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Ban on Chinese Goods in India

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Ban on Chinese Goods in India
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   Insights Mind maps www.insightsonindia.com Page 1 Ban on Chinese Goods in India 1)   Reasons for the ban    The government of India put a ban on the import of various goods from China including some electronic items, specific mobile phones, milk and milk products and some steel products on April 25, 2016.    Import of such items from China has been harming India's small and medium enterprises.    Quality concerns have also been cited as one of the reasons for the ban.    Chinese products in the past have been found to be contaminated (baby food, lead in toys), they are also an easy target for hoaxes.    There are reports that fake plasti eggs fro Chia ere eig sold i superarkets i Kerala      India has been expressing concern over the trade deficit which last year touched USD 46 billion.    Calls for boycott of Chinese goods in India following China's opposition to a UN ban on Jaish-e-Mohammed chief Masood Azhar 2)   India-China trade    Chia aouts for earl % of Idia’s iports.    Toys, kite strings and crackers may be the m ost isile iports for osuers, ut the do’t ee make the top 10 by category.    The big numbers are classed as industrial goods — electrical machinery, nuclear reactors and organic chemicals.    Industry lobbies such as CII believe that strong trade relations between India and China are important for both nations    The tilt in India-China trade is heavily skewed towards Chinese companies and their presence looms everywhere.    I the last  ears, hile Chiese eports to Idia galloped at 5%, Idia’s eport s to China grew by only 25%    cost effective Chinese goods help rein in inflation and benefit low-income Indian consumers 3)   Positive aspects on blanket ban    This would make customers to use domestic products, increase domestic revenue and boost to domestic industry especially MSMEs    Increase in competition among Indian products, could lead to quality commodities in the long run and could create self sufficiency in the future in line with Make in India    It will create huge employment opportunities in many sectors   Insights Mind maps www.insightsonindia.com Page 2    It will reduce dependency on china and make Indian goods even more competitive in the domestic market.    It will help reduce our import bill and save the forex reserves.    Emotional satisfaction for people especially in situations where there is Increased support of China to Pakistan 4)   Negative aspects on blanket ban    Trade data shos Idia’s argaiig poer is liited: Idia eeds Chia ore tha Chia eeds India.    Trade is a good thing: it increases economic well- being and can help avoid wars.    In eight of the top 10 categories by value, India imports more from China than any other nation, essentially drowning out the demand for a blanket ban.    India's imports from china mainly include machinery, electronics, Bulk drugs etc. Banning imports from china will drastically reduce the availability of such items in India    China may reciprocate such a ban on Indian goods. This might not be a huge risk to China as most of the imports from India like cotton; textiles etc. are easily available from other countries.    India will have to face legal issues in international forums like WTO which mandates equal treatment to all the trading partners.    Trade relations might impact peace between the countries    China is being a centre piece in all the recent regional initiatives like BRICS, AIIB, NDB, and RCEP etc. Such friction with China might impact effective transactions in these forums.    India needs support from China in getting the membership of NSG, getting into the UN Security council etc. this move will further worsen the chances.    India has been negotiating for Indian IT and pharma companies to access the Chinese market. It might get derailed due to such move.    Complete ban of trade will directly relate to disrupt of relations in other dimensions like cultural, political, people to people contact etc as trade and commerce is the connecting link between countries in the recent era.    There may a possibility that allies of china can also cut its trade with India.    credibility of India as an investment hub will come down and hence will impact FDI    India is aspiring for UNSC membership, violating WTO norms will deteriorate Idia’s  image globally    Chinese products are available at prices that we just cannot get in India.    Economically, it would hurt India more than China    Politically, it would slow progress in bilateral relations   Insights Mind maps www.insightsonindia.com Page 3    strategically, it would foster the perception in Beijing that Indian trade policy is subject to the US pivot in Asia    The move would not only increase the cost of Indian imports but would also affect upstream and downstream industries and cost jobs. 5)   Need of the Hour    To make trade more sustainable, there is a need for India to export more goods and services to China, become part of East Asian supply chains, and develop closer linkages of small businesses on both sides    There is an opportunity for China to invest in long-term infrastructure projects in India, even as India can grow exports in the areas of IT services, pharma, auto ancillaries and tourism    The advent and growth of Chinese companies —  and the money they bring —  may be an opportunity for Indian companies to learn from the best operators in the game.    For example, the Silk Road Economic Belt and the 21st century Maritime Silk Road, popularly called the One Road One Belt could serve as a catalyst for the infrastructure investments India needs    enhancing economic ties would be a preferable way to promote the comprehensive bilateral relationship    India should be looking to demand greater market access for some of its exports to China.    Need to take some major initiatives to correct the widening trade imbalance between the two countries and try and lessen our import dependence.    Efforts such as encouraging Chinese Smartphone makers to set up production lines in India may be the most effective way to reduce the trade deficit    The imbalanced bilateral trade structure is actually a result of the fact that China and India are at different developmental stages in terms of industrialisation. India also needs to upgrade its industrial structure    The commercial cooperation between two countries could be focused on e-commerce, service and financial investment.
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