Chinese exports to India decline in 11 months of 2020

Source: The Economic Times, Dec 07, 2020

BEIJING: China’s exports to India declined by 13 per cent in the first 11 months of the year, while Indian exports to China rose 16 per cent in the same period, according to Chinese customs data released on Monday.

The bilateral trade in the first 11 months of 2020 touched USD 78 billion, amidst border tensions between the two countries in eastern Ladakh.

The two countries traded about USD 92.68 billion worth of goods in 2019.

According to customs data released on Monday, China exported about USD 59 billion worth of products to India from January to November, down 13 per cent, a report in the state-run Global Times said.

China’s imports from India stood at about USD 19 billion in the first 11 months, up 16 per cent.

India’s trade deficit stood at USD 40 billion from over USD 60 billion in the previous financial year.

Amidst border tensions, New Delhi has banned over 200 Chinese applications as they posed a threat to the “sovereignty and integrity of India”.

India and China have been locked in a military standoff along the Line of Actual Control (LAC) in eastern Ladakh since May this year.

Multiple rounds of talks between the two sides to resolve the standoff have not yielded any concrete outcome.

India bans AliExpress, 42 other Chinese apps over security concerns

Source: Business Standard, Nov 25, 2020

Bengaluru: In another blow to Chinese apps functioning in India, the government has banned 43 more apps in the country, including the popular online retail portal AliExpress, belonging to Jack Ma-owned e-commerce giant Alibaba Group.

The Ministry of Electronics and Information Technology (Meity) on Tuesday issued the order for blocking the access to these apps under Section 69A of the Information Technology Act.

“This action was taken based on the inputs regarding these apps for engaging in activities which are prejudicial to sovereignty and integrity of India, defence of India, security of state and public order,” it said in an official statement. The decision was taken based on the comprehensive reports received from Indian Cyber Crime Coordination Centre, Ministry of Home Affairs, Meity said.

Other popular apps on the list include Snack Video, a short video app which was gaining traction after the earlier ban on TikTok, and Alipay Cashier, which helped users collect payments from Alipay by scanning a QR Code. AliExpress and Snack Video have over a 100 million downloads each on Google Play Store. While shopping apps like Shien and Club Factory were blocked weeks ago, AliExpress had evaded the ban earlier. This time, over a dozen Chinese dating apps, including Chinese Social and We Date, have also been red-flagged by the country.

“This was due for a while now and even more could be in the pipeline. E-commerce, payments and online dating are the primarily targeted infrastructures that have access to quite a lot of critical consumer information. What needs to be seen is whether Indian alternatives can replace these existing platforms with profits rather than just replace them with a burn,” said Ankit Chaudhari, CEO & founder, Aiisma, a data marketplace.

Some industry players claimed that some of these apps were banned earlier as well but they cloaked themselves under a new identity to enter the Indian market again. “The ban is a very smart move and sends out a clear message that Chinese apps can’t use such tactics to engage in activities that are prejudicial to India’s sovereignty,” said Sumit Ghosh, CEO and co-founder of Chingari, which claims to have the highest engagement time in the short-form video space in India.

Experts say the biggest security concern is that a lot of apps on smartphones collect massive amounts of data which has nothing to do with the services they provide. “As the threat to secure user data is increasing, users must make sure their mobile phones are protected, secured and encrypted,” said Aditya Narang, co-founder & managing director, SafeHouse Technologies, a cyber security tech enterprise. Overall, the government has banned 220 apps since June amid continuing tensions along the India-Chinese border. These include PUBG, WeChat and Alipay. After being banned for over two months in India, the creators of PUBG are preparing to launch PUBG Mobile India, a mobile version of the popular game, to cater to the India market. According to reports, PUBG Corp has registered an Indian subsidiary in Bengaluru indicating a relaunch in the country soon.

India’s trade deficit with China reduces to $48.66 bn in FY’20

Source: Business Standard, Jul 02, 2020

New Delhi: India’s trade deficit with China fell to $48.66 billion in 2019-20 on account of decline in imports from the neighbouring country, according to government data.

Exports to China in the last financial year stood at $16.6 billion, while imports aggregated at $65.26 billion, the data showed.

The trade deficit between the countries was at $53.56 billion in 2018-19 and $63 billion in 2017-18.

