To ease economic restrictions on China, India is being examined at the highest levels, with any relaxation tied to reciprocal and calibrated steps from Beijing. The discussions are taking place against the backdrop of a rapidly changing global trade environment and the risk of more severe US tariffs.&nbsp;Officials indicated that the approach being considered would be incremental rather than broad-based. India has already simplified the process of granting business visas to Chinese workers and is now reviewing whether some investment-related restrictions could also be eased.&nbsp;“It (easing of norms for China) is being worked upon. It will take time, though. There has to be reciprocity. Earlier, flights were restored, visas were given, and entry norms were eased as we had to allow technicians for stalled projects, etc. So it will happen gradually,” an official said, the Indian Express reported.&nbsp;Considerable groundwork has already been done. A high-level panel led by NITI Aayog member Rajiv Gauba had earlier proposed lifting restrictions on Chinese investments. In addition, the Economic Survey 2023-24 argued for attracting Chinese capital to boost India’s export competitiveness.<h3>Stricter rules on Chinese investments</h3>India imposed stricter rules on Chinese investments in April 2020 through Press Note 3, requiring government approval for investments from countries sharing land borders with India. The measure was introduced to prevent opportunistic takeovers during the Covid-19 pandemic and has remained in place amid heightened security concerns following the Galwan clash later that year.&nbsp;To stabilise the broader relationship, a similar diplomatic approach was also adopted. This includes resumption of the Kailash Mansarovar Yatra; restoration of direct flights; issuance of visas for journalists and think-tank researchers, and the sharing of trans-border river data. Following the development, India responded that both sides had “reviewed the state of India-China bilateral relations comprehensively” and decided on “people-centric steps” aimed at stabilising and rebuilding ties.

India has already simplified the process of granting business visas to Chinese workers and is now reviewing whether some investment-related restrictions could also be eased.

To ease economic restrictions on China, India is being examined at the highest levels, with any relaxation tied to reciprocal and calibrated steps from Beijing. The discussions are taking place against the backdrop of a rapidly changing global trade environment and the risk of more severe US tariffs. Officials indicated that the approach being considered would be incremental rather than broad-based. India has already simplified the process of granting business visas to Chinese workers and is now reviewing whether some investment-related restrictions could also be eased. “It (easing of norms for China) is being worked upon. It will take time, though. There has to be reciprocity. Earlier, flights were restored, visas were given, and entry norms were eased as we had to allow technicians for stalled projects, etc. So it will happen gradually,” an official said, the Indian Express reported. Considerable groundwork has already been done. A high-level panel led by NITI Aayog member Rajiv Gauba had earlier proposed lifting restrictions on Chinese investments. In addition, the Economic Survey 2023-24 argued for attracting Chinese capital to boost India’s export competitiveness. Stricter rules on Chinese investments India imposed stricter rules on Chinese investments in April 2020 through Press Note 3, requiring government approval for investments from countries sharing land borders with India. The measure was introduced to prevent opportunistic takeovers during the Covid-19 pandemic and has remained in place amid heightened security concerns following the Galwan clash later that year. To stabilise the broader relationship, a similar diplomatic approach was also adopted. This includes resumption of the Kailash Mansarovar Yatra; restoration of direct flights; issuance of visas for journalists and think-tank researchers, and the sharing of trans-border river data. Following the development, India responded that both sides had “reviewed the state of India-China bilateral relations comprehensively” and decided on “people-centric steps” aimed at stabilising and rebuilding ties.

India has already simplified the process of granting business visas to Chinese workers and is now reviewing whether some investment-related restrictions could also be eased.

Economic reset? India examines step-by-step relaxation in trade with China

A modern, comprehensive and mutually beneficial economic partnership agreement for an open trade and investment milieu in the Asia-Pacific region is the core objective of the Regional Comprehensive Economic Partnership (RCEP). &nbsp;

Countries, in diverse stages of development, from Australia, China, Japan and India to the 10 members of the Association of South East Nations (ASEAN) are part of the RCEP, besides South Korea and New Zealand.&nbsp;

Once wrapped up, RCEP would foster the largest regional trading bloc, making up 25 per cent of global GDP, 30 per cent of world trade and 26 per cent of cross-country foreign direct investment (FDI) flows the world over.

