The US intends to end special exchange status for India, under a plan which enables certain items to enter the US obligation free.
President Donald Trump said India had neglected to guarantee the US it would give sensible access to its business sectors.
India said the US move would have an "insignificant monetary effect".
The US will likewise end Turkey's special exchange status, saying it never again qualifies.
It is the most recent US endeavor to counter what it sees as uncalled for exchange rehearses. Mr Trump has swore to decrease US exchange shortages, and has over and again gotten out India for high levies.
Subsequently, he coordinated the US Trade Representative's (USTR) office to expel India from a program that gifts it special exchange treatment.
Particular exchange treatment for India right now permits $5.6bn (£4.3bn) worth of fares to enter the United States obligation free.
In a letter to Congress, the US president said India had "not guaranteed the United States that it will give evenhanded and sensible access to the business sectors of India".
'Special treatment'
b "certain items can enter the US obligation free if the recipient creating nation meets a lot of criteria set up by Congress".
The criteria incorporate giving licensed innovation assurance, and giving the US sensible and equitable access.
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India's Commerce Secretary Anup Wadhawan said the withdrawal from the GSP would have "insignificant monetary effect of $190m (£144m) on India".
"Our exchange relations stay genial with the US. There is no disturbance on exchange talks," Mr Wadhawan said.
'Things need to change'
Examination by Karishma Vaswani, Asia business journalist
India is the world's greatest recipient of America's GSP program, which was made during the 1970s to help creating and poor nations improve their financial development prospects.
At the time, India was checking in development rates of as low as 3.5%. This year it is suspected that it could shoot up to the world's fifth biggest economy, matching the UK.
Examiners state that is the reason the US, and specifically the Trump organization, is stating things need to change.
Nations that are never again creating countries shouldn't keep on inspiring uncommon access from the US to enable them to develop - particularly on the off chance that they're not giving corresponding access.
Exchange specialists additionally state there's a sense inside the Trump organization that on the off chance that they're following China dependent on its cases that it is as yet a creating nation, at that point it is deceptive not to do likewise with India, as well.
The US likewise plans to expel Turkey from its GSP program. It contends the nation never again meets the criteria since it is "adequately monetarily created".
The progressions may not produce results until somewhere around 60 days after the notices to Congress and the legislatures of India and Turkey.
Exchange war
The move is the most recent push by the Trump organization to change what it considers to be uncalled for exchanging associations with different nations.
That notion has fuelled a harming exchange war among Washington and Beijing. Dealings are continuous to determine the question that has seen the two sides force billions of dollars worth of levies on each other's merchandise.
The US has likewise forced duties on steel and aluminum imports from nations around the globe. A year ago, India struck back to those duty climbs by raising import obligations on a scope of merchandise.
The move to end US special status for India comes at a testing time for India's Prime Minister Narendra Modi as he gets ready to confront decisions this year.
