bilateral trade Current Affairs - 2020

9th India-China Financial Dialogue held in New Delhi

The 9th India-China Financial dialogue was held in New Delhi on wide-ranging issues of mutual interest. At the dialogue a high level Chinese delegation led by Zou Jiayi, Vice Minister of Finance, China interacted with Indian delegation led by Atanu Chakraborty, Secretary of Department of Economic Affairs, Union Ministry of Finance.

About India-China Financial Dialogue

Background: India-China Financial Dialogue is a mechanism between India and China with an aim to promote cooperation in financial sector. During this dialogue, both sides have in-depth exchange of views on macroeconomic situation and policy, bilateral investment, cooperation in multilateral framework and financial cooperation. Both countries are also committed towards promoting favorable environment for enabling continuous growth of bilateral trade and investment, strengthening healthier and balanced development of trade and economic cooperation as well as further enhancing partnership between two countries.

In April 2018, India and China bilateral relationship entered into a new era after historic informal Wuhan summit held between Prime Minister of India Narendra Modi and China’s President Xi Jinping.

9th India-China Financial Dialogue

At the conclusion of Financial Dialogue, a joint statement was issued reflecting the mutual understanding and shared vision of both nations to further strengthen cooperation in financial sector.

The 10th India-China Financial Dialogue will be held in China.

US considers withdrawing Generalised System of Preferences from India

The United States is reportedly considering withdrawal of benefits to India under its Generalised System of Preferences amid a widening dispute over its trade and investment policies.

The US Trade Representative (USTR) is in the process of completing the review of India’s status as a GSP beneficiary and an announcement was expected over the next two weeks.

The withdrawal of the Generalised System of Preferences from India could be the strongest punitive action since President Donald Trump took office in 2017 vowing to reduce the US deficit with large economies. The Trump administration has repeatedly called out India for its high tariffs.

Generalised System of Preferences

Generalised System of Preferences instituted in 1976 under the Trade Act of 1974 is a U.S. trade program designed to promote economic growth in the developing world by providing preferential duty-free entry for up to 4,800 products from 129 designated beneficiary countries and territories.

Impact on Trade with India

The withdrawal of the Generalised System of Preferences from India would result in the elimination of duty-free access for about 2,000 Indian product lines. This will hurt small businesses such as jewellery. This will adversely affect Indian exports to the US. After the withdrawal of the Generalised System of Preferences number of goods qualifying for preferential treatment could be reduced, or the whole programme could be withdrawn.