Month: November 2024

Australia sets impressive trade records which newsrooms refuse to report

Australians are not good at celebrating good news – and some of the good news they don’t even get to see on major media.

Trade performance is a good example.

Australia has an outstanding national trade body – Austrade – with talented people around the world promoting our products and services.

In many countries – including India – most of our states also have Government offices working hard to build trade and investment.

They have been incredibly successful.

Of the 35 advanced countries in the Organisation for Economic Cooperation and Development (OECD) who reported last year’s exports to the World Bank, only three increased exports relative to gross domestic product (GDP) over 2022.

Of these, Australia’s expansion was the strongest.

The World Bank also affirms Australia’s ascendancy.

The World Bank’s development indicators show export and import outcomes for 138 economies from 1974 to 2023.

The World Bank measured Australia’s 2023 exports at a record 26.7% of GDP.

The success story continues…

Of the 35 advanced OECD member economies for which the World Bank has recorded last year’s export volumes, 17 experienced a decline. These include normally robust economies Ireland, Germany, the United Kingdom, Netherlands and Belgium.

Only 18 increased their exports over the previous year. Just four managed an improvement of more than 5%. Australia ranked third with 6.5% behind Denmark and Costa Rica.

Well done all those Australian providers of quality export goods and services.

Well done, Aussie!

9 reasons India is well placed for the next Trump era

What does the election of Donald Trump as the 47th President of the United States mean for India?

In the past Trump has taken steps to address the US trade deficit with India, like increasing steel and aluminium tariffs, removing GSP benefits, calling out India for high tariffs on motorcycles, dairy, technology items and also pushing for a much more stringent IPR regime.

INTO INDIA provides 9 reasons India is well placed for the next four years of President Trump:

  1. The Indian economy grows due to domestic demand – not trade

    India’s biggest advantage in any global trade war is that it relies much less on trade than most countries – India is flat our trying to meet growing domestic demand, and with a young population this will likely continue.

    But India’s largest trade partners are China and the USA – roughly equal. So, a trade feud between those two will have an impact in India.

    2. India has the advantage of a trade surplus with the USA

    Again, here India is better off than most as it has a trade surplus with the USA.

    3. India is seen as an alternative supplier to China

    Trump’s administration has talked about imposing tariffs of up to 60% on Chinese imports, potentially damaging China’s competitiveness in the US market. In this context, India stands to benefit as an alternate supplier for some of the products where China has dominated in the past, such as electronics, textiles, pharmaceuticals, and more.

    The US imports huge volumes of merchandise from China, such as smartphones, mechanical appliances, toys, furniture, and plastics. India’s share in these sectors is currently low, but the imposition of high tariffs on China could make Indian exports more competitive. For instance, India’s share in the US smartphone market is only 3%, compared to China’s 27%.

    Similarly, the pharmaceutical sector, where India already has a strong export presence, stands to benefit from ‘Trump tariffs’. India’s pharmaceutical exports to the US already account for a considerable share, and with China’s market share likely to shrink, India could see even more demand for its generics and other pharmaceutical products.

    4. Indian renewables might benefit from Trump’s “climate scepticism”

    Another area where India could see an uptick in exports is the renewable energy sector. Trump’s proposal to cut green energy subsidies in the US may create a gap that Indian green energy exporters could fill, particularly with photovoltaic cells used in solar panels.

    5. India has a counter to the 10% tariff challenge

    However, Trump’s proposed universal tariff of 10% on all imports to the US (as mentioned in his recent speeches) could trigger a global trade war, and India’s businesses may find themselves caught in the crossfire.

    But – the economic benefits India stands to gain from trade diversion away from China could well outweigh the costs of universal tariffs.

    6. Indian business optimistic and investing in the US

    Conversely, Indian businesses are optimistic about the favourable business environment in the US under Trump 2.0. For instance, the Aditya Birla Group has expressed intentions to increase its US investments, citing the historically favourable relationship between Trump and India. Trump loves new investment.

    7. India has a friendly investment ecosystem

    Investments are also expected to flow into India. According to a report by The Economic Times, Apple Inc. could boost its iPhone production in India to over $30 billion annually within the next two years.

    Here India’s timing is good – India has developed a strong, investment-friendly ecosystem, making it an appealing destination for global capital. The country’s growing market, skilled workforce, and regulatory improvements position it well to attract more investment, especially as businesses seek alternatives to China.

    8. India has ordered large numbers of US aircraft

    India has another bargaining tool – it makes large aircraft orders, generating jobs in the US, clearly demonstrate why India will be at the Washington DC negotiating tables.

     9. The Trump and Modi friendship runs deep

    Both leaders are seen as outsiders in the establishment of their capitals – New Delhi and Washington DC. Both are anti traditional approaches to governing. Both are often described as alpha – strong – leaders. From my direct experience in India during the first term of Trump – he knows he has a huge fan club in the Indian PM and among Indian businesses.