The main imports from China include clocks and watches, musical instruments, toys, sports goods, furniture, mattresses, plastics, electrical machinery, electronic equipment, chemicals, iron and steel items, fertilisers, mineral fuel and metals.

New Delhi has time and again raised concerns over widening trade deficit with China.

The government is taking steps such as framing technical regulations and quality norms for several products to cut dependence on China for imports.

It has also imposed anti-dumping duties on several goods, which are being dumped in the domestic market at below the average prices from China with a view to guard domestic players from cheap imports.

Technical regulations

As many as 371 products have been identified for technical regulations. Out of these, technical regulations have been formulated for 150 products worth about $47 billion of imports.

Over 50 quality control orders (QCOs) and other technical regulations have been notified in the past one year including on electronic goods, toys, air conditioners, bicycle parts, chemicals, safety glass, pressure cooker, items of steel, electrical items such as cables.

China accounts for about 14 per cent of India’s imports and is a major supplier for sectors such as mobile phones, telecom, power, plastic toys, and critical pharma ingredients.

Similarly, foreign direct investment (FDI) from China into India too has dipped to $163.78 million in 2019-20 from $229 million in the previous fiscal, according to the data.

India had received $350.22 million FDI from the neighbouring country in 2017-18 and $277.25 million in 2016-17.

During April 2000 and March 2020, India attracted FDI worth $2.38 billion from China.

In April, the government tightened FDI norms coming from the countries which share land border with India. As per the amended FDI policy, a company or an individual from a country that shares land border with India can invest in any sector only after getting government approval.

Top sectors which saw maximum FDI from China during April 2000-March 2020, are automobile ($987.35 million), metallurgical ($199.28 million), electrical equipment ( $185.33 million), services ( $170.18 million), and electronics ( $151.56 million).

India’s trade deficit with China at 5-year low

Source: The Economic Times, Jun 23, 2020

NEW DELHI: India’s trade deficit with China is estimated to have narrowed to $48.7 billion during the last financial year — the lowest in five years — compared with $53.6 billion a year ago, as imports from across the border dropped over 7% to $65 billion in 2019-20.

Last year’s trade deficit was roughly the same as the level seen in 2014-15, when the Narendra Modi administration first took office, but 34% higher than 2013-14, prompting the government to suggest that the steps taken by it in recent months have yielded results.

“It is not as if we are taking steps to reduce imports and reduce the trade gap now. We have been working on strategies for the past several months and going forward the results will be better,” said a source.

Commerce department officials said that the move to opt out of Regional Comprehensive Economic Partnership (RECEP) agreement, the proposed mega free trade agreement, will help it bridge the deficit with other steps such as faster trade remedies against subsidised or dumped goods too coming to the rescue of Indian industry. The fall in imports from China also helped the US extend its lead as India’s largest trading partner. Against trade of $88.8 billion with the US, India’s trade with China was pegged at just under $82 billion.

FDI policy does not restrict market access: Officials

Source: The Economic Times, Apr 22, 2020

New Delhi: Refuting China’s accusation that India’s revised foreign direct investment (FDI) policy is discriminatory, officials have said that the revision neither restricts market access nor national treatment— the two tenets of global trade-—and is not violative of any rules of the World Trade Organization (WTO).

India, on Saturday, made its prior approval mandatory for direct or indirect foreign investments from countries that share a land border with it to curb “opportunistic takeovers” of domestic firms following the Covid-19 pandemic, a move which will restrict FDI from China.

Terming this move “discriminatory”, China on Monday said these “additional barriers… violate WTO’s principle of nondiscrimination, and go against the general trend of liberalisation and facilitation of trade and investment”.

Officials have rejected China’s claims on all the three counts of goods, services and investment.

Dismissing the claim on General Agreement on Tariffs and Trade (GATT) count, the official said the new norms do not directly affect goods, and also ruled out any link with the General Agreement on Trade in Services (GATS), explaining that the revised policy is not related to market access or national treatment restriction.
“This does not automatically result in any equity cap or restriction. Only a formally different procedure is prescribed,” the official added. The principle of national treatment prohibits discrimination between imported and domestically produced goods and services with respect to internal taxation or other government regulation.

Market access for goods means the conditions, tariff and non-tariff measures agreed by members for the entry of specific goods into their markets.

On the investment front, the measure does not fall within the Illustrative List of the Agreement on Trade-Related Investment Measures (TRIMS), which details the measures that are inconsistent with the obligation of national treatment. “There is no WTO concern,” the official said.

