Indian Economy News & Discussion - Nov 27 2017

[anmol]

Is there a Alibaba equivalent in India for Indian companies?

indiamart.com
justdial.com
udaan.com

[Manish_Sharma]

https://tfipost.com/2020/06/3000-items- ... ssion=true

3000 items, Rs 1 lakh crore target – The most powerful body of traders in India prepares to jolt China

Confederation of All India Traders (CAIT), the apex body of trader’s union, has decided to boycott Chinese goods worth more than 1 lakh crore rupees- 13 billion dollars approximately- by December 2021. CAIT has already prepared a list of 3,000 items which includes toys, gifts, FMCG products, confectionery products, cloths and watches, as good indigenously manufactured alternatives of these items are available.

“In the year 2001, the import of Chinese goods into India was only $2 billion, which has now increased to $70 billion, meaning that imports from China increased by 3500 per cent in only 20 years. This clearly shows that under a well thought out strategy, China is trying to gain control over India’s retail market, which Indian businessmen and citizens will not allow to succeed in any case,” said Praveen Khandelwal. Secretary General, CAIT, a body which represents 4,000 trader bodies and more than 7 crore traders across the country.

India imported goods and services worth 65.26 billion dollars from China in FY 20 while the total trade volume stood at 81.6 billion dollars, registering trade deficit of 48.66 billion dollars. This was despite the fact Modi government increased custom on many Chinese good like steel, toys, scooters, and tricycles.

“I must admit it was an error on the part of business community, traders as also the government that we did not look at alternatives earlier which allowed China to become this big. It is high time now and corrective measures are needed,” added Khandelwal.

India has seen repeated calls for boycott of Chinese goods whenever there are border skirmishes, and in the festive seasons like Diwali. But once things are back to normal, it is business as usual, and people become dependent on Chinese goods.

When asked about whether things will go back to normal once the pandemic is over, Khandelwal responded optimistically and said, “It is not the same this time. We know each year during Diwali, the lights that are bought to decorate our homes are made in China. This year, all these lights will be made in India because we will not stock them from across the border at all,” Khandelwal said. “It will not be a Chinese Diwali anymore.”

According to Khandelwal, consumer behavior is already changing due to patriotism and fear, and this will drive the change. “Even in January, much before the lockdown, when the first news of the virus started trickling in, we saw a shift in the purchase decisions of Indian consumers. Chinese goods have an advantage of low cost but they are also low on quality. Consumers today want reliable products and are willing to pay extra for it,” Khandelwal said.

In the last few weeks, tension across the Line of Actual Control (LAC) has also built up, especially in Ladakh. The traders across the country want to make their contribution to national cause by boycotting Chinese goods, and therefore, weakening the country.“They (traders) know that the profits from the products they buy here are used to pay for the Army in China or to support Pakistan which then intrude into our country. So indirectly by buying Chinese goods we are only harming ourselves. The mood is against it today and we as responsible traders need to educate ourselves and the consumers about this,”Khandelwal added.

The boycott of Chinese goods worth 13 billion dollars by December 2020, if successful, would bring down the trade deficit of 48 billion dollars significantly down. The synchronized effort of Indian government and traders would benefit the Indian manufacturers and harm Chinese economy, which is dependent on exports.

[KJo]

India-China trade crashes 7% amid cold vibes - steepest fall in 7 years; monthly deficit at 10-year low

Monthly trade deficit contracting at much faster clip - $1.86 billion in March far cry from all-time high of $5.86 billion in January, 2018
Likely contraction of Indian economy in FY21 may have an even deeper impact on business with China as government pushes for Atma Nirbhar Bharat
China's role in the spread of coronavirus across the world and the economic distress to global economy has caused backlash among business communities and consumers across India
Trade deficit with mainland China now under $50 billion mark for the first time in 5 years. Mainland China was India's largest trade partner until US overtook in FY19
Calls for complete boycott of Chinese products that have risen in India from time to time in the past have become shriller
Traders' body Confederation of All India Traders (CAIT) has called for boycott of 3,000 Chinese products for local substitution

[chola]

^^^ This is as good a time as any to kick the habit. Replace all the disposable goods first and then work out domestic or non-chini supply chains for important stuff (to our industries) like API and electronic parts.

