India & the World: Trade Relations

Introduction

• India has formal diplomatic relations with most nations; it is the world's second most populous country, the world's most-populous democracy and one of the fastest growing major economies

• India is a newly industrialised country, it has a long history of collaboration with several countries and is considered one of the leaders of the developing world along with China, Brazil, Russia and South Africa

• Till the early 1990s, India was a closed economy: average tariffs exceeded 200 percent, quantitative restrictions on imports were extensive, and there were stringent restrictions on foreign investment

India Relationship• India has also played an important and influential role in other

international organisations like East Asia Summit,World Trade Organisation

• India is currently seeking a permanent seat in the UN Security Council, along with the G4 nations

• India-Sri Lanka Free Trade Agreement is also done.• Trade Agreements with Bangladesh, Bhutan, Sri Lanka,Maldives,

China, and South Korea.

India’s Trade Partners• According to the Department of Commerce, the fifteen largest trading

partners of India represent 62.1% of Indian imports, and 58.1% of Indian exports as of December 2010

• India's total merchandise trade has increased over three-fold from $252bn in 2006 to $794 in 2012 - both exports and imports have trebled during this period

• Today india scenario is that: Piece by piece, we're establishing a lasting partnership that's equipped to tackle today's global challenges

• India and other country must also keep working together on major global challenges, such as addressing the drivers of climate change that have critical implications for every nation

Country Exports Imports Total Trade Trade Balance

United Arab Emirates 36,265.15 38,436.47 74,701.61 -2171.32

China 13,503.00 54,324.04 67,827.04 -40,821.04

United States 36,152.30 24,343.73 60,496.03 11,808.57

Saudi Arabia 9783.81 34,130.50 43,914.31 -24,346.69

Switzerland 1,116.98 29,915.78 31,032.76 -28,798.80

Singapore 13,608.65 7,754.38 21,363.03 5,854.27 Germany 7,244.63 14,373.91 21,618.54 -7129.28

Hong Kong 12,278.31 8,078.58 20,356.89 4,199.74

Indonesia 5,331.47 14,774.27 20,105.75 -9,442.80 Iraq 1,278.13 20,155.94 21,434.07 -18,877.81 Japan 6,099.06 12,514.07 18,613.14 -6,415.01 Belgium 5,506.63 10,087.16 15,593.80 -4,580.53 Kuwait 1,060.80 16,569.63 17,630.43 -15,508.83 Iran 3,351.07 11,603.79 14,954.86 -8,252.72

South Korea 4,201.49 13,461.25 17,662.73 -9,259.76

in millions of US Dollars

Trade Relation with Japan• With trade between India and Japan at $18.51 billion, it accounts for a 2.34%

share in India’s global trade.• Petroleum products, oil meals, marine products, gems and jewellery and iron

ore being the principal commodities of export to Japan while machinery, iron & steel, electronic goods, transport equipment and project goods are the major items that India imports.

• After Comprehensive Economic Partnership Agreement (CEPA) was signed between India and Japan in 2011. In 2012-13, India’s exports to Japan were $6.10 billion while the imports stood at $12.41 billion, leaving a trade deficit of $6.31 billion.

• The presence of Japanese companies in India has increased from 555 sites in 2008 to 1,422 sites in 2011 and is expected to reach 2,500 sites by 2015.

• From April 2005 to March 2013, the cumulative Indian investments into Japan are around $371.46 million while according to JETRO, Japanese investments in India are around $15.93 billion

Import• Crude petroleum is India's biggest import with $155bn spent on it in

2012. Imports of gold and silver amounted to $62bn and electronic goods and pearls and precious stones are also top import items for the country.

• India's top import source is China followed by the UAE, Switzerland and Saudi Arabia. The UK came in at 21st place in 2011-12 with India importing a total of $7.7bn. In the six months recorded so far for 2012-13, the UK has dropped a place and has a 1.4% share of the India's import sources.