While 'substantial progress’ has been claimed by India in negotiations in 2018, a closer look is needed. So far, as many as seven chapters in RCEP encompassing economic and technical cooperation, amongst others, have been concluded. But the crucial one on market negotiations bristle with Indian reservations, as it is not prepared to let its domestic industry smothered by the deluge of cheap goods from the other members, particularly China.&nbsp;

Interestingly, the erstwhile tiger economies of ASEAN want India to eliminate tariffs or customs duties on about 90-92 per cent items that it trades with the countries with which India has a Free Trade Agreement (FTA). These include ASEAN and Japan.&nbsp;

With the non-FTA partners—Australia, New Zealand and China, discussions are on for removing duties on 80 per cent of traded products. New Delhi has asked for a 20-year deadline to end the duties, but with China, it seeks more time for removal of tariffs. &nbsp;

The need for seeking a protracted liberalisation phase with China is based on ground realities. A House Panel report on the impact of Chinese goods on Indian industry, tabled in the monsoon session of Parliament, vehemently argued that “the impact of Chinese imports has been such that India is threatened to become a country of importers and traders with domestic factories either cutting down their production or shutting down completely…”

From raw material to components to final product assembly, the competitive strength of the Middle Kingdom is proven beyond a pale of doubt and that too across several sectors in which the competitive strength of Indian products are ironically, at a disadvantage.

According to the report, the annual year-on-year growth in Chinese imports was about 9 per cent in 2013-14, which had soared to 20 per cent in 2017-18. The trade deficit with China at $63 billion constitutes more than 40 per cent of India’s aggregate trade deficit.&nbsp;

The Chinese goods itself constitute about one-sixth of all imports in terms of quantum in India. In the decade 2007-08 to 2017-18, there has been an increase in India’s exports to China by $2.5 billion only while its imports from China have zoomed by $50 billion during this period. &nbsp; &nbsp; &nbsp;

With sobering statistics such as these, Indian trade envoys are naturally demanding that China should give more and we, in turn, would give China lower concessions and take a longer staging period, given the gargantuan trade deficit with Beijing.

As the core of the marathon talks zero in on market access for goods, services and investment with the deadline deferred to 2019, India might have earned a reprieve from immediate danger to its cocooned domestic sectors.&nbsp;

But as 2019 is an election year in India, the outcome of which will determine whether the proposed RCEP would be wrapped up by the incumbent dispensation or a new one, the fact remains that India must perforce have to undertake structural reforms, including correction of the much-delayed inverted duty structure, liberalisation of the mining sector to spur domestic manufacturing and markedly cut down import of steel, coal, oil and a plethora of other minerals.&nbsp;

The urgent need to be in a mega trading bloc is nowhere crucial than at this juncture when the World Trade Organisation (WTO), is faced with an existential crisis.&nbsp;

The numerous multilateral trade deals under its charge have come to a halt over the past decade. A slew of few trading nations have naturally pitched for regional or preferential free trade agreements (FTAs) among compact number of participants to exchange concessions and move ahead with gains accruing from such liberalised trade.&nbsp;

For India, which has not been in any meaningful regional trading arrangement, but attempted to latch on to a few FTAs that had only brought resentment from local industries, the enduring benefits of trade remain elusive!&nbsp;

To compound the cup of mercantile misery, there is an ongoing trade war between majors, the United States and China, which began slapping retaliatory measures, fouling up the global trading atmosphere and generating a sort of psychosis among others as to how to wade in the choppy waters of overseas markets that have abruptly become protectionist and impermeable. In this dismal scenario, the time to fix the roof can no longer be deferred. 
&nbsp;

(This article was originally published on DNA. Read the&nbsp;<a href="https://www.dnaindia.com/analysis/column-much-rests-on-china-for-rcep-s-rollout-on-schedule-2691979">original article</a>)

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

&nbsp;

A modern, comprehensive and mutually beneficial economic partnership agreement for an open trade and investment milieu in the Asia-Pacific region is the core objective of the Regional Comprehensive Economic Partnership (RCEP).