[KL Dubey]

^^^ This is as good a time as any to kick the habit. Replace all the disposable goods first and then work out domestic or non-chini supply chains for important stuff (to our industries) like API and electronic parts.

Yes, I agree. The goremint should start with a list of (say) 100 goods for which import from PBP Republic is banned, and ensure substitution by local production or other imports. Start with low-hanging fruit and keep moving up the chain. Every month expand the list. The "Atmanirbhar Bharat" mission should have an office doing this.

[Sicanta]

https://www.google.com/amp/s/m.economic ... 302412.cms

The Finance Ministry has proposed to decriminalise a host of minor offences, including those relating to cheque bounce and repayment of loans, in as many as 19 legislations to help businesses tide over the crisis caused by the coronavirus outbreak.

Very bad idea, as far as cheque bounce is concerned. If ministry goes ahead with it, they may as well do away with cheques altogether. They wont be worth anything, if the contract between drawer and payee is not sacrosanct anymore.

Another hare brained idea is decriminalizing default by guarantor in case the borrower is unable to/ defaults on loan. In majority of cases, the spouse or nominee in PF/ gratuity is taken as guarantor. So that in case of untimely death of borrower, the spouse is obliged to repay the bank. In other cases, borrower with not so good credit score are provided loans only because a reputed person stands as guarantor, or a business is provided loan only because the proprietor stands as personal guarantor. If they remove this obligation, it will just increase the rate of defaults since proprietor/ partners wont have any skin in the game at all. Many of these future loans will not be sanctioned at all.

Its not as if a criminal case is lodged immediately in case of default. The banks sends a notice giving a minimum of 14 days to regularise the account. If that's not possible due to some genuine reason, the account can be rescheduled.

[disha]

https://www.google.com/amp/s/m.economic ... 302412.cms

The Finance Ministry has proposed to decriminalise a host of minor offences, including those relating to cheque bounce and repayment of loans, in as many as 19 legislations to help businesses tide over the crisis caused by the coronavirus outbreak.

Very bad idea, as far as cheque bounce is concerned. If ministry goes ahead with it, they may as well do away with cheques altogether. They wont be worth anything, if the contract between drawer and payee is not sacrosanct anymore.

Sicanta'ji, I agree with you on the cheque bounce part. Cheques were used as in instrument to stave out creditors.

However I disagree with you on guarantor part. In fact this whole concept of guarantor should be done away with. I had personal experience where the guarantor himself ends up in jail because the borrower took a risk and did not pan out. It scars everybody for the rest of life. Our financial and industrial development markets and processes needs to evolve better.

[Sicanta]

Please no ji.

Now as far as legitimate business risks are concerned, provisions have been made to provide institutional guarantee for such businesses, upto a certain loan amount. Like in mudra, upto Rs 10 lakhs. This is provided by CGFMU. https://www.ncgtc.in/en/products-n-services/cgfmu After that, upto Rs 200 lakhs, comes CGTMSE. https://www.cgtmse.in/

So banks don't insist on collateral or third party guarantee in most cases. Only borrower stands as guarantee for his business.If loans turn NPA, banks claim the guarantee amount from either institution. They will certainly pursue the borrower for repayment (They are obliged to do so by these institutions otherwise they wont pay up) but the borrower gets benefit in the form of access to credit he otherwise would not have got due to lack of sufficient collateral or guarantee.

[Ambar]

Businesses will always adjust to the market reality. If the government proceeds to decriminalize cheque bounce then the receiver will insist on either cash or demand draft. What will happen however is that it will slow the business further as many buyers write a post-dated cheque based on their future cash flow and that may no longer be possible.

[Yagnasri]

As far as Guarantor is concerned ( or even the borrower) mere default does not amount to a crime. Something else which is actually a crime under the law shall be committed. That is the law.