Top importers from India, (in US$m) 2012-13

USA 19704.05 13.87

UAE 18601.71 13.09

SINGAPORE 6652.77 4.68

CHINA 6417.32 4.52

Export• A india trade relation is moving towards southern countries,

particularly in the Asia and Africa regions.• Asia is a key destination of India's exports - in 2001-02 Asia's

share stood at 40.2% but in 2011-12 it grew to to 51.6%.• Europe, however has seen a decline in its share, down to 19% in

2011-12 from 24.8% in 2001-02 Top exporters to India, (in US$m) 2012-13

CHINA 28025.57 11.92

UAE 19622.81 8.35

SAUDI ARABIA 16094.83 6.85

USA 12208.05 5.19

Product Exports & Import By India

• India's key exports in 2012 were petroleum products which generated $56bn

• India continues to be one of the fastest growing exporters of engineering goods, it contributing 21.49% of its total exports

• India Export of Mineral Fuels, Mineral Oils And agricultural products to major part of world

• India imports more than 70 per cent of its weapons and technology for its defence needs

• Crude petroleum is India's biggest import with $155bn spent on it in 2012  

India Stand AT World Level• The transformation of the India and world relationship was

India's rapid economic growth & the best foreign policy today

• If we pointing that back to back visits by the Japanese emperor and prime minister, make closer trade and investment links between two country

• Now India government stand on trade and investment policy which displayed a marked shift from protecting ‘producers’ to benefiting ‘consumers’

• India should guard against being taken for granted, because some country is smart enough to respond to India's gestures and will do a lot to keep India happy for carry out their work 

• If we really want to stand at world level we need flexible policy for trade, infusion of new idea, and innovative work practice

• If we want sustainable growing trade, we should involve in different project at world level such as BRIC development bank project, contingency reserve agreement etc

Key impoter of india

• Imports in India increased to 36486.30 USD Million in December of 2013 from 33833.20 USD Million in November of 2013. Imports in India is reported by the Ministry of Commerce and Industry

• According to UNCTAD's report, India's is ranked 9th most attractive investment destination in the world, in terms of FDI (Foreign Direct Investment). FDI as a percentage of GDP has increased from 0.9% in 2005 to 2.8% in 2008 (higher than China's)

India- China : Bilateral Trade

• India & China signed a Trade Agreement in 1984• India's trade deficit with China touched almost $40 billion in

2012-13• China ranks 31st in terms of FDI inflows into India• China is already India's largest trading partner, overtaking

even the US• China and India are the 2nd and the 5th largest economies in

the world the prospect of bilateral trade • The Indian IT-BPO industry currently employs around 15,000

people in China, of which 90-95% are Chinese employees

Indian exports to china

• Ores• Slag and ash• Iron and steel• Plastics• Organic chemicals• cotton

Source:http://business.mapsofindia.com/trade-relations/india-china/#sthash.AYvEKiZp.dpuf

• Potential areas • Biotechnology• IT and ITES• health• education• tourism• and financial sector

http://business.mapsofindia.com/trade-relations/india-china/#sthash.AYvEKiZp.dpuf

Indian imports from china• Electrical machinery and equipment• Cement• Organic chemicals• Nuclear reactors• Boilers• Machinery• Silk• Mineral fuels• and oils.

• http://business.mapsofindia.com/trade-relations/india-china/#sthash.AYvEKiZp.dpuf

conclusion

• The potential is huge if they work together they could make up to 100 $ million of bilateral trade at the end of 2015.

Sources http://en.wikipedia.org/wiki/List_of_the_largest_trading_partners_of_India

http://articles.timesofindia.indiatimes.com/2014-02-06/india/47089080_1_good-relations-should-india-lee-kuan-yew-school

http://www.dnaindia.com/money/interview-india-and-china-can-benefit-tremendously-by-working-together-1821393

http://rbidocs.rbi.org.in/rdocs/Publications/PDFs/PRSICBT130613.pdf

http://in2.mofcom.gov.cn/article/bilateralcooperation/inbrief/200506/20050600112380.shtml

http://takshashila.org.in/wp-content/uploads/2010/03/PB-AnanthRitwick-IndiaChinaTrade-Sep2011.pdf