INTERNATIONAL
NATIONAL
In July, goods exports fell by around 16% to $32.3 billion. This is the sixth consecutive month in which goods exports have fallen. Along similar lines, goods imports fell by 17% to $52.9 billion. This is the seventh consecutive month in which goods imports have fallen. A major reason for this fall is a drop in the price of crude oil. In July 2022, the price of the Indian basket of crude oil had averaged $105.5 per barrel. India imports a bulk of the crude oil that it consumes. As per the latest data, the country imported 88.4% of the crude oil that it consumed in April and May. In FY23, the import dependency had stood at 87.3%. Hence, once oil prices fall, the price paid for oil imports also falls. India’s oil imports during July fell by around 37% to $11.8 billion. And this has led to the overall goods imports coming down. Further, while India produces next to no oil, Indian companies do refine crude oil and export it. Again, when crude oil prices come down, India’s oil exports also come down significantly. In July, India’s oil exports fell by around 44% to $4.6 billion, mainly led by the drop in oil prices. So, how are things if we look at non-oil exports and non-oil imports? In this case the situation does seem to be worrying but not as worrying as the overall fall makes it out to be. In July India’s non-oil goods exports fell by a little over 8% to $27.7 billion. This is primarily on account of a slowdown in global growth. The World Bank expects global growth to slow down to 2.1% in 2023, after growing 3.1% in 2022. The forecast for advanced economies is worse. In 2023, the US and the Euro Area are expected to grow by 1.1% and 0.4%, respectively, after growing 2.1% and 3.5%, respectively, in 2022. This slowdown in growth already reflects in the slowdown seen in Indian goods exports to the developed world. Their lack of consumer demand is showing up in Indian exports as well. From April to June, the latest data shows goods exports to the US have fallen by a little over 13% to $18.8 billion. Exports to the European Union countries have been flattish at around $14.8 billion. Over and above this, India’s exports to the United Arab Emirates, India’s other big goods exports destination, have fallen by a little under 9% to $7.5 billion. At the same time, India’s non-oil goods imports fell by around 9% to $41.2 billion. In fact, the non-oil non-gold non-silver imports fell by around 10% to $37.6 billion. The non-oil non-gold non-silver goods imports are a good representation of domestic private consumer demand. The fall here partly reflects the increasing import restrictions along with some slowdown in consumer demand. Nonetheless, amid all this, there is a silver lining and here’s how it goes. The gross domestic product (GDP)—the measure of the size of an economy during a year—is calculated as a sum of private consumption expenditure, investment, government expenditure and net exports. Net exports is exports minus imports. In the Indian context, this tends to be a negative figure, thus dragging down the overall GDP number. During April to July the goods exports minus goods imports figure was a negative $77 billion. It was a negative $88.1 billion during the same period last year. So, the GDP calculation will benefit because of this dynamic.
Source: The Livemint.com
While the government is considering more free trade agreements that address tariff walls, the post-pandemic proliferation of non-tariff barriers (NTBs) are threatening to undo the trade liberalisation plans. NTBs have come in the form of quotas, embargoes or technical regulations, standards and conformity assessment procedures that are used to ensure safety, quality and performance of goods.The key Indian exports that routinely face high NTBs are chilies, tea, basmati rice, milk, poultry, bovine meat, fish, chemicals products to the EU;, sesame seed, shrimps, Medicines, Apparels to Japan; food, meat, fish dairy and industrial products to China. In the US fruits and shrimps exports face barriers while in South Korea bovine meat. Ceramic tiles to Egypt, chilli to Mexico, medicines to Argentina, microbiological regents to Saudi Arabia, electrical, medical devices and household appliances to Brazil. According to an assessment, 80% of India’s trade is subject to some or the other non-tariff barrier. Non tariff barriers are more effective than tariffs in regulating trade. While tariffs can regulate prices and businesses can adjust to it, the list of compliances, complex rules and time taken to meet the technical and safety requirements can dissuade many smaller and medium businesses. Most of the Indian exporters faced the issue of complex and time-taking procedures for authorization, clearances, or for mandatory testing at laboratories. Additionally, some countries also imposed their standards and regulations which are not aligned with international standards. Due to these, exporters face high costs for meeting such rigorous requirements. As sometimes, they have to change the production processes and might lack infrastructure or production technology which impacts their overall exports internationally. Most of these barriers are put by developed countries and regions like the US and the European Union. “The developed countries have agreed to very low bound tariffs at the World Trade Organisation leaving little