Suspension of Criminal liability under 138 of the NI Act (Check dishonour cases) is required for the time being. The reason is this crime does not require proof of criminal intent ( mens rea in Latin) for conviction. Added to that the burden of proof in respect of some aspect of the case is also with the issuer as per the provisions. Many checks will be now dishonoured due to the reasons which are beyond the control of the issuer due to present i.e COVID 19 conditions. So it would be better to suspend the provisions, for the time being, would be good.

[Vadivel]

In last 5 yrs cheques have reduced to 10% of overall transactions, i get 1 cheque a month now instead of 10, and generly force clients to pay via IMPS/NEFT.

Its better to remove the cheques as an instrument, lots of overheads for banks as well as administrative cost for companies (courier, deposit in banks, if lost, go into replacing it etc.)

[nandakumar]

As far as Guarantor is concerned ( or even the borrower) mere default does not amount to a crime. Something else which is actually a crime under the law shall be committed. That is the law.

Suspension of Criminal liability under 138 of the NI Act (Check dishonour cases) is required for the time being. The reason is this crime does not require proof of criminal intent ( mens rea in Latin) for conviction. Added to that the burden of proof in respect of some aspect of the case is also with the issuer as per the provisions. Many checks will be now dishonoured due to the reasons which are beyond the control of the issuer due to present i.e COVID 19 conditions. So it would be better to suspend the provisions, for the time being, would be good.

I recall reading a court ruling that where post-dated cheques are obtained at the time of a transaction (loan/purchase of durables) and there is a default then criminal liability is not attracted. On a broader note, the imprisonment penalty was imposed because negotiation of instruments is at the heart of commerce and growth in commerce promotes economic welfare within the society. So it was some kind of trade off between individual liberty and common good.

[Vips]

Explained: Why India’s forex reserves are rising, what this means for the economy.

India’s forex reserves crossed $500 billion for the first time ever in the week ended June 5, 2020. Unlike in 1991, when India had to pledge its gold reserves to stave off a major financial crisis, the country can now depend on its soaring foreign exchange reserves to tackle any crisis on the economic front. While the situation is gloomy on the economic front with GDP set to contract for the first time in 40 years and manufacturing activity and trade at standstill, this is one data point that India can cheer about amidst the Covid-19 pandemic. While it jumped by $8.2 billion in the week ended June 5, 2020, it is important to note that since the announcement of lockdown in March, it has surged by $31.8 billion. Hitting an all-time high of $501.7 billion as on June 5, 2020, India has come a long way since its forex reserves of $5.8 billion as of March 1991.

What are forex reserves?
Forex reserves are external assets in the form of gold, SDRs (special drawing rights of the IMF) and foreign currency assets (capital inflows to the capital markets, FDI and external commercial borrowings) accumulated by India and controlled by the Reserve Bank of India. The International Monetary Fund says official foreign exchange reserves are held in support of a range of objectives like supporting and maintaining confidence in the policies for monetary and exchange rate management including the capacity to intervene in support of the national or union currency. It will also limit external vulnerability by maintaining foreign currency liquidity to absorb shocks during times of crisis or when access to borrowing is curtailed.

Why are forex reserves rising despite the slowdown in the economy?
The major reason for the rise in forex reserves is the rise in investment in foreign portfolio investors in Indian stocks and foreign direct investments (FDIs). Foreign investors had acquired stakes in several Indian companies in the last two months. According to the data released by RBI, while the FDI inflow stood at $4 billion in March, it amounted to $2.1 billion in April.

After pulling out Rs 60,000 crore each from debt and equity segments in March, Foreign Portfolio Investments (FPIs), who expect a turnaround in the economy later this financial year, have now returned to the Indian markets and bought stocks worth over $2.75 billion in the first week of June. Forex inflows are set to rise further and cross the $500 billion as Reliance Industries subsidiary, Jio Platforms, has witnessed a series of foreign investments totalling Rs 97,000 crore.

On the other hand, the fall in crude oil prices has brought down the oil import bill, saving precious foreign exchange. Similarly, overseas remittances and foreign travels have fallen steeply – down 61 per cent in April from $12.87 billion. The months of May and June are expected to show further decline in dollar outflows.

The sharp jump in reserves seen over the last nine-months started with the finance minister, Nirmala Sitharaman’s announcement to cut corporate tax rates on September 20. Since then the forex reserves have grown by $73 billion.