A modern, comprehensive and mutually beneficial economic partnership agreement for an open trade and investment milieu in the Asia-Pacific region is the core objective of the Regional Comprehensive Economic Partnership (RCEP). Countries, in diverse stages of development, from Australia, China, Japan and India to the 10 members of the Association of South East Nations (ASEAN) are part of the RCEP, besides South Korea and New Zealand. Once wrapped up, RCEP would foster the largest regional trading bloc, making up 25 per cent of global GDP, 30 per cent of world trade and 26 per cent of cross-country foreign direct investment (FDI) flows the world over. While 'substantial progress’ has been claimed by India in negotiations in 2018, a closer look is needed. So far, as many as seven chapters in RCEP encompassing economic and technical cooperation, amongst others, have been concluded. But the crucial one on market negotiations bristle with Indian reservations, as it is not prepared to let its domestic industry smothered by the deluge of cheap goods from the other members, particularly China. Interestingly, the erstwhile tiger economies of ASEAN want India to eliminate tariffs or customs duties on about 90-92 per cent items that it trades with the countries with which India has a Free Trade Agreement (FTA). These include ASEAN and Japan. With the non-FTA partners—Australia, New Zealand and China, discussions are on for removing duties on 80 per cent of traded products. New Delhi has asked for a 20-year deadline to end the duties, but with China, it seeks more time for removal of tariffs. The need for seeking a protracted liberalisation phase with China is based on ground realities. A House Panel report on the impact of Chinese goods on Indian industry, tabled in the monsoon session of Parliament, vehemently argued that “the impact of Chinese imports has been such that India is threatened to become a country of importers and traders with domestic factories either cutting down their production or shutting down completely…” From raw material to components to final product assembly, the competitive strength of the Middle Kingdom is proven beyond a pale of doubt and that too across several sectors in which the competitive strength of Indian products are ironically, at a disadvantage. According to the report, the annual year-on-year growth in Chinese imports was about 9 per cent in 2013-14, which had soared to 20 per cent in 2017-18. The trade deficit with China at $63 billion constitutes more than 40 per cent of India’s aggregate trade deficit. The Chinese goods itself constitute about one-sixth of all imports in terms of quantum in India. In the decade 2007-08 to 2017-18, there has been an increase in India’s exports to China by $2.5 billion only while its imports from China have zoomed by $50 billion during this period. With sobering statistics such as these, Indian trade envoys are naturally demanding that China should give more and we, in turn, would give China lower concessions and take a longer staging period, given the gargantuan trade deficit with Beijing. As the core of the marathon talks zero in on market access for goods, services and investment with the deadline deferred to 2019, India might have earned a reprieve from immediate danger to its cocooned domestic sectors. But as 2019 is an election year in India, the outcome of which will determine whether the proposed RCEP would be wrapped up by the incumbent dispensation or a new one, the fact remains that India must perforce have to undertake structural reforms, including correction of the much-delayed inverted duty structure, liberalisation of the mining sector to spur domestic manufacturing and markedly cut down import of steel, coal, oil and a plethora of other minerals. The urgent need to be in a mega trading bloc is nowhere crucial than at this juncture when the World Trade Organisation (WTO), is faced with an existential crisis. The numerous multilateral trade deals under its charge have come to a halt over the past decade. A slew of few trading nations have naturally pitched for regional or preferential free trade agreements (FTAs) among compact number of participants to exchange concessions and move ahead with gains accruing from such liberalised trade. For India, which has not been in any meaningful regional trading arrangement, but attempted to latch on to a few FTAs that had only brought resentment from local industries, the enduring benefits of trade remain elusive! To compound the cup of mercantile misery, there is an ongoing trade war between majors, the United States and China, which began slapping retaliatory measures, fouling up the global trading atmosphere and generating a sort of psychosis among others as to how to wade in the choppy waters of overseas markets that have abruptly become protectionist and impermeable. In this dismal scenario, the time to fix the roof can no longer be deferred. (This article was originally published on DNA. Read the original article) (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

Much rests on China for RCEP’s rollout on schedule

After hitting a historic high of USD 84.44 billion last year, China’s trade with India saw a robust growth in the first quarter this year, with bilateral trade netting USD 22.1 billion, up 15.4 per cent year-on-year, a top Chinese official said today. The growth continued from the upward momentum seen last year, when bilateral trade reached a record high of USD 84.4 billion, up 20.3 per cent from the previous year, spokesperson for the Ministry of Commerce Gao Feng said.

