MJSA Supports Removal of Preferential Status for Certain Indian Jewelry

Rope Chain

Attleboro Falls, MA—Manufacturing Jewelers & Suppliers of America (MJSA) has announced its support for a recent government issuance removing preferential duty-free treatment for two types of jewelry necklaces from India. The decision was made during the Obama Administration’s annual review of the Generalized System of Preferences (GSP) program.

This comes as a win for the industry trade organization, which had earlier advocated for the removal of such preferential treatment, citing that it provided an unfair advantage for Indian imports and presented additional hardship on domestic manufacturers.

MSJA representatives had testified at hearings on the issue held by the Office of the United States Trade Representative (USTRO), which is part of the Executive Office of the President, as well as hearings before the United States International Trade Commission.

“Duty-free Indian imports of rope chain and mixed link necklaces climbed dramatically from 2006 through 2009, exceeding the competitive need limitations of the GSP,” said David W. Cochran, president and ceo of MJSA, during his government testimony. “The competition from these duty-free imports placed a severe burden on U.S.-based suppliers, who are already coping with a massive economic downturn.”

The overall growth of lower-priced imports has helped to put the entire U.S. jewelry industry under great strain in the past decade, Cochran added. MJSA has advocated that any country that no longer qualifies for GSP status should no longer receive duty-free treatment.

“While the U.S. jewelry manufacturing industry does not want to fall back on protectionist measures, it also does not want to see competitors receive an unfair cost advantage, said Cochran. “The elimination of India’s duty-free status for mixed link and rope chain helps to rectify this situation, and puts U.S. and Indian companies on a more even playing field.”

Waiver Revoked

The Trade Act of 1974 encompasses the GSP program, which allows the United States to import certain goods duty-free, thus helping developing countries. Once a country’s imports for a specific product rise above a set competitive-needs ceiling, they will have this duty-free status revoked, unless the President grants a competitive-need-limitation (CNL) waiver. India and its mixed link chains had been granted such a waiver.

This year, however, President Obama reviewed which products should continue to receive duty-free treatment under GSP. He determined that the two categories of necklaces from India–among other goods from three other countries–were sufficiently competitive in the country to end their preferential status.

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