What’s the significance of rising forex reserves?
The rising forex reserves give a lot of comfort to the government and the Reserve Bank of India in managing India’s external and internal financial issues at a time when the economic growth is set to contract by 1.5 per cent in 2020-21. It’s a big cushion in the event of any crisis on the economic front and enough to cover the import bill of the country for a year. The rising reserves have also helped the rupee to strengthen against the dollar. The foreign exchange reserves to GDP ratio is around 15 per cent. Reserves will provide a level of confidence to markets that a country can meet its external obligations, demonstrate the backing of domestic currency by external assets, assist the government in meeting its foreign exchange needs and external debt obligations and maintain a reserve for national disasters or emergencies.

In his monetary policy statement on May 22, RBI Governor Shaktikanta Das said, “India’s foreign exchange reserves have increased by US$ 9.2 billion in 2020-21 so far (up to May 15) to US$ 487.0 billion – equivalent to 12 months of imports.”

What does the RBI do with the forex reserves?
The Reserve Bank functions as the custodian and manager of forex reserves, and operates within the overall policy framework agreed upon with the government. The RBI allocates the dollars for specific purposes. For example, under the Liberalised Remittances Scheme, individuals are allowed to remit up to $250,000 every year. The RBI uses its forex kitty for the orderly movement of the rupee. It sells the dollar when the rupee weakens and buys the dollar when the rupee strengthens. Of late, the RBI has been buying dollars from the market to shore up the forex reserves. When the RBI mops up dollars, it releases an equal amount in rupees. This excess liquidity is sterilised through issue of bonds and securities and LAF operations. “Despite the global dollar weakness, the RBI does not seem to be keen to step off the gas as far as reserve accumulation is concerned… the sentiment in the rupee has been skewed by incessant dollar purchases by the central bank to strengthen its balance sheet,” said Abhishek Goenka, CEO, IFA Global.

Where are India’s forex reserves kept?
The RBI Act, 1934 provides the overarching legal framework for deployment of reserves in different foreign currency assets and gold within the broad parameters of currencies, instruments, issuers and counterparties. As much as 64 per cent of the foreign currency reserves are held in securities like Treasury bills of foreign countries, mainly the US, 28 per cent is deposited in foreign central banks and 7.4 per cent is also deposited in commercial banks abroad, according to the RBI data.

India also held 653.01 tonnes of gold as of March 2020, with 360.71 tonnes being held overseas in safe custody with the Bank of England and the Bank for International Settlements, while the remaining gold is held domestically. In value terms (USD), the share of gold in the total foreign exchange reserves increased from about 6.14 per cent as at end-September 2019 to about 6.40 per cent as at end-March 2020.

Is there a cost involved in maintaining forex reserves?
The return on India’s forex reserves kept in foreign central banks and commercial banks is negligible. While the RBI has not divulged the return on forex investment, analysts say it could be around one per cent, or even less than that, considering the fall in interest rates in the US and Euro zone. There was a demand from some quarters that forex reserves should be used for infrastructure development in the country. However, the RBI had opposed the plan. Several analysts argue for giving greater weightage to return on forex assets than on liquidity thus reducing net costs if any, of holding reserves.

Another issue is the high ratio of volatile flows (portfolio flows and short-term debt) to reserves which is around 80 per cent. This money can exit at a fast pace. There are some differences among academics on the direct as well as indirect costs and benefits of the level of forex reserves, from the point of view of macro-economic policy, financial stability and fiscal or quasi-fiscal impact, former RBI Governor YV Reddy said in one of his speeches.

[Suraj]

So Indian forex reserves finally cross the $500 billion mark , finishing at close to $502 billion for the latest reported week (all forex data is reported with a 1 week lag). Feels as momentous as when it first crossed $100 billion, but less celebratory and more a sense of significant power status.

There are only 5 countries in the >$500 billion group - China, Japan, Switzerland, Russia and India. Only 6 countries have ever had reserves of at least $500 billion at any time historically - Saudi Arabia had $740 billion at the peak of the petroleum price rise, but are now down to the mid $400 billion level.

