Main topic: India restricts import of laptops, tablets, personal computers, and servers.
Key points:
1. The Ministry of Commerce and Industry in India has announced a restriction on the import of laptops, tablets, personal computers, and servers.
2. The restriction is effective immediately and is part of an amendment to the import policy.
3. The import of these products will only be allowed with a valid license for restricted imports.
4. The reason behind this restriction is unclear at the moment.
5. Further details about the revised policy are yet to be provided.
### 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)
### Summary
India has witnessed a surge in inflation, reaching a 15-month high, primarily due to soaring prices in essential commodities. The government is implementing measures such as reducing retail prices, imposing export bans, and releasing wheat into the market to stabilize prices.
### Facts
- 🔺 Inflation in India has reached a 15-month high, driven by soaring prices in essential commodities such as vegetables, pulses, spices, and cereals.
- 🌍 Global uncertainties, including geopolitical tensions and crude oil price fluctuations, add to fears of food inflation picking up in India.
- 💰 The Reserve Bank of India (RBI) aims to maintain a tight grip on inflation and anchor it close to the 4 percent mid-point of the desired range.
- 💡 To mitigate the impact of rising prices, the Indian government has taken various steps, including reducing retail prices for specific stocks of tomatoes, imposing export bans on rice, and releasing wheat into the open market.
- 🇮🇳 Prime Minister Narendra Modi acknowledges the challenge of high inflation and vows to take more steps to minimize the burden of rising prices on citizens.
- 🌾 The government announces a 40 percent export duty on onions until the end of 2023 to control rising prices driven by supply-side challenges.
- 💸 The government is considering reallocating funds from various ministry budgets to address surging costs without jeopardizing the federal deficit target.
- 🛢️ Possible measures may include reducing taxes on domestic petrol sales and relaxing import tariffs on cooking oil and wheat.
- 📉 The central bank keeps borrowing costs unchanged, maintaining one of the highest rates in Asia, to address concerns about escalating prices.
- 🍚 India has also imposed a ban on non-basmati rice exports and implemented a 40 percent export duty on onions to maintain domestic supply and stabilize prices.
### Prime Minister Modi's Commitment
Prime Minister Modi emphasizes the need to take measures to ease the burden of rising prices on Indian citizens and pledges to continue efforts in this regard.
### The Indian Government's Multi-faceted Approach
India is adopting a multi-pronged approach to address inflation, with measures implemented by both the RBI and the government. These efforts demonstrate the nation's commitment to maintaining economic stability and minimizing the impact of inflation on the populace.
### Summary
India's total exports and imports of goods and services surpassed $800 billion in the first half of 2023, with a healthy growth in the services sector offsetting a slowdown in global demand.
### Facts
- 📈 Exports of goods and services rose by 1.5% to $385.4 billion in January-June 2023 compared to the same period in 2022.
- 📉 Imports declined by 5.9% to $415.5 billion during the first half of 2023, compared to January-June 2022.
- 💵 Standalone goods exports dropped by 8.1% to $218.7 billion, while imports contracted by 8.3% to $325.7 billion.
- 💼 Services exports grew by 17.7% to $166.7 billion, while imports rose by 3.7% to $89.8 billion during the six-month period.
- 💰 The depreciation of the Indian Rupee didn't prevent the decline in merchandise exports, and weak global demand and loss of competitiveness in labor-intensive sectors contributed to the modest decline.
- 🌍 Several factors, including conflicts, inflation, monetary policies, and financial uncertainty, are expected to weaken world trade in 2023.
- 🛡️ India should focus on increasing product quality and supply chain competitiveness, retain policy space in free trade agreements and Indo-Pacific Economic Framework for Prosperity (IPEF), and be prepared to respond to unilateral policy decisions.
- 📊 Among the product categories contributing to India's exports, 11 out of 29 registered positive export growth, while 18 declined during January-June 2023.
- 📱 Smartphone exports surged to $7.5 billion in the first half of 2023, up from $2.5 billion in the same period in 2022.
- 🌐 India's exports declined in 134 of the 240 countries it exports goods to, with major declines observed in the USA, UAE, China, Bangladesh, and Germany.
- 🌐 India's export promotion should focus on the 41 countries where its exports exceed $1 billion, accounting for 87% of its exports.
- 👥 The top 15 countries with which India has the highest trade deficit include China, Russia, Saudi Arabia, Iraq, and Switzerland.
- 📉 The share of free trade agreement partners in India's merchandise exports decreased from 30.1% in the first half of 2022 to 26.8% in 2023.
- ⛽ Import of crude petroleum declined by 7.6% to $73.2 billion in January-June 2023, with Russia's share in India's import of petroleum crude increasing significantly.
- 🌍 Import growth from major suppliers like Iraq, Saudi Arabia, and the UAE declined during this period.
The Indian textile industry needs to double its production capacity by 2030 to meet government targets, and industry organizations are hoping for incentives and measures from the government to help overcome the current stagnant global and domestic markets.
India is reportedly considering a policy to reduce import taxes for automakers, including Tesla, that are willing to produce vehicles in the country.
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.
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.
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.
India has dropped retaliatory customs tariffs on American goods such as almonds, apples, walnuts, and lentils, just before U.S. President Joe Biden's visit to New Delhi for a bilateral meeting and the G-20 Summit.
India's import restrictions on personal computers and laptops, aimed at boosting domestic manufacturing, have caught major suppliers off guard and may deter foreign investment.
India's steel producers anticipate a rise in local manufacturing and a decrease in prices after the government's imposition of an anti-dumping duty on steel wheels from China, leading to increased competition and lower domestic prices.
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.
India is considering a one-year delay on the requirement for licenses for imported laptops, tablets, and personal computers, offering relief to companies like Apple, Samsung, and Lenovo. The move aims to promote local manufacturing and reduce dependence on imports.
India's largest manufacturer of solar modules, Waaree Energies, is urging the government to reinstate trade barriers to protect domestic manufacturers from cheap imports from China and Vietnam.
