Hours after he took over as the external affairs minister in the new Narendra Modi government, former diplomat S. Jaishankar had a situation on hand. US President Donald Trump formally rescinded India’s designation as a beneficiary developing country under the Generalized System of Preferences (GSP).

This designation, accorded to India in November 1975, provided preferential duty-free access to the US markets for an array of goods. It is the clearest expression yet of Trump’s intention to confront economic differences, especially bilateral trade deficit, with India head on — irrespective of its implications for the wider US-India relationship. While Jaishankar is no stranger to these issues, the context in which he will have to deal with them is more challenging than ever.

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