US scrapping preferential trade status ‘double whammy’ for India, PM Modi should give statement: Congress

The Congress on Saturday said the US government's decision to terminate special trade status for India will have adverse consequences on exports and urged Prime Minister Narendra Modi to take the country into confidence and make a comprehensive statement explaining how he intends to overcome this "grave trade and economic crisis".

Addressing a press conference, Congress chief spokesperson Randeep Surjewala said it is a "double whammy" for India which has "succumbed to US pressure" of not buying crude oil from Iran and has also lost the special trade status and alleged that the government did "nothing to preempt it" despite being informed of the decision in March.

"On behalf of the people of India, we urge upon Prime Minister Narendra Modi to make a comprehensive statement on the issue to the nation and place before the public a way forward to overcome this grave trade and economic crisis," he told reporters.

"The Prime Minister should take the nation into confidence," he also said.

The Congress leader also urged the Modi government to withdraw the hike in LPG prices for both subsidised and non-subsidised category which it has "gifted" to the people soon after coming back to power.

The LPG prices have risen by ₹323.5 per cylinder for non-subsidised category and ₹85.37 for subsidised category in the last five years, he alleged.

"We urge the Prime Minister to take back this increase in LPG price rise," he said, adding that women of the country will be badly affected by the price hike.

Surjewala said on one hand the Indian Government has decided to yield to pressure and stop purchasing crude oil of 23.5 million tonnes annually from Iran at favourable terms, on the other hand, 'special trade status' for India has been withdrawn by the country to whom its export volume is the largest.

"What is of more concern is the fact that the withdrawal of 'special trade status' was notified to India on March 4, 2019 itself. Yet the Government did nothing to preempt it. The most serious implication would be for sectors like Agriculture, Auto Parts, Pharmaceutical etc. which are already facing serious crisis," he said.

The Congress leader said in future, India could see many more industries, including the services industry which has more than $28 billion under exports to the US being affected significantly.

He said a decline in exports to the the United States which is India's largest partner will worsen the job crisis.

"Already, unemployment is at a five-year high of 6.1% (NSSO) and GDP growth has slumped to a five year low at 5.8%. At this juncture, withdrawal of the special trade status by the US is a double whammy," he said.

He said the United States' proclamation terminating the status of India as 'beneficiary developing country' or 'special trade status' with effect from June 5, 2019 has grave trade and economic implications for India, as it directly affects India's exports worth $54.4 billion (₹3,80,000 crores).

Surjewala recalled that it is after 44 years that this status is being taken back, as it was on November 24, 1975 when Indira Gandhi was Prime Minister that this was granted to India.

On the unemployment figures, the Congress leader said the NSSO data was earlier held back by the government but confirms that the job crisis in the country is grave.

"It cannot be subject matter of a slanging match between two political parties. India's young need jobs. India's young are unemployed. India's young are facing the worst unemployment crisis in last 45 years.

"So, bereft of the niceties, all these technicalities, the responsibility and the onus lies on the current Government to address the job crisis as its first priority," he said.

"We will request the Prime Minister to look at the job crisis as a priority number one for the nation and we will support any steps taken in this direction by the Prime Minister, for this positively and in a concrete fashion.

"We sincerely hope that a Prime Minister, who has been elected with such a huge mandate, is listening to the cry for justice of the young in this country," he said.

The US President has terminated India's designation as a beneficiary developing nation under the key GSP trade programme, with the proclamation stating that New delhi has not assured the US that it will provide "equitable and reasonable access to its markets." The Generalized System of Preference (GSP) is the largest and oldest US trade preference programme and is designed to promote economic development by allowing duty-free entry for thousands of products from designated beneficiary countries.

"I have determined that India has not assured the US that it will provide equitable and reasonable access to its markets. Accordingly, it is appropriate to terminate India's designation as a beneficiary developing country effective June 5, 2019," President Donald Trump said in a proclamation on Friday ignoring a plea by several top American lawmakers.