“As two large developing countries and major emerging market economies, China and India both have a huge domestic market,” Gao said, adding the economies of both countries are highly complementary to each other, creating enormous potential for cooperation.

“By the end of 2017, Chinese investments into India added up to more than USD eight billion, as India has become an important market for infrastructure cooperation among Chinese companies and a major investment destination,” Gao was quoted as saying by the state-run Xinhua news agency.

His comments came ahead of the two-day informal summit between Prime Minister Narendra Modi and President Xi Jinping in the central chinese city of Wuhan tomorrow, during which a host of issues, including an over USD 50 billion trade deficit between the two countries is expected to figure. A rare novelty of the bilateral trade last year, otherwise dominated by the Chinese exports was the nearly 40 per cent increase of Indian exports to China, totalling USD 16.34 billion.

The bilateral trade volume reaching USD 84.44 billion in 2017 is regarded as a landmark as for the first time it touched USD 80 billion mark, well above the USD 71.18 billion registered in 2016. The trade between the two countries touched the historic high despite bilateral tensions over a number of issues, including the China-Pakistan Economic Corridor (CPEC), China blocking New Delhi’s move to designate Pakistan-based Jaish-e-Mohammed terror group chief Masood Azhar a global terrorist, Beijing blocking India’s entry into the Nuclear Suppliers Group (NSG) and the Dokalam stand-off.

The bilateral trade stagnated around USD 70 billion despite the leaders of both the countries setting USD 100 billion as the target for 2015. Though it is still about USD 20 billion short, officials on both sides expect trade and Chinese investments in India to pick up further this year as both the governments are trying to scale down tensions and step-up the normalisation process.

"As two large developing countries and major emerging market economies, China and India both have a huge domestic market," Gao said, adding the economies of both countries are highly complementary to each other, creating enormous potential for cooperation.

After hitting a historic high of USD 84.44 billion last year, China’s trade with India saw a robust growth in the first quarter this year, with bilateral trade netting USD 22.1 billion, up 15.4 per cent year-on-year, a top Chinese official said today. The growth continued from the upward momentum seen last year, when bilateral trade reached a record high of USD 84.4 billion, up 20.3 per cent from the previous year, spokesperson for the Ministry of Commerce Gao Feng said. “As two large developing countries and major emerging market economies, China and India both have a huge domestic market,” Gao said, adding the economies of both countries are highly complementary to each other, creating enormous potential for cooperation. “By the end of 2017, Chinese investments into India added up to more than USD eight billion, as India has become an important market for infrastructure cooperation among Chinese companies and a major investment destination,” Gao was quoted as saying by the state-run Xinhua news agency. His comments came ahead of the two-day informal summit between Prime Minister Narendra Modi and President Xi Jinping in the central chinese city of Wuhan tomorrow, during which a host of issues, including an over USD 50 billion trade deficit between the two countries is expected to figure. A rare novelty of the bilateral trade last year, otherwise dominated by the Chinese exports was the nearly 40 per cent increase of Indian exports to China, totalling USD 16.34 billion. The bilateral trade volume reaching USD 84.44 billion in 2017 is regarded as a landmark as for the first time it touched USD 80 billion mark, well above the USD 71.18 billion registered in 2016. The trade between the two countries touched the historic high despite bilateral tensions over a number of issues, including the China-Pakistan Economic Corridor (CPEC), China blocking New Delhi’s move to designate Pakistan-based Jaish-e-Mohammed terror group chief Masood Azhar a global terrorist, Beijing blocking India’s entry into the Nuclear Suppliers Group (NSG) and the Dokalam stand-off. The bilateral trade stagnated around USD 70 billion despite the leaders of both the countries setting USD 100 billion as the target for 2015. Though it is still about USD 20 billion short, officials on both sides expect trade and Chinese investments in India to pick up further this year as both the governments are trying to scale down tensions and step-up the normalisation process.

China-India trade volume witnesses 15% rise in Q1

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Economic reset? India examines step-by-step relaxation in trade with China

Much rests on China for RCEP’s rollout on schedule

China-India trade volume witnesses 15% rise in Q1