO of Federation of Indian Export Organisations, also expressed his thoughts on the renewal, saying that the move will boost the exports to the American market, and since the demand is on the rise it will eventually benefit the Indian exporters. This will help in increasing the competitiveness, thereby resulting in a great turnaround for all merchandise exports. He added, that the renewal has been a demand of Indian exporters for quite some time now, and hence is a welcome move.
It can be fairly concluded that the renewal of GSP is expected to create a rise in the overall quantum of exports from the Indian markets to the American markets, thus proving to be highly beneficial for both importers as well as exporters of textiles. The increased demand in the US markets will only help in accentuating these benefits for the Indian exporters.