U.S. revokes India's gold jewellery GSP benefits

The United States is revoking its trade benefits on gold jewellery imports from India and Thailand following an annual review of the Generalized System of Preferences (GSP), a program that provides duty-free entry to nearly 5,000 products from 131 developing countries.

The government determined that 21 products from beneficiary countries, valued at approximately $4.8 billion last year, can compete effectively in the US market and will no longer be eligible for duty-free treatment under the GSP program. Gold jewellery imports from India and Thailand were part of that list and will now be subject to US import duties.

The GSP program includes two “competitive need limitations” on the eligibility of a product: (i) if the annual trade of a product from a specific country exceeds a value-based threshold ($125 million in 2006), or (ii) if the annual trade of a product from a specific country exceeds 50 per cent of total U.S. imports of that product.

Last year, India’s gold jewellery exports to the US under the GSP totalled $2.21 billion, while Thailand shipped gold jewellery worth $700.36 million, representing 33.2 per cent and 10.5 per cent, respectively, of total US gold jewellery imports in the same period, states the U.S. Trade Representative's office.

In 2006, the US extended duty-free treatment under the GSP program to imports worth $32.6 billion from eligible beneficiary countries, an increase of 22 per cent over 2005.