room for them to manoeuvre tariffs and so they are using non-tariff barriers in greater numbers,” Secretary General of Apparel Export Promotion Council Mithileshwar Thakur said. The new FTAs that are being negotiated also discuss technical barriers on trade but not everything can be covered by the agreements as countries come up with newer kinds of trade barriers. The biggest NTB is on the horizon of the Carbon Border Adjustment Mechanism or carbon tax. First proposed by the European Union, now other developed countries like the UK and the US are planning something on the same lines. The protests against the carbon tax have been registered by the developing countries and the issue could also come at the World Trade Organisation. Apart from WTO and trade agreements, countries also try to deal with the issue bilaterally. “India’s exports are far below potential as most products face NTBs in the EU, USA, China, Japan, Korea and many other countries. To get to the next phase of India must address the issue of non tariff barriers which has been rising rapidly post COVID,” founder of Global Trade Research Initiative Ajay Srivastava. As the tough standards are imposed on Indian exports, the government continues to engage with those countries to minimise their impact. In the past few years China alone has issued more than 2500 notifications on non tariff barriers while the US, UK, UAE have issued more than few hundred. Other than imposing standards that are very strict and sometimes not even backed by science, the countries put a big list of procedures that take a lot of effort and time to comply. “The bigger exporters can deal with them but small and medium enterprises are discouraged and some of them give up their efforts,” Srivastava said. AEPC’s Thakur says that Industry should also be proactive when technical barriers to trade are put up. He also said while putting TBT (Technical Barrier to Trade) measures, countries notify the World Trade Organisation. Most countries follow a consultation process before a new TBT (Technical Barrier to Trade) is introduced or an existing TBT is modified. “Indian industry should proactively participate during the consultation process and register their apprehensions/ concerns and raise objections, if any, before the regulations notifying TBTs come into force,” he added. One way of dealing with the non-tariff barriers is raising domestic standards in products where export rejection is faced. “India should engage in discussions with partner countries and be prepared to retaliate if unreasonable standards or rules continue to obstruct imports from India,” Srivastava said. The hindrance posed by NTBs on India’s export performance is a critical challenge. A time frame must be decided to resolve important NTBs.
Source: Financial Express
I India must talk to partner countries for reasonable solutions," GTRI Cofounder Ajay Srivastava said. ndia needs to act in a fast-track manner for removal of non-trade barriers (NTBs), being faced by domestic exporters in different countries like the US, China and Japan, to achieve one trillion dollar outbound shipment target for goods by 2030, a report by think-tank GTRI said on Tuesday. The Global Trade Research Initiative (GTRI) has suggested a two-pronged strategy to mitigate the influence of NTBs on exports. It asked for upgrading domestic systems, in cases where Indian products are rejected due to quality issues; and retaliating if unreasonable standards or rules continue to obstruct exports from New Delhi. "Many of India's exports suffer due to time taking prior registration requirements and unreasonable domestic standards/rules in many countries. He added that many of India's food and agriculture products face problems due to higher pesticide levels, presence of pests and contaminations due to foot and mouth disease. "India must take each issue and address it in the shortest possible time," Srivastava said adding "India's exports are far below potential as they face NTBs in the EU (European Union), USA, China, Japan, Korea and many other countries". Key Indian exports that routinely face high barriers include -- Chillies, Tea, Basmati Rice, Milk, Poultry, Bovine Meat, Fish, Chemicals Products to EU; Sesame Seed, Black Tiger Shrimps, Medicines, Apparels to Japan; Food, Meat, Fish, Dairy, Industrial Products to China; Shrimps to the US; and Bovine Meat to South Korea. According to the report, the other products which face these barriers include Ceramic Tiles in Egypt; Chili in Mexico; Medicines in Argentina; Microbiological Regents in Saudi Arabia; Electrical, Medical Devices, Household Appliances in Brazil; Veterinary Pharmaceuticals, Feed Additives, Machinery in Russia. Most non-tariff measures (NTMs) are domestic rules created by countries with an aim to protect human, animal or plant health and environment. NTM may be technical measures like regulations, standards, testing, certification, preshipment inspection or non-technical measures like quotas, import licensing, subsidies, government procurement restrictions. When NTMs become arbitrary, beyond scientific justification, they create hurdles for trade and are called NTBs (non-tariff barriers). "The hindrance posed by NTBs on India's export performance is a critical challenge. A time frame must be decided to resolve important NTBs," it said. About these barriers, the