The US recently announced the termination of its Generalized System of Preferences (GSP) designation for India. If this cost is completely absorbed by Indian exporters, the withdrawal would translate into a loss to India of about $200 million. Regardless, the costs of GSP withdrawal are quite modest. Negotiating ticklish trade disputes with an unpredictable but powerful partner will require a delicate balancing act. On the other hand, not reacting could well be perceived as weakness and set India up as a soft target for Trump’s next trade tantrum.

Source: Mint June 15, 2019 13:52 UTC