ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Assessing the US–ChinaEconomic and Trade Agreement

The United States and China had signed Phase One of the Economic and Trade Agreement, the process to end the nearly two-year-old trade war between the world’s two largest economies. The agreement reads like a charter of demands that the US has made on China in several key areas. A critical analysis of the agreement and the implications for the two countries are presented.

Union Budget and the Trade Sector

The Union Budget for 2020–21 emphasised the need to restrict imports. A number of measures were proposed to realise this objective. These include the use of tariffs and non-tariff measures, making Rules of Origin agreed upon in the free trade agreements work efficiently, and effective monitoring of imports and exports. The finance minister spoke of modifying import tariffs for creating a level playing field for micro, small and medium enterprises in several product sectors and using import tariffs to promote the domestic production of electric vehicles and mobile phones.

India’s Withdrawal from the Regional Comprehensive Economic Partnership

India withdrew from the largest ever free trade agreement, the Regional Comprehensive Economic Partnership after a multitude of stakeholders, including farmers’ organisations, trade unions, and industry associations, spoke in one voice on the adverse implications of the agreement. India has three FTAs with the members of Association of Southeast Asian Nations, Korea and Japan, which were expected to increase India’s exports. Exports did not increase as Indian enterprises lack competitiveness, but imports from the partner countries expanded, leading to the haemorrhaging of domestic manufacturing. Future participation in FTAs must be conditioned on improving the competitiveness of domestic entities.

Trade Wars of the United States

Providing a structural context to the trade imbalances of the United States, which has stirred President Donald Trump into authorising a series of potentially catastrophic retaliatory actions, this article describes the bare bones of US’s actions and the likely impact on the global economy and institutions like the World Trade Organization.

Reality of US Farm Subsidies

With the formation of the World Trade Organization in 1995, the United States farm subsidies had moved towards income support, reducing spending on price support measures. The explicit reason was that the WTO had held that the latter forms were more market distorting and had thus put limits on their spending. The new Farm Act 2014 has changed the orientation of farm spending in the opposite direction. Pricebased measures are back in focus, and the US seems less concerned about breaching its WTO limits.

Yuan Devaluation and Its Impact

The warning signals have been there for some time--China's merchandise trade has been contracting and its economy has been slowing. Now the yuan has been devalued by 1.9%. What will be the outcome, especially for India?

Trans-Pacific Partnership Agreement

The full implications of the establishment of the United States-led Trans-Pacific Partnership Agreement need to be considered carefully by the global community. The proposed agreement could act as a trigger for the setting of a "new normal" in economic integration between countries, whose terms would be significantly tougher as compared to those existing under the multilaterally negotiated rules of the World Trade Organization.

India's New Foreign Trade Policy

Despite some steps in the right direction, the new policy has several limitations. This article makes a case for looking at them anew.

India's Current Account Deficit

India's current account deficit has widened in recent years primarily because of the steep increase in the deficit on the merchandise trade account. While imports have grown with the surge in gold imports, export performance has been indifferent despite the fact that India has formalised several free trade agreements. Policymakers will have to move away from a reliance on ad hoc solutions and find ways to address the infi rmities in the domestic economy.

India's Bilateral Investment Agreements

This paper highlights some of the provisions in India's Bilateral Investment Promotion and Protection Agreements that have enabled foreign investors to win cases before international arbitration tribunals. Warning that these disputes with foreign investors signal the emerging struggle between foreign investors and sovereign states in the face of uncertain economic prospects in the post-crisis world, the paper makes a strong case for a review of India's BIPAs so that there is consistency in provisions across all such agreements in the national interest.

Vaulting over India's Retail FDI Policy Wall

Multi-brand retail was opened to foreign participation in September 2012, but even earlier some Indian and foreign companies had used a maze of relationships between themselves and their subsidiaries to bypass the restrictions. An analysis of the Bharti-Walmart venture.

Foreign Direct Investment Caps in India and Corporate Control Mechanisms

While India has generally been following an open door policy in foreign direct investment, a few areas are still subject to caps on fdi. The need to retain a degree of control over the operations of the investee companies in Indian hands is one of the justifications for the caps. In early 2010, the government specified the methodology for calculating indirect foreign equity in order to remove ambiguities in calculating the extent of fdi in a company. This paper argues that the percentage of shares or proportion of directors on the board does not necessarily represent the extent of control and therefore more direct intervention would be required if the policy objectives are to be achieved.

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