### Summary
Global trade bodies, including Apple, Google, and Dell, are urging the US to persuade India to retract its IT import restrictions and hold a formal consultation with industry stakeholders.
### Facts
- 🌍 Major global IT and electronics companies are calling on the US to push India to reconsider its import restriction policy on IT hardware.
- 📜 Indian government placed laptops, tablets, and other electronics under the restricted category, requiring additional licenses for importation.
- 📝 US trade bodies have asked the US government to engage with India and ensure that its measures are consistent with international trade obligations.
- 🤝 The licensing measures imposed by India have raised concerns about the country's reliability as a trade and supply chain partner.
- 🛠️ IT hardware companies operating in India are seeking an extension of the deadline for licenses and clarity around the licensing process.
- 🌐 The trade bodies emphasize that the import restrictions could disrupt trade, harm businesses and consumers, and impose risks on data center investments.
- 🇺🇸 The United States should uphold World Trade Organization rules to discourage the expansion of such trade-restrictive measures in India and beyond.
(Source: The Economic Times)
India has become an attractive destination for global electronics manufacturers, with companies like Apple, Cisco, and Luxshare setting up manufacturing operations in the country to diversify from China and tap into India's large market, workforce, and vibrant presence of micro, small, and medium enterprises; however, there is a need for policy intervention to ensure growth extends beyond assembly units and focuses on creating an ecosystem for component manufacturing and value-addition to move up the value chain.
India has seen an increase in its tariffs and trade policy measures in recent years, reversing the trend towards liberalization and increasing trade restrictions, which is a global phenomenon as many countries are adopting industrial policies to promote domestic production and exports; however, the effectiveness of these policies and their impact on economic growth and job creation remain to be seen.
U.S. trade chief Katherine Tai has expressed concerns to India over its new licensing requirements for the import of laptops, tablets, and personal computers, citing potential adverse impact on U.S. exports and the need for stakeholder input.
India, the world's biggest exporter of rice, has imposed more restrictions on rice exports in an effort to prevent smuggling and cool local food prices ahead of a general election, further squeezing global supplies of the staple grain.
India and the US have agreed to work together to address import restrictions on electronic devices and resolve a trade dispute related to poultry products, with both nations aiming to find a resolution that addresses their concerns.
India is positioning itself as an alternative to China in the global supply chain, aiming to become a major manufacturing hub and increase its role in the production of goods, as the world seeks solutions to supply chain disruptions caused by health crises and geopolitical events.
Globalization is shifting towards a strategy of security of supply, with companies diversifying their manufacturing operations and seeking suppliers closer to home, such as India, in order to reduce risks and uncertainties associated with relying solely on China.
At least 32 international electronics companies have applied to India's incentive program to manufacture laptops, tablets, and servers in the country as part of the government's push to boost domestic manufacturing capacity.
The U.S. has expanded export restrictions of Nvidia artificial-intelligence chips beyond China to other regions, including some countries in the Middle East, citing national security concerns.
India has imposed a five-year anti-dumping duty on certain Chinese steel imports in response to concerns raised by the steel industry.
With the right reforms, India has the potential to become the next engine of global growth, benefiting from major economic re-alignments caused by China's slowdown and the US diversifying its supply chains. Major corporations are already investing in India, recognizing its potential. However, India needs to overcome challenges such as high tariffs, infrastructure improvements, and regional cooperation to fully realize its manufacturing potential and attract foreign investment.
The Indian government is planning to rationalize tariffs on components used for making electronics goods to boost local production and increase competitiveness for exports.
India will postpone the requirement of an import license for laptops and tablets for a year after facing objections and concerns from industry and the US government.
Trade restrictions on advanced technology in China do not cover antiquated equipment, leading to concerns about the flow of legacy chips into the country and the potential impact on global markets.
The US government's export restrictions on advanced computer chips is seen as a move to control China's access to AI technology and prevent Middle Eastern countries from becoming conduits for Chinese firms to acquire these chips, with countries like Iran, Saudi Arabia, UAE, Qatar, and Israel being the most likely candidates affected by the restrictions.
