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US grants $540-million preferential trade access to India

In a significant move, the United States on Wednesday announced a grant of $540 million of preferential trade access to India under its generalised system provisions.

"We have decided to grant about $540 million of preferential trade access under the GSP provisions and we hope that the reduction in tariffs under these provisions would be able to go into effect by the end of the month," US Trade Representative Robert B Zoellick told reporters.

Zoellick, who had an hour-long meeting with the Commerce and Industry Minister Murasoli Maran said these reductions would be notified in the federal register, soon after his return to Washington next week.

The USTR, who is accompanied by five other senior officials said, "This gives us a tangible aspect of trying to improve important trading relationship. US is already India's biggest trading partner and US would like to add more to this."

The GSP, is a trade programme of the US government that grants duty free treatment to specified products that are imported from over 140 developing countries.

US had been denying GSP benefits on over 100 Indian products including agricultural, chemicals and pharmaceuticals India, on the other hand had been pressing for restoration of these benefits.

Commenting on the importance of India for the US, he said that the two sides talked about trade relations - both bilaterally and globally and in the context of the WTO.

Zoellick said during the meeting India emphasised the importance of the implementation agenda. "We talked about that as well as the prospects for Doha," he added.

India would have to take its own decisions regarding Doha, he said.

The purpose of his visit was "more to listen and to learn and to be able to understand some of India's concerns, so that we can bring India and the other 141 countries on board this (visit) is a step in that process", he added.

Zoellick said: "India has much more that it can offer the world as the world's largest democracy. The economic reforms process. I think is producing benefits and part of that will be India's engagement in the international trading system including the WTO process."

The USTR's visit is the first senior (cabinet) level visit by an official of the Bush administration. The USTR will on Thursday hold discussions with the Union Finance Minister Yashwant Sihna, the External Affairs Minister Jaswant Singh. He will also meet Congress president and leader of the opposition in the Lok Sabha Sonia Gandhi.

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