A blow to Modi and India

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The Trump administration is now targeting India and Turkey on trade issues. The U.S. Trade Representative's office says it intends to scrap the preferential trade status granted to both nations.

The office said in a statement on Monday that India has failed to provide assurances that it will allow "equitable and reasonable access to its markets," while Turkey is "sufficiently economically developed" and no longer qualifies.

The program allowed some exports to enter the U.S. duty free. And the new measure would not take effect for at least 60 days after notifications to Congress, and to the Indian and Turkish governments.

The new measures would affect over five billion U.S. dollars' of Indian exports to the U.S., and Indian exporters may suffer.

Indian Prime Minister Narendra Modi / VCG Photo

The U.S. has already slapped tariffs on Indian steel and aluminum. In the opinion of Einar Tangen, current affairs commentator, there couldn't be a worse time for Indian Prime Minister Narendra Modi, whose Hindu nationalist ruling party is preparing for the 2019 general elections in the next couple of months.

In Tangen's opinion, the Indian Prime Minister has been emphasizing his ability to get along with world leaders and having a special relationship with U.S. President Donald Trump, while USTR's action is going to undercut that.

In terms of economy, Tangen said India is not a big import and export country, and does run a deficit. Thus it's odd for the U.S. decision to end preferential trade status.

While in terms of U.S.-India cooperation in the Indo-Pacific region, Tangen said this is a very strong statement. It seems to suggest that when finished with China, the U.S. will then deal with India.