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Exports to US at stake
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Bikky Khosla | 16 Jul, 2013
Two of our top ministers -- Anand Sharma and P Chidambaram -- have just returned from their visit to the US, during which they met several US government officials, members of the US Congress and heads of some top American companies, and tried their best to woo US investors. Following this, official releases have been churned out saying that a number of major trade related issues were discussed and a set of "action-oriented recommendations" would soon be worked out. But still nothing is much clear about what we are going to gain or where we will lose out from the recent negotiations.
GSP or Generalised System of Preferences is one such issue -- we are keeping our fingers crossed and hope that the US will continue this facility for Indian exporters. This programme, under which preferential duty-free treatment is provided for up to 3,500 products from 127 designated beneficiary countries including India, is due on July 31, and lately there has been a growing concern that the sops might not be extended for India any further. And if this happens, our exporters, particularly the small and medium scale ones, will be hit hard. In 2012, total US imports under GSP amounted to $19.9 billion and India topped the list of beneficiaries with its total exports to the US under the scheme amounting to $4.5 billion. These figures show how much the negative impact could be on our exports.
What is reason behind this clamour and concern about GSP?
In recent months, we have seen a growing US protest against India's "discriminatory" trade policies. The setting up of the 'Alliance for Fair Trade with India' in June by some US companies is a perfect example of this. The trade lobby alleges that Indian policy makers and courts have engaged in a "persistent pattern of discrimination" over the last year hurting interests of the US industry. Similarly, the US legislators seem no less worried. Last month, more than 40 senators signed a letter to the US Secretary of state John Kerry asking him to make it clear to India that the US would consider "all trade tools at its disposal" if India does not end its "protectionism". And earlier, Washington had approached the WTO to challenge the domestic content requirements norms in our national solar program.
Another worry is that it doesn't seem that Indian negotiators are in a strong position at this moment to bargain at the negotiation table. The UPA government is grappling with some major economic challenges -- including high current account deficit, slowing growth, drying up foreign investment, and more recently, a weakening currency -- and this may force them to bow down to some undue US pressure in return of some quick fix solutions in the form of foreign investment, without considering any long-term view. In addition, the General Election is scheduled early next year and this also may make them more compromising on some "less significant" issues like GSP for the sake of some kind of window-dressing of their performance report before the election.
I invite your opinion on this. Don't you think GSP cut for India will further hit our exports to the US, which currently consumes around 11 percent of our total exports?
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India must stop exporting to the US
Ashish Gandhi | Mon Jul 22 11:10:45 2013
According to me, India must stop exporting to the US and also not worry as it is only 10 to 11% of our GDP. We do need to export to US as much as they need to import from India. We - our government - should potentially support all the manufacturers affected financially. Also we should in the same way stop importing and consume only Indian manufactured goods. This will make Indian manufacturing base stronger and better increasing employment supporting all the population. It will also open new markets for our country.We can self support our country and develop it beautifully.
Growth led export is the key
Lakshmi Narasimhan Balaraman | Sun Jul 21 18:06:59 2013
for a country having 130 crore population growth led export is the better option than export -led growth.
Exports to US
PANKAJ SANGANERIA | Sun Jul 21 08:59:07 2013
US and Europe are more interested in utilising Indian as a consumption centre for their products. They would rather prefer China to India in prevailing circumstances. India needs to brace up and introduce innovative products and low cost instead of begging !
currency weakening problem
Raju Joseph | Sat Jul 20 09:41:06 2013
According me, India must stop all the imports items from China. when we produce this products from India for our needs and for the world, automatically our market will survive. There is no doubt in that.We are importing a lot of items from this China only, It says Indian govt. is piercing on the back of Indian Industrialist.Why do our money should go to china. Why our people work in other country. Indian govt. must make such a situation so that all Indian can come back to India and give employment to Foreigners. We must take a strong step to reduce importing plastic inputs to India. eg:- small toffee to even coffin box, toys, fabrics, office stationery, etc., There is chances, my views may be wrong.
