Hi Friends,

Even as I launch this today ( my 80th Birthday ), I realize that there is yet so much to say and do. There is just no time to look back, no time to wonder,"Will anyone read these pages?"

With regards,
Hemen Parekh
27 June 2013

Now as I approach my 90th birthday ( 27 June 2023 ) , I invite you to visit my Digital Avatar ( www.hemenparekh.ai ) – and continue chatting with me , even when I am no more here physically

Thursday 22 March 2018

#WTO #Export #Import #Economy #BalanceOfPayment


A  #TradeWar  Epidemic  ?



Not everyone agrees but there are unmistakeable symptoms



For differing reasons, all countries want to #export more and #import less



Emerging countries believe that an export-led economic growth could raise per capita income of its poor citizens and create jobs for millions of their #unemployed youth .



They think their own domestic consumers just don’t have enough money to consume more of locally produced goods



Then there is USA , which believes that , in order to correct the #trade-imbalances , other countries must :


#   buy more from USA

#   export less to USA



#DonaldTrump also believes that local Industries – and jobs within those industries – can be saved from getting decimated by imposing high #import-duties on imports into USA



By imposing 25 % duty on Steel / 10 % duty on Aluminum / 70 % duty on Solar Panels , he thinks he can save 170,000 American jobs



But some economists think , this step will destroy 450,000 jobs in the US automotive industry , since input costs will push up selling prices, which in turn , will reduce the demand ( local + export )



At the same time, Trump has agreed to exempt Canada / Mexico from these revised duties



Other major steel-exporting countries ( to USA ) , are asking similar exemptions !



Some ( like EU ) are even threatening counter measures on US exports to them !



As of yesterday , US has slapped a “ #AntiDumping Duty “ on stainless steel flanges imported from India , claiming these are priced 18 % to 145 % below their fair value !



Not leaving things at this, last week US has lodged a complaint with #WTO against India !



US wants India to stop all #ExportSubsidy to its exporters , as mandated by #WTO clause

{ Since,  India’s per capita #GDP exceeded $ 1,000 per year for 3 years in a row }



"These #Eexport-Subsidy programs harm American workers by creating an uneven playing field on which they must compete," said US Trade Representative Robert Lighthizer.



I believe India’s Export Subsidies , add up to $ 7 billion per year



No doubt , Commerce Minister Nirmala Sitharaman and Commerce Secretary Rita Teaotia , will defend India’s position at #WTO



They may even succeed in getting extension of a few years for India to phase out / dismantle its current practice



But, at the most , they may succeed in “ postponing the evil day “  !



As FIEO , Director General , Ajay Sahai told PTI :

"It is a huge concern for export sector and the industry feels that the so called export subsidies should be eliminated gradually "



We , in India , must realize the following :



·         Trade wars will intensify with all countries trying to protect local jobs / industries



·         In this “ dog eat dog “ world, WTO cannot continue to provide much protection, where large importing countries want to “ balance their trade surpluses / deficits “



·         #Multilateralism will gradually give way to #Bilateralism



·         Bilateral Trade Agreements will be a matter of “ trade off / give and take “



·         In this war there will be neither permanent friends nor permanent enemies




·         Even an enemy of your enemy, may not count as your friend !



·         Only way to survive, will be by ensuring that we turn India into a :


#LOW-COST-ECONOMY,


where we can compete with the rest of the world ( for our share of the World trade ), on the basis of a BETTER  QUALITY / LOWER  PRICE / FASTER  DELIVERY , of our products and services



We must immediately implement #REFORMS which will help our companies lower  their costs of :



#      Manpower         (  Salaries / Wages  )


#      Materials            (  Raw materials / Components / Sub Assys )


#      Money                (  Funds / Finance / Capital )


#      Space                 (  Constructed factories / offices / homes  )


#      Management       (  Manufacturing and Marketing Overheads )


#      Compliance         (  Forms / Reports to be filled / filed  )


#      Corruption           (  Bribes to be paid to Govt Agencies / IT dept  )


#      Non-Governance  (  MPs – MLAs fail their responsibility  )



 

As far as enabling Indian companies to lower their costs is concerned ,  ( -  thereby , effectively making them more competitive in export market ), there is an urgent need for our governments ( both at the Centre and at the States ) , to :

·          Speed up the pace of #REFORMS already initiated during past 4 years

·         Initiate NEW REFORMS



During the past 4 YEARS , I have sent many suggestions to our Policy Makers

It is not possible to list all of these here

But , readers interested to know , may look up a few of these at :

·         Agenda  for  Reforms  [  01  Oct 2015  ]



·         CitizenMonologues  [  24  Oct  2017  ]

 

·         HaveA Good Suggestion ? Send it to PM  [ 08  Nov  2016  ]

         https://myblogepage.blogspot.in/2016/11/have-good-suggestion-send-it-to-  pm.html

 

 

·         An App for Everything ?  [  18  Aug  2017  ]

          https://myblogepage.blogspot.com/2017/08/an-app-for-everything.html

 

 

·         Level-PlayingField is a Double Edged Sword !  [  08  Feb  2017  ]

     https://myblogepage.blogspot.com/2017/02/level-playing-field-is-double-edged.html

 

 

22  March  2018

 

    www.hemenparekh.in / blogs

 

 


 

 

 

 

 

 

 

 

 

 

 







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