Unlike China and Japan we are not major exporters. Unlike Russia and KSA, we have no hydrocarbons surfeit. Unlike Switzerland, we aren’t a wealth and tax shelter. We are the one that make people go “India ?? They have half a trillion in hard currency reserves ? What the cluck ?” By 2025 I expect we will be the third country ever to breach $1000 billion in forex reserves.

Code: Select all

1 China	3,101,692
2 Japan	1,378,239
3 Switzerland	848,398
4 Russia	565,200
5 India	501,703
6 Taiwan	484,520
7 Saudi Arabia	448,150
8 Hong Kong	442,300
9 South Korea	407,300
10 Brazil	345,700

[RKumar]

Explained: Why India’s forex reserves are rising, what this means for the economy.


India also held 653.01 tonnes of gold as of March 2020, with 360.71 tonnes being held overseas in safe custody with the Bank of England and the Bank for International Settlements, while the remaining gold is held domestically. In value terms (USD), the share of gold in the total foreign exchange reserves increased from about 6.14 per cent as at end-September 2019 to about 6.40 per cent as at end-March 2020.
.

Why? Why? Why? Why? Why? Indian gold is kept in England? What are the benefits, India getting from there? GoI, must bring this gold back to India as of yesterday. Our precious is used by England for its pride and economic growth.

[kit]

So Indian forex reserves finally cross the $500 billion mark , finishing at close to $502 billion for the latest reported week (all forex data is reported with a 1 week lag). Feels as momentous as when it first crossed $100 billion, but less celebratory and more a sense of significant power status.

There are only 5 countries in the >$500 billion group - China, Japan, Switzerland, Russia and India. Only 6 countries have ever had reserves of at least $500 billion at any time historically - Saudi Arabia had $740 billion at the peak of the petroleum price rise, but are now down to the mid $400 billion level.

Unlike China and Japan we are not major exporters. Unlike Russia and KSA, we have no hydrocarbons surfeit. Unlike Switzerland, we aren’t a wealth and tax shelter. We are the one that make people go “India ?? They have half a trillion in hard currency reserves ? What the cluck ?” By 2025 I expect we will be the third country ever to breach $1000 billion in forex reserves.

Code: Select all

1 China	3,101,692
2 Japan	1,378,239
3 Switzerland	848,398
4 Russia	565,200
5 India	501,703
6 Taiwan	484,520
7 Saudi Arabia	448,150
8 Hong Kong	442,300
9 South Korea	407,300
10 Brazil	345,700

Doesnt it mean we are hoarding uncle's debt.. with the khans printing presses working overtime, the real value of the hoard might be less

[Suraj]

Only $150 billion of the forex reserves is in US treasury securities.

https://ticdata.treasury.gov/Publish/mfh.txt

[Suraj]

Forex reserves pt 2

After the collapse of the gold standard, exchange rates were floated freely. Theoretically this should mean a lesser need to accumulate foreign exchange reserves in a reserve currency, but the opposite happened. There were some catalysts for this, especially in the 1990s and later:

1. Global trade and capital flows are unbalanced.

A few countries are huge players, both in trade and investment. Japan ran massive trade surpluses and accumulated reserves to keep the yen down. They accumulated incredible amounts of wealth in that era - the ubiquitous Japan Post Bank has ~$2-2.5 trillion in deposits. The OPEC nations accumulated huge surpluses during the 1970s oil price shock, while UK and EEU ran big deficits. Some major geopolitical actions occured in this context. The Al Yamamah arms deals between UK and KSA are an agreement to exchange oil for weapons instead of cash. Turn of the century saw PRC become a leading trade pole, and also depend on a fixed peg to the dollar, thereby accumulating reserves.

