{"id":25238,"date":"2024-06-01T17:45:05","date_gmt":"2024-06-01T12:15:05","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=25238"},"modified":"2024-06-01T22:49:53","modified_gmt":"2024-06-01T17:19:53","slug":"us-china-trade-war-could-help-and-hurt-india","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/editorial-analysis\/01-06-2024\/us-china-trade-war-could-help-and-hurt-india","title":{"rendered":"US-China trade war could help and hurt India"},"content":{"rendered":"\n<p><strong>Syllabus : GS 2\/IR<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-7876fd66c7e9ffc5b049ab5a8df88a33\" style=\"color:#015aa7\"><strong>In News<\/strong><\/h2>\n\n\n\n<p>US President has directed his Trade Representative to increase tariffs on USD 18 billion of imports from China to &#8216;protect&#8217; American workers and businesses<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-2b7e93d8f3f5d51550e5a2b77a012661\" style=\"color:#015aa7\"><strong>US stand&nbsp;<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>It has proposed sharp increases in tariffs on certain steel and aluminium products, semiconductors, electric vehicles, lithium-ion batteries, solar cells, ship-to-shore cranes and medical consumables.\n<ul class=\"wp-block-list\">\n<li>The proposed increases are a part of the US&#8217;s broader strategy under <strong>Section 301 of the Trade Act of 1974.<\/strong><\/li>\n<\/ul>\n<\/li>\n\n\n\n<li>The reasons cited by the US include <strong>China\u2019s unfair practice<\/strong>s relating to <strong>technology transfer<\/strong>, <strong>intellectual property<\/strong> and <strong>innovation <\/strong>and the threats posed by large manufacturing capacities.<\/li>\n\n\n\n<li>China is also flooding global markets with artificially low-priced exports.&nbsp;<\/li>\n\n\n\n<li>All these impact the American businesses and workers negatively .<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-7d2f50b1ee674f9e349688ba7f5d9af0\" style=\"color:#015aa7\"><strong>China\u2019s Response&nbsp;<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Chinese officials have fiercely promised to retaliate, stressing that this will seriously affect bilateral cooperation with the US.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-a9a78581435c0a7d985c5ae530f660fa\" style=\"color:#015aa7\"><strong>Impact on Global Economy&nbsp;<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The trade war between the U.S. and China could hurt the economic prospects across the developing countries .&nbsp;<\/li>\n\n\n\n<li>The trade war can have a direct impact on consumer products.<\/li>\n\n\n\n<li>The companies may find it difficult to operate with huge taxes and in response to that these will increase their product prices which will put a burden on consumers when they buy any products<\/li>\n\n\n\n<li>A trade war could weaken investment, depress spending, unsettle financial markets and slow the global economy.&nbsp;<\/li>\n\n\n\n<li>It could also result in other countries raising protectionist barriers.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-2ac6e50f2780574ee523fe6e6b13ae27\" style=\"color:#015aa7\"><strong>Repercussions for India&nbsp;<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>the positives<\/strong> : Indian exporters need to make the most of opportunities created by the trade war.\n<ul class=\"wp-block-list\">\n<li>Exporters of face masks, syringes and needles, medical gloves and natural graphite are the best places to benefit from the recent round of tariff hikes by the US.&nbsp;<\/li>\n\n\n\n<li>While China is the biggest exporter to the US in these categories, India too has a good presence in the US in these products.<\/li>\n\n\n\n<li>The United States and China are major trade partners of India in international business and can fulfill the huge gap of trade deficit through export.<\/li>\n\n\n\n<li>India can seek more opportunities in the enhancement of information and communication technology, eCommerce, the chemical industry, outsourcing, and the automotive sector.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Negatives&nbsp;<\/strong>\n<ul class=\"wp-block-list\">\n<li>Indian authorities need to up the ante in checking dumping of low-priced Chinese goods diverted into India, which can negatively impact Indian manufacturing.&nbsp;<\/li>\n\n\n\n<li>With the EU contemplating increasing duties on EV imports from China, there is risk of the latter pushing cheap EVs into India, deterring Indian businesses.&nbsp;<\/li>\n\n\n\n<li>Products slapped with higher US duties such as lithium ion batteries and semiconductors from China could also be diverted to India.\n<ul class=\"wp-block-list\">\n<li>China is already India\u2019s biggest trading partner, with India\u2019s imports from that country totalling $101.7 billion in FY24.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-992a78cc340dde96b4793263b42e387a\" style=\"color:#015aa7\"><strong>Safeguards Available in India&nbsp;<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>India has a process for identifying imports which are priced lower than the selling price in the country of origin with the<strong> Directorate General of Trade Remedies levying anti-dumping duty on such products.<\/strong>\n<ul class=\"wp-block-list\">\n<li>But there is delay in accessing and analysing the trade data and taking action.&nbsp;<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-e2418cc5398a3a7f2d9236aad7d7492c\" style=\"color:#015aa7\"><strong>Conclusion and Way Forward&nbsp;<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A recent announcement by the US of an increase in tariffs on a range of imports from China&nbsp; could have repercussions on global trade&nbsp;<\/li>\n\n\n\n<li>Therefore the commerce ministry&#8217;s investigation arm Directorate General of Trade Remedies (DGTR) has to remain vigilant<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The Centre could consider setting up a department to analyse the trade data on some key imports daily so that action can be expedited.&nbsp;<\/li>\n\n\n\n<li>A trade policy with China that bolsters rather than impairs India\u2019s recent manufacturing boost deserves attention \u2014 especially given India\u2019s keenness to be a \u2018China plus one\u2019 hub.<\/li>\n<\/ul>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-background\" style=\"background-color:#ebecf0\"><tbody><tr><td><strong>Mains Practice Question&nbsp;<\/strong><br><strong>[Q]<\/strong> How will a US-China trade war affect&nbsp; global trade?Does a US-China trade war give India a window of opportunity?&nbsp;<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/www.nextias.com\/ca\/wp-content\/uploads\/2024\/06\/Daily-Editorial-Analysis-01-06-2024.pdf\">Download PDF<\/a><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>US President has directed his Trade Representative to increase tariffs on USD 18 billion of imports from China to &#8216;protect&#8217; American workers and businesses<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[22],"tags":[],"class_list":["post-25238","post","type-post","status-publish","format-standard","hentry","category-editorial-analysis"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/25238","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=25238"}],"version-history":[{"count":5,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/25238\/revisions"}],"predecessor-version":[{"id":25260,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/25238\/revisions\/25260"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=25238"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=25238"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=25238"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}