report said that there are three sub-categories that are reducing pesticide levels in food products; presence of pests like food and mouth disease; and higher inspection due to suspect product quality. India's exports of basmati rice, chillies, tea and many other agriculture products face difficulty in foreign markets due to higher use of pesticide and fungicides. The traces pesticides leave in treated products are called 'residues' and a maximum residue level (MRL) is the highest level of a pesticide residue that is legally tolerated in food or feed. Citing certain examples, the report said the EU has set MRL for tricyclazole, a fungicide in rice, to 0.01 mg per kg as against the ten times higher limit earlier. Now the EU has proposed to raise the limit to 0.09 as the current level is "unreasonable and hampers" trade. Similarly, the EU has set MRL for aflatoxins B1 level in chilies and other spices at 5 to 10 ppb (parts per billion). The US limit is a higher 20 ppb for all spices. The European Union has set the level for Anthraquinone for tea at 0.02 mg/Kg. No tea grower in India uses anthraquinone as a pesticide. Tea leaves get it from the dust in the atmosphere. Japan stopped importing sesame seeds from India from 1992-93 due to pesticides/DDT traces, it said. Export of milk and poultry, bovine meat products to the EU and bovine meat to China and South Korea is difficult due to the prevalence of foot and mouth disease (FMD) in India. "India needs to invest in creating FMD free zones to export freely," it suggested. It added that each consignment of Black Tiger Shrimp and Vannamei exported from India to Japan undergoes 100 per cent inspection by Japanese Authorities. This is done to rule out the presence of an antibiotic residue called Nitrofuran metabiolite AOZ. There has been no detection of AOZ in Black Tiger shrimp for the last three years. Likewise, the EU has increased the sampling frequency from 10 per cent to 50 per cent on marine products exported from India due to frequent detection of prohibited antibiotics. Mexico has also suspended import of Indian dry chilies in May, 2017 after live pest (Trogoderma) was detected in two containers. Further regarding registration systems in different countries, the report said that registration, in most cases, requires physical submission of documents and payment of exorbitant fees. "Big pharma firms abuse patent laws as they recycle and repurpose old drugs and patent them as new, thereby encouraging ever-greening of patents. Three of every four drugs associated with new patents are not new, but existing drugs. This delays the launch of affordable generic drugs," it said.
Source: Economic Times
Prime Minister Shri Narendra Modi addressing the nation on the occasion of 77th Independence Day from the ramparts of historic Red Fort in New Delhi said we have put forth the concept of "One World, One Family, One Future” for the G20 summit and are working in that direction. As the world grapples with climate crises, we have shown the way and launched the LifeStyle for Environment – Mission LiFE initiative. The Prime Minister said we formed the International Solar Alliance in collaboration with the world and many countries are now part of the International Solar Alliance. We have emphasized the importance of biodiversity and advanced the establishment of the "Big Cat Alliance
Source: PIB
India’s imports from Russia doubled to $20.45 billion during the April-July period of this fiscal due to increasing inbound shipments of crude oil and fertiliser from that country, according to the commerce ministry data. With this, Russia has become India’s second largest import source during the first four months of this fiscal.From a market share of less than 1 per cent in India’s import basket before the start of the Russia-Ukraine conflict, Russia’s share of India’s oil imports rose to over 40 per cent. India, the world’s third-largest crude importer after China and the United States, has been buying Russian oil that was available at a discount after some in the West shunned it as a means of punishing Moscow for the invasion of Ukraine. The ministry’s data showed that imports from China dipped to $32.7 billion during the April-July period as against $34.55 billion in the same period last year. Similarly, imports from the US declined to $14.23 billion during the period under review from $17.16 billion in April-July 2022. The imports from UAE too contracted to $13.39 billion during April-July 2023 as against $18.45 billion in the same period last year. On the export front, India’s exports to seven of its top 10 destinations have recorded a negative growth rate during the period. During the first four months of this fiscal, the country’s merchandise exports to the US, UAE, China, Singapore, Germany, Bangladesh and Italy have dipped. However, the exports to the UK, Netherland, and Saudi Arabia have recorded a positive growth.India’s exports contracted by 15.88 per cent, the sixth month in a row, to $32.25 billion in July this year due to a global slowdown and fall in shipments of key sectors like petroleum, gems and jewellery. Imports during the month also declined by 17 per cent, the eighth month in a row, to $52.92 billion from $63.77 billion in July 2022. This led to a narrowing of the trade deficit to $20.67 billion against $25.43 billion in July 2022.
