TRADE UPDATE #60

A Failed Trade-Off?

28/02/2020

Since the beginning of this year, India was looking forward to President Donald Trump’s visit. From a rally at a cricket stadium that holds 110,000 people in Ahmedabad to a trip to the Taj Mahal, the Indian government pulled out all stops for POTUS and his family. The reason behind this facade? A trade agreement, which is now more or less shelved. Now that the US state visit has finally ended with no promises met, it's time for India to refocus on slacking exports and the slowing economy, among other issues.

Meanwhile, as Brexit is now a reality, Indian companies operating out of the UK need to look at alternate countries to cater to the European market. Among such nations is Ireland, which is promoting itself as an alternative to the UK, as an EU member and with free-market access to the region. It would be good to see how India-Ireland can take advantage of Brexit to strengthen their mutual relationship.

In other news, coronavirus continues to haunt the world with 83,000 cases of COVID-19 now confirmed in 52 countries. The damage is not limited to human lives anymore as Oxford Economics warns that the outbreak could potentially knock off 1.3% of global growth this year.


INTERNATIONAL TRADE

Ireland an alternative to UK for Indian firms eyeing EU base: Irish envoy

“The Irish and the English common law are pretty much the same as here in India. We are one time zone closer to the American east coast in the way the UK is and of course, we have all the advantages of being a member state of the EU and completely free access to the European market,” Ward said. “We have, in general, a business-friendly environment and a very business-friendly government. We are promoting all of these aspects with a view to developing relations,” he added.


COMMODITY

Fish exports: Fears prompt awareness drive

Aiming to sustain Indian fish exports to the US, the European Union (EU), China and Japan, the Marine Products Export Development Authority (MPEDA) and the National Fisheries Development Board (NFDB), Hyderabad is taking up initiatives to spread awareness among aquaculture farmers. The move comes in the wake of zero-tolerance policies towards antibiotic residues in cultured shrimps by the US and the EU. “In an attempt to improve fish exports, as part of the Blue Revolution, we are working on strict implementation of the norms to stop overdose of antibiotics,” said a senior executive at NFDB.


BILATERAL TRADE

Trump flags 'highest' India tariffs; trade deal in works

Flagging high duties, US President Donald Trump in New Delhi on 25th February said India imposed the highest tariffs on US products and cited the case of Harley-Davidson bikes. “We are being charged a large amount of tariffs. I think you have to pay the highest tariff when you deal with India. Harley-Davidson has to pay tremendous tariffs when they send motorcycles here. When India sends to us, there is virtually no tariff. For the most part, there is absolutely no tariff. I just said that’s unfair and we are working it out,” the US President said at the solo press conference at the fag end of his two-day India visit.


BILATERAL TRADE

India Inc hails Trump's visit; hopes to raise India-US economic engagement

India Inc on 25th February said that trade and investment relations between India and the US have received a major boost with the visit of President Donald Trump. Industry body Assocham’s Secretary General Deepak Sood said the two-way engagement of about $160 billion can be doubled within the next 4-5 years. “With a rising economy and aspiration of 1.3 billion people, India has emerged as a key and strategic partner for the US even as the US remains the most important and promising destination for Indian exports of goods and services. President Trump aptly described India as a ‘tremendous market’,” Sood said.


COMMODITY

Yarn exports down by 20% due to corona virus impact

Coronavirus has brought down the yarn exports to China to almost nil. The country, which imports over a quarter (27%) of India’s cotton yarn, appears shut for yarn business. Exporters said that February, so far, has seen a 20%-30% drop in overall exports because of the inactivity in China. “Compared to January, there is a 40% drop in overall exports and almost nil exports to China. However, there is demand from Bangladesh and Vietnam who usually import yarn from China. So the situation has been salvaged a bit,” said Arjun Jhajaria, Director of Salona Cotspin.


OTHER NEWS

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