2. The Asian Financial Crisis

Until this crisis , hot money contagion wasn't a major issue in E/SE Asia. India to a limited extent also grew in the late 1980s due to the pre-liberalisation hot money inflows, which changed direction by end of decade and led to the 1991 crisis. The ASEAN/Asian Tigers were similarly addicted to hot money in the 1990s, ending in the crisis. The movie Default is a great story of this from Korea - it's on Netflix. The crisis also relates to two forms of convertibility:
a) current account convertibility : any entity involved in trade can convert unlimited amounts of the country's currency to another trading currency at market rates . India has this, and most major trading nations do.
b) capital account convertivility: an entity involved in domestic equity/debt market investment can convert unlimited amounts of the country's currency to/from another. Not present in most of Asia, including India, China and E/SE Asia.

The problem with capital account convertibility is that hot money can enter/exit with a mouse click. Restrictions force that money to stay within the country for a cooling off period or any other constraint. Without such restrictions, there can be a rapid deterioration of macroeconomic situation if vast amounts of foreign capital come in, causing asset bubbles, and then exit, causing a crash. At least current account convertibility is backed by goods being exchanged.

More to come...

[csaurabh]

Is there a Alibaba equivalent in India for Indian companies?

indiamart.com
justdial.com
udaan.com

^^
I agree that these websites exist and fulfil some purpose. But please they are not equivalent to Alibaba.
It is like saying a college football team is equivalent to Manchester United.

[Suraj]

indiamart.com
justdial.com
udaan.com

^^
I agree that these websites exist and fulfil some purpose. But please they are not equivalent to Alibaba.
It is like saying a college football team is equivalent to Manchester United.

Maybe, but that’s not a helpful response. What enabled Alibaba to become the entity it is ? How did all the pieces come together in that case ? What are the specific pieces missing in the Indian context ? If you can articulate that at length in an informative manner, then that would be more useful .

[mukkan]

This is about an industry where China has been beaten by India. It has been shown that it’s not the government, neither the people; it’s really the companies that compete.

In 2005, Chinese motorcycles attacked India with products which were 30 percent cheaper. Many dealers started selling them. Press predicted demise of Indian manufacturers. But within six months they went broke. Their quality was no match to Indian motorcycles. They never came back again.

In 2018 India became the largest manufacturer of two wheelers in the world (producing twice more than China). Indian companies have started buying out European brands. The market leader of motorcycles in Europe is not BMW, its KTM, which is part-owned by Bajaj. China is slipping fast not only in the manufacturing of bikes, but also in the manufacturing of components. Indian suppliers are beating them hands down. Between three Indian companies—Hero, Bajaj and TVS—India today dominates the world motorcycle market.

So who is responsible for the Chinese dominance—the government, people or the corporates?

I think it’s all the three. When even ITI-trained turners and fitters refuse to work in a shop floor, when a stock broker is paid more than an engineer, when typing code is mistaken for technology, when governments refuse to amend antique labour and land laws, when corporates think local and not global, and finally when you, yes you the reader, will not send your son or daughter to work on the shop floor, each one of these factors is as responsible for the Chinese dominance as as their “ethical corruption”. We have been looted because we left our doors and windows open.

No, this article is not supporting the Chinese. How dare they work so hard? And how dare they obey a communist government? We should stop buying all their goods and we will make everything in our country. But we will work nine to five with a three-day weekend. We will overcome. One day.

https://www.cnbctv18.com/views/how-one- ... 135001.htm

[yensoy]

^^^^ Yeah this has been making the rounds on whatsapp.

Fact is that the Chinese have moved on to electric bikes, cars and in particular electric cars. So it's great that the motorcycle industry did a great job of competing with the Chinese and brought some much needed improvements to our industrial infrastructure, mindset and global mindshare - however we need to be not where the ball is but where the ball is going.

[mukkan]

Author doesn't mention about collaboration or joint venture all of them had with Japanese companies. Bajaj Kawasaki, TVS Susuki, Hero Honda during 90s. Helped them learn and become market leaders later.

[Ambar]

Yes, infact when Royal Enfield after using BSA designed motor for 50+ years decided its time to upgrade to meet BS2 emission norms, they went to AVL of Austria instead of designing a motor inhouse. Most of the 100-150cc engines used by TVS, Hero and Bajaj trace their lineage to the time when they had Japanese partners. Japan and Korea too developed their engineering by partnering with western companies but at the same time they were making massive investment on domestic R&D that many Indian companies have failed to do.

