Trump poster being stepped on
© Reuters / Rupak De Chowdhuri
Slamming India for its refusal to provide American companies with unlimited access to its markets, President Trump has announced that New Delhi is set to lose its preferential trade status with the US next week.

"I have determined that India has not assured the United States that India will provide equitable and reasonable access to its markets," Trump said in a statement on Friday, announcing that India will be excluded from the Generalized System of Preferences (GSP) program on June 5.

Under GSP, India has been annually importing to the US some $5.6 billion worth of products duty-free. The program, designed for developing nations, especially facilitated the exports of textiles, leather, engineering goods, gems and jewelry.

The US-Indian tensions escalated last year when Washington slapped the country with 25 percent tariffs on steel and 10 percent levies on aluminum, all while seeking import trade concessions from New Delhi.

While India threatened tariff hikes on 29 American products, Prime Minister Narendra Modi's government decided to postpone the retaliatory measures pending negotiations. The American officials are seeking to reduce the US' $21-billion deficit with India, after Trump as usual accused the country of 'unfair' trade practices and refusal to buy more American products.