Trump’s move will have a limited impact thus does not warrant a “knee-jerk reaction,” top Indian trade official, Anup Wadhawan, was quoted by Reuters as saying on Tuesday, just hours after the United States announced its intention to “terminate” India’s designation as a GSP beneficiary.

The US has been pressuring India to reduce duties in the information technology sector, the official said, noting that negotiations continue on a bilateral trade package that would address both sides’ concerns.

Trump has justified his move by accusing India of failing to provide the US with enough access to its markets. “India has implemented a wide array of trade barriers that create serious negative effects on United States commerce,” the US Trade Representative's Office (USTR) said in a statement. “Despite intensive engagement, India has failed to take the necessary steps to meet the GSP criterion.”

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