As per industry reports, two members from the US House of Representatives, Charles B. Rangel and Sander M. Levin, have written a letter to the US trade representative, Susan Schwab, arguing that revoking duty exemptions on gems and jewellery from India and Thailand under the Generalized System of Preferences (GSP) program was not justified.

They said the move to withdraw India’s benefits would help China consolidate its position and may harm India’s interests.

Indian jewellery exports to the US would be subject to a 6.7 per cent duty, after the GSP scheme lapses on June 30. Exporters are seeking an extension of the scheme until the end of next year.

The congressmen said the duty-free benefits should not be withdrawn without ensuring the competitiveness of the affected beneficiary country, and that it worked to the benefit of a lesser developed GSP country.

Last month, Schwab pointed out that India was not longer eligible under the GSP program as its jewellery exports to the US had crossed $2 billion in 2006, well above the $1.87 billion annual cap.