Exports to Us
m v bhagwat | Wed Jul 17 15:30:17 2013
story appears timely & throws worries there should be an immidiate discussion inviting experts (not politicians) through electronic media on a number of channels
its time to know our plus points
Ajeet Guruji | Wed Jul 17 12:10:07 2013
I don't think India should bow down as far as GSP is concerned. US need Indian market as badly. We must not forget that number of American companies depends on Indian market for their global growth. American and European market are matured and don't offer growth as indian and other Asian markets. Moreover, there are number of NRIs staying in US who will have need of Indian goods and it will give some export opportunity to US even if they cut GSP. At other hand Indian exporters will be pushed to look at newer markets if pressure is built by such a negative action by US. But yes, only worry is - is over government strong enough to respond as strictly as US?
Ref Exports to US at stake
Abhay Naik | Wed Jul 17 09:50:51 2013
With reference to comments from ministers;the main issue is,Indian exports can not compete with other Asian countries in terms of price of product.This is only due to excessive,multiple duties/taxes.Other reason is export of raw material to neighboring countries who buy it from us with cheaper price & blend it with their domestic product to offer better/cheaper product than us.Export of raw material also creates shortage in our country resulting increase of price as well as delivery/sourcing time of it.
Why US wl place orders with us if we are more in price & delivery time?
Export to USA
K G | Wed Jul 17 07:53:07 2013
I think India with 1.25 billion people should set a target for independence from import in certain products as minimum, and this list should increase by time scale.
Export to USA will be because of low cost of labour in India, and as long as it exists, it will continue. India should remove shackles from exporters and let them be a USA company in India.
India has killed own people by complicated procedures and controls. FDI is a trap from those foreigners who have a business in India. This country has inner potential which it did not use to its own benefit.
Indians should set up business in USA and outsource it in India on no-profit no-loss basis, so that Indians can be trained in skills and can go outside on own merit and become global citizens. No hope, that India will genuiniely have a hospitable state for its own people.
Ankita | Wed Jul 17 07:21:31 2013
Well taking the whole scenario into consideration,I do believe that GSP cut down will definetely hit Indian export. Hence it will add to the already existing problems for the Export companies.
They will most likely sacrifice real good bargains
Abhijeet Umathe | Wed Jul 17 05:54:36 2013
We do not have a good track record in trade negotiations and view has always been short sighted. The incumbents have to deal with the street of looming elections and rising dollar, they will most likely sacrifice real good bargains in exchange for some short term good news for immediate electoral gains. This applies to the entire political class. It is high time all the parties came together and create a unified plan with respect to foreign policy, trade and defence.
India should be giving GSP to US
Philomin Jeyaraj | Wed Jul 17 01:14:07 2013
India should be giving GSP to US companies instead of it being the other way around. US investment policies are designed for the maximum good of the country and people, not just Iowaans or Connecticutians, etc. On the other hand investment decisions are made on Tamilian, Keralaan, Punjabi, Gujarati, etc. Thus politicians are having a field day and wreaking havoc to the country's well being.
GSP views
Pradeep Ganu | Wed Jul 17 00:53:31 2013
The trade lobby alleges that Indian policy makers and courts have engaged in a "persistent pattern of discrimination" over the last year hurting interests of the US industry. Similarly, the US legislators seem no less worried. I advise caution for USA please delete courts from discrimination charge they do not discriminate make a charge that justice is delayed it is right Indians are not afraid and they are ready to pay a price for their honour please present the correct picture and don't lie.
Is it because of India's relation to Iran!
Thomas J Coyne jr | Tue Jul 16 18:31:39 2013
Perhaps other issues in consideration of the reluctance of a continuing dialogue on Indian exports has to do with India's reluctance to support dealings with Iran and India's support of Iran industries and exports. Perhaps it also has to do with India's failure to stop plagerising US technology and patents and continued use of U.S. developments without recognition of inventor's rights.
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