Some 10 years ago i was in a car show in one of the US east coast cities and was pleasantly surprised to see a gentleman with an early 60s Fiat 1100. It brought back memories of my dad's Premier Padmini cars, the last one of which he purchased in early 90s. Upon close inspection of the instrument cluster and looking at the motor under the open hood, i realized how similar the 90s Indian Premier Padmini was to its 1960s grandmother from Italy ! Heck ! Premier Auto Ltd(PAL) had not even changed the color of the metal air filter housing, the 1960s Italian car had the exact light green metal housing as the 90s Indian car ! PAL literally kept printing the same car with 0 investment on R&D for 40 years even after the licensing agreement ran out.

[Mollick.R]

X-post from border thread........

Telecom Ministry orders BSNL, MTNL and private companies to ban all Chinese deals and equipment
India TV News Desk New Delhi Updated on: June 17, 2020 22:35 IST

The Telecom Ministry has ordered BSNL, MTNL and other private companies to ban all Chinese deals and equipment. Old tenders will be cancelled and China won't be allowed to participate, sources said.

The move comes amid anger in the country after killing of 20 Indian soldiers at the LAC in Galwan Valley in Eastern Ladakh on Monday night. The relations between India and China have further soured after the incident this week. Anger has been simmering in the country ever since, with many calling for boycott of Chinese products and apps.

Meanwhile, the Confederation of All India Traders (CAIT) called for boycott of Chinese goods, listing 450 imported items including cosmetics, bags, toys, furniture, footwear & watches. The objective is to reduce the import of Chinese finished goods by $13 billion or about Rs 1 lakh crore by December 2021, CAIT said.

The Swadeshi Jagran Manch today demanded that Chinese companies be banned from participation in the tender process in the country. It also demanded the cancellation of the lowest bid made by China's Shanghai Tunnel Engineering Co Ltd for the construction of an underground stretch of the Delhi-Meerut Regional Rapid Transit System project.

Earlier on Wednesday, India delivered a strong message to China that the "unprecedented" incident at the Galwan Valley will have a "serious impact" on the bilateral relationship. It also held the "premeditated" action by Chinese army directly responsible for the violence.

https://www.indiatvnews.com/news/india/ ... ent-627052

[Mollick.R]

India restricts tyre imports - government order
AUTO & TRUCK MANUFACTURERS JUNE 12, 2020 / 9:25 PM / 5 DAYS AGO

NEW DELHI, June 12 (Reuters) - India on Friday restricted tyre imports across categories of pneumatics and radials used in buses and motorcyles, the federal government said in a notification.

For full link to circular, please see: bit.ly/37q7qF8(Reporting by Neha Arora; Editing by Kevin Liffey)

Reuters
https://www.reuters.com/article/india-t ... SL4N2DP3A2


New Delhi: The government on Friday restricted tyre imports across categories of pneumatics and radials used in buses and motorcycles, it said in a notification.
NDTV (Sorry for quoting them)
https://www.ndtv.com/business/import-ba ... rs-2245618

[Suraj]

Disclaimer: I'd like to keep emotions regarding the ongoing conflict situation out of this thread and focus on the economics.

The Governments actions on the economic situation so far have been very good. I'd like them to go further and punitively ban imports of the highest value Chinese items. This is one reason why I requested earlier for data on what exactly are the itemwise /dollarwise breakdown of the imports from China. It is really irrelevant whether our actions contravene WTO rules. They can challenge it, and we are free to lose the case... years of challenges and obfuscation from us later.

The positive of the trade imbalance in a situation like this is that India is in a position to place of cost in the tens of billions per year here, and comparatively far lower cost to us. The government is acting rationally.

[Vayutuvan]

They can challenge it, and we are free to lose the case... years of challenges and obfuscation from us later.

Would we be subject to punitive damages running into billions in that case?

[Suraj]

The WTO doesn't have the authority to enforce damages, and neither does China. "Stop doing that" is the extent of it. When was the last time anyone had to pay billions on a WTO judgment ? Let's say Beijing sent us a bill for $100B . GoI takes it and tears it up and drops it at their feet. What happens next ? Nothing. It's their job to prove the value of opportunity cost. We'll simply say "these new Indian companies produced much better products and the Chinese companies lost business."