Similarly, since India-China and India-Nepal Bilateral Investment Treaties (BIT) have been terminated, they only apply to investment already made into India prior to the termination.

Therefore, to the extent no retrospective action is taken to negate existing investments, there is no violation of the respective BITs. Incidentally, India is not only country to have tightened its FDI policies.

While Australia has said all foreign investment proposals will be assessed by a review board during the coronavirus crisis to prevent a sale of distressed corporate assets, Germany too has reportedly made the policy stricter to protect its companies.

India, China sign intel sharing pact

Source: The Economic Times, Oct 22, 2018

NEW DELHI: India and China on Monday signed their maiden internal security cooperation agreement that among other areas of cooperation will involve intelligence sharing between two sides amid common threats from international terror.

The pact is expected to set up mechanism for cooperation between internal security establishments of the two countries for the first time. The pact is being signed during visit of Zhao Kezhi, China’s Minister of Public Security beginning Monday.

Kezhi held meetings with Home Minister Rajnath Singh during which they will discuss various aspects of security cooperation between the two countries, sources informed. Read the rest of this entry »

China to reduce tariffs on 8,549 types of goods from India, 4 other Asian countries

Source: The Economic Times, Jun 28, 2018

NEW DELHI: China plans to reduce tariffs on more than 8,500 goods, including chemicals, farm products and metals from India and some other Asian countries in what is seen as a part of its ongoing trade war with the US.

“China will reduce or cancel tariffs on imports of 8,549 types of goods from India, South Korea, Bangladesh, Laos & Sri Lanka,” China’s ambassador to India Luo Zhaohui tweeted on Wednesday. “The goods include chemicals, agricultural & medical products, soyabean, clothing, steel & aluminium products. Good news to help reduce trade imbalance.” Read the rest of this entry »

How Chinese companies are beating India in its own trade backyard

download (6).jpgSource: The Economic Times, Dec 13, 2017

In just 10 years, China has built world-class MNCs that have graduated from making cheap copycats of western products to competing with world’s biggest MNCs. And now India is in their cross hairs. Indian companies have a reason to be afraid because they are not going to match the Chinese manufacturers who ride on aggressive pricing, state subsidy, protectionist policies and cheap finance. download (7)

Take smartphone-maker Xiaomi. Once considered a cheap copycat, it is now emerging as a leader in India. It plans to diversify into high-margin products such as electric vehicles and fast-track segments such as payment banking. Recently, it made a regulatory filing in India, stating its future game plan.

Given its runaway success in smartphones in a very short period, it can dominate auto and consumer goods segments in coming years.
Read the rest of this entry »

China downgrade shows emerging market ratings stuck in reverse

index.jpgSource : Economic Times 26 May 2017

LONDON: A Moody’s downgrade on China on Wednesday and the likelihood that Brazil and South Africa face further rating cuts in the coming months is highlighting how emerging market credit quality remains stuck in reverse. Since the start of 2014, Reuters analysis shows that the big three rating agencies – S&P Global, Moody’s and Fitch – have racked up more than 150 emerging market downgrades between them.

That averages out a roughly one a week and though there have been hopes that rising global growth and commodity prices will ease the pressure, that does not seem to be occurring yet.

Read the rest of this entry »

India’s refusal to join China’s One Belt and One Road initiative regrettable: Chinese media

Source : Financial Express 15 May 2016

India’s refusal to join China’s high-profile Belt and Road initiative is “regrettable” but New Delhi’s boycott will not at all affect the cooperation in infrastructure development among its neighbouring countries, a report in a state-run newspaper said today.

The two-day Belt and Road Forum which is being attended by leaders from 29 countries, including Pakistan, has been boycotted by India due to sovereignty concerns over the USD 50 billion CPEC (China-Pakistan Economic Corridor), which passes through Pakistan-occupied Kashmir.

“While India recently issued an official statement saying it would not be part of the “One Belt and One Road” (B&R) initiative, it will not affect the trend towards cooperation in infrastructure development among its neighbouring countries at all,” Global Times reported today.

“India was openly sceptical of China’s Belt and Road Forum (BRF) hours ahead of the opening of the event, mainly due to concerns over the China-Pakistan Economic Corridor (CPEC), a key project of the B&R, and whether it might influence the disputed Kashmir region,” it said.