Washington: India has expressed disappointment at United States' decision to end the country's preferential trade status despite offer of a "resolution on significant US requests to find a mutually acceptable way forward".
In a statement, the Commerce Ministry said, "In any relationship, particularly in the area of economic ties, there are issues which get resolved mutually time to time. We view this issue as a part of regular and will continue to build on our strong ties with the US, both economic and people to people."
It added that India viewed the issue as part of its ongoing economic relationship with the US and "will continue to build on our strong ties with the US, both economic and people-to-people".
"We are confident that the two nations will continue to work together intensively for further growing these ties in a mutually beneficial manner," it added.
President Donald Trump on Friday said that the US would end its preferential trade treatment for India on June 5. Trump had announced his intention to remove India from the Generalized System of Preferences (GSP) programme in early March.
"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," Trump said on Friday, ignoring the plea made by several top American lawmakers as it will cost American businesses over $300 million in additional tariffs every year.
On March 4, Trump announced that the US intends to terminate India's designations as a beneficiary developing country under the GSP programme. The 60-day notice period ended on May 3.
The opposition Congress said the US government's decision will have adverse consequences on exports and urged Prime Minister Narendra Modi to take the country into confidence and make a comprehensive statement and explain how he intends to overcome this "grave trade and economic crisis".
Congress chief spokesperson Randeep Surjewala described the move as 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. He claimed that the government did "nothing to preempt it" despite being informed of the decision in March.
The Trump administration has prioritised working with the Government of India to ensure that US companies have a level-playing field, a senior State Department official told reporters on Thursday, hours after Narendra Modi was sworn in as Prime Minister for a second time following his spectacular electoral victory in the general elections.
Under the GSP programme, nearly 2,000 products including auto components and textile materials can enter the US duty-free if the beneficiary developing countries meet the eligibility criteria established by Congress.
India was the largest beneficiary of the programme in 2017 with USD 5.7 billion in imports to the US given duty-free status and Turkey the fifth largest with USD 1.7 billion in covered imports, according to a Congressional Research Service report issued in January.
Meanwhile, the dow fell more than 350 points after Trump threatened new tariffs on Mexico. The European markets also closed in the red after Trump stoked recession fears.