Source: Financial Express
Prime Minister Narendra Modi on Tuesday hailed India's contribution towards creating awareness about the importance of renewable energy and gave the slogan of 'One Sun, One World, One Grid'. Addressing the nation on its 77th Independence Day, Modi called for connecting solar energy supply across borders. "We have presented philosophies and the world is now connecting with India over them. For the renewable energy sector, we said 'One Sun, One World, One Grid'. After COVID, we told the world that our approach should be of 'One Earth, One Health'," Modi said in his independence day speech from the ramparts of Red Fort on Tuesday. The idea for the One Sun One World One Grid (OSOWOG) initiative was put forth by Modi at the First Assembly of the International Solar Alliance (ISA) in October 2018. In May 2021, the United Kingdom and India agreed to combine forces of the Green Grids Initiative and the One Sun One World One Grid The GGI-OSOWOG (green grid) initiative was jointly launched by Modi and the then Prime Minister of United Kingdom, Boris Johnson, during the 'Accelerating Innovation and Clean Technology Deployment' event at the World Leaders Summit held on November 2, 2021 during COP26. Modi further said that "We paved the way to fight climate change by launching Mission #LiFE-'Lifestyle for the Environment' and made the International Solar Alliance and many countries have become part of it." The International Solar Alliance (ISA) is an action-oriented, memberdriven, collaborative platform for increased deployment of solar energy technologies as a means for bringing energy access, ensuring energy security, and driving energy transition in its member countries. initiative and jointly launch GGI-OSOWOG at the COP26 summit hosted by the UK at Glasgow in November 2021. The vision behind the OSOWOG initiative is the mantra that "the sun never sets". The OSOWOG initiative aims to connect different regional grids through a common grid that will be used to transfer renewable energy power and, thus, realize the potential of renewable energy sources, especially solar energy. The ISA was conceived as a joint effort by India and France to mobilize efforts against climate change through deployment of solar energy solutions. It was conceptualized on the sidelines of the 21st Conference of Parties (COP21) to the United Nations Framework Convention on Climate Change (UNFCCC) held in Paris in 2015. India is promoting renewable energy in the country in a big way and aims to have 500 GW of non-fossil fuel based power generation capacity by 2030. Presently India has 178GW of renewable energy capacity which includes 71GW of solar, 44GW of wind energy and 47GW of large hydro electric capacity.
Source: The energy.economictimes.indiatimes.com
INTERNATIONAL
Spinnova has received a grant of maximum 1.9 million euros for its research and development (R&D) work from Business Finland for the period April 15, 2023 to April 14, 2025. The grant amount represents 50 percent of the project’s total cost estimate totaling 3.9 million euros. The product development project aims for pilot-scale production of SPINNOVA® fiber from textile and agricultural waste streams. The refining environment to be developed during the project can also be used for the recycling of SPINNOVA fiber. The project aims to expand Spinnova’s technology offering by adding new refining and fiber recycling components, which could be used by factories producing SPINNOVA fiber. This will open new strategic opportunities for Spinnova to expand its business. More energy-efficient refining is also expected to improve the competitiveness of the SPINNOVA fiber. “Business Finland’s grant supports our development work to become even more sustainable and competitive by being able to offer technology that can process multiple circular raw materials into textile fiber,” said Spinnova’s Chief Technology Officer and co-founder Juha Salmela.
Source: Textile World
Exports of textiles and apparel from the United States went up by 4.05% in January 2023. The value of exports stood at $1.895 billion during the period under review compared to $1.821 billion in the same period of last year, according to the data from the Office of Textiles and Apparel, US department of commerce. Category-wise, apparel exports increased by 14.97% year-on-year to $575.443 million, while the exports of yarn ($340.260 million) and fabric ($683.212 million) increased by 0.53% and 4.06%, respectively in January this year. However, made-up and miscellaneous article exports decreased by 9.09% to $296.490 million. Among the top ten markets, the shipment of textiles and apparel increased by 130% to $32.739 million in the first month of 2023. The exports increased to Netherlands (69.25%), United Kingdom (48.46%) and Dominican Republic (14.24%). However, the shipment to Mexico, Canada, China, and Japan witnessed a decline. The US supplied $550.629 million worth of textiles and apparel to Mexico during the period, followed by $424.778 million to Canada and $100.851 million to Honduras. Exports of textiles and apparel from the US had gone up by 9.77% to $24.866 billion during 2022 compared to $22.652 billion in 2021. In the recent years, the US textile and clothing exports have remained in the range of $22-25 billion per annum. In 2014, they stood at $24.418 billion, while the figure was $23.622 billion in 2015, $22.124 billion in 2016, $22.671 billion in 2017, $23.467 billion in 2018, and $22.905 billion in 2019. The value had dropped to $19.330 billion in 2020 due to the COVID-19 pandemic.
Source: Fashion net work
Germany's trade surplus in the first half (H1) of 2023 more than doubled year-on-year to 98.7 billion euros (108.6 billion U.S. dollars), the Federal Statistical Office (Destatis) said Friday. While exports rose by 3.3 percent to 797.8 billion euros in the first six months, the value of goods imported by Europe's largest economy fell by 4.3 percent to 699.1 billion euros, according to Destatis. With a value of 136.5 billion euros, motor vehicles and motor vehicle parts were the country's bestselling product group abroad. According to the German Association of the Automotive Industry (VDA), the country's carmakers increased their H1 exports by 32 percent year-on-year to almost 1.7 million units. Pre-COVID-19 levels, however, will remain "out of reach"this year.
Source: Thestar.com
