The Generalised Scheme of Preferences (GSP), a duty benefit programme, has been discontinued by the UK, which could have an effect on India’s exporters of items having a high labour content.
India’s exports from a few labor-intensive industries may suffer if the UK decides to end its participation in the Generalised Scheme of Preferences (GSP), which provides duty benefits. GSP will be replaced by a new programme called the Developing Countries Trading Scheme (DCTS) in the UK starting on June 19.
The removal of the duty benefit programmes is anticipated to have an effect on labor-intensive industries such leather goods, carpets, iron and steel products, chemicals, and some textile products.
India is eligible for the GSP benefit in the UK for exports of US$2.5 billion. The co-founder of the Global Trade Research Initiative (GTRI), Mr. Ajay Srivastava, stated: “Since the UK left the EU, it created its own GSP scheme. Each nation establishes a product-based threshold limit; if a nation’s exports exceed the threshold, the GSP concessions end. Given that the UK and the two nations are negotiating a free trade agreement, the withdrawal of GSP concessions on labor-intensive products was anticipated.
He told me that some industries, including metals, will continue to benefit from the duties.
India will profit from normal preferences rather than enhanced preferences, he declared. LDCs will receive improved perks.
In his opinion, India should quit taking part in GSP programmes because the incentives are so minimal. He believed that India ought to be as imposing as China. GSPs are relics of the colonial worldview, he continued, and should only be utilised by Least Developed Countries (LDCs).
