NEW DELHI: India has identified 151 products that it can export to China instead of the US and benefit from the price advantage thrown up by the retaliatory higher duties slapped by the Xi Jinping government on US products amid the intensifying trade war between the two countries.

These include diesel engines, X-ray tubes, antibiotics, copper ores, granite, xylene, inverter and ketones, said people with knowledge of the matter.

This comes in the wake of the US terminating preferential benefits to $6.35 billion of Indian exports and India deciding to raise import tariffs on 29 goods originating in the US. “There are more than a hundred lines in which India has the potential to replace the US exports to China as it has market access and is a competitor of the US,” said an official aware of an internal study by the Department of Commerce to identify such products.

The government has also identified 531 product lines in which US imports from China and India’s exports to the world are significant. Out of these, India has the potential to replace Chinese exports to the US as it has market access and is a competitor of China in 203 lines.

China has slapped a higher duty of 5-25% on most chemicals coming from the US compared with the tariff of 2-7% levied on Indian chemicals.

Copper concentrates, granite, xylene and inverters are the key American products on which China has levied 25% duty while products of reclaimed rubber and parts of taps are in the 20% tariff category since June 1.

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India and China, two of the fastest-growing markets in the world, are members of the Asia Pacific Trade Agreement and are negotiating the Regional Comprehensive Economic Partnership trade pact with 14 others. “The ongoing retaliatory tariffs provide a window of opportunity for enhancing India’s exports to China,” the official said.

The 151 products identified by India are part of a list of 774 such items where the country sees scope for higher exports. These 774 product lines are those in which China’s imports from the US are substantial and so are India’s exports to the world.

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Besides, there are more than 600 other products in which market access with China will be vigorously pursued, said the official.

India has prepared a strategy to gain market access in China for its farm and pharmaceutical exports and attract foreign companies looking to shift their manufacturing bases out of the country in the wake of the trade war between the US and China. India’s trade deficit with China stood at a record $53.6 billion in FY18.

“There is potential to export more xylene and benzene to China,” said a Mumbai-based exporter of organic and inorganic chemicals, who did not wish to be identified. “However, these are bulk chemicals in liquid form wherein all kind of logistics are important including timely availability of steamers. High costs of freight and electricity too are issues, which if resolved, will help us export more.”





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