Foreign Policy Digital

India is Trump’s Next Target in the Trade War

Ending India’s preferential trade treatment won’t hurt economically—but it is politically dangerous.

Just as tensions with China have started to ease, U.S. President Donald Trump has opened a new front in his trade war: India. On March 4, 2019, he fired the first shot by notifying Congress of his intention to end the favorable treatment India has enjoyed under the Generalized System of Preferences (GSP). Negotiated during the 1970s under the auspices of the General Agreement on Tariffs and Trade, and later subsumed into the World Trade Organization, GSP allows many products from India and other developing countries to enter the United States duty-free.

Trump’s decision to end GSP did not come as a surprise. Despite close cooperation between the world’s two largest democracies in defense and other areas, trade relations between them have been prickly for some time. They acquired an extra

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