There's no enforcement mechanism to redress past actions. The Chinese have 2 decades of accumulated state subsidisation, IP theft, currency manipulation, and mercantilism. How much have they had to pay in punitive damages ? Right, nothing.

That is the nature of the trade imbalance - Beijing is welcome to retaliate against Indian exports. They'll run out of things to retaliate for a long long time before we're done. About $60 billion before we're done...

[Vayutuvan]

Similar to ICJ and other useless busybodies. It is ironic that we (India) supported China's membership to WTO.

[mukkan]

Found this website that can be used to find quantity of imports not just the dollar amount that is available everywhere

http://www.indiatradedata.com/

A Provider of Business intelligence Report based on India Import & Export Trade
IndiaTradeData.com is the trustworthy platform to track every shipment, which comes in or goes out from India via sea, air or road. We provide the latest and most accurate India import export data that are based on Trade Bills, Bill of Entry, Shipping Bills, Bill of Lading, Invoices and other import export customs documents. Through our India trade data, we create business intelligence reports that are helpful for any kind of businesses to always be ahead from competitors.

Example of details of 8517 code (mostly smart phones)

http://www.indiatradedata.com/import-da ... china.html


Analysis of import of 2016
http://www.indiatradedata.com/what-indi ... port-china

[csaurabh]

Maybe, but that’s not a helpful response. What enabled Alibaba to become the entity it is ? How did all the pieces come together in that case ? What are the specific pieces missing in the Indian context ? If you can articulate that at length in an informative manner, then that would be more useful .

Since you asked..
As a user of aliexpress and indiamart over last few years, I think I am qualified to answer. I would divide my response into 3 parts:

1.) Purpose

One has to understand the circumstances under which e-commerce emerged and that is with the growth of the internet. At that time, the Chinese were already a manufacturing superpower. They already had the infrastructure, logistics, legalities, etc. all worked out. All that was needed was to hook this (offline) already smooth running engine to the internet.

India had none of these things, and barely has them even now. To cover up this shabbiness, we had an 'importing and middleman' bania industry which bought stuff from abroad (including China), and sold them at slightly higher profits and called it as providing 'services'. So when e-commerce rolled around, it was this importing/middleman and low quality manufacturing industry that got hooked to the internet.

Thus, while the main purpose of Alibaba and co. is to export Chinese made goods around the world ( and in their own country ), the main purpose of Indiamart and co. is to import foreign made ( often from China ) goods into the Indian market. This might be slightly exaggerated- Alibaba does sell products from foreign companies after all. But many of these companies (MNC) manufacture in China itself. And these MNCs sell to India as well. The reverse ( buying Indian made goods in China ) would be quite laughable.

So if in the end you are going to buy the Chinese manufactured product, why not cut out these middlemen and just buy straight from Alibaba itself? That is where I think Indian ecommerce players lack purpose.

2.) Functionality

The 'ecommerce' facility on Indiamart is minimal. All it does really is list products and companies with phone numbers. After this you can contact these companies, get quotes, select one , raise a purchase order, receive proforma invoice. GST filing and accounting has to be taken care of by both sides. Shipment is done by commercial courier, and you and the company are responsible for taking care of it. Bank transaction has to be done by depositing money into the respective account. There is no oversight on any of this and nowhere to open a grievance if anything goes wrong. Really quite primitive.

In contrast Aliexpress has a simple 'buy' button after which you make the payment. That's all, really. They will take care of shipment. You can track your orders. You can open a dispute if you didn't get what you ordered. Also, the descriptions posted for any item on Aliexpress website are massive and comprehensive. They have the product viewed from 360 degrees at high resolution, give a complete description of electrical and mechanical specifications, and have complete traceability from the company making it. The only thing is that it may take some time to arrive. And there could be some extra customs duty and you have to have IEC ( Import export clearance ) and list it under imports. But these are problems at our end only, not on their end.

Rather than providing a useful service, all Indiamart does is make random irritating calls asking sir do you have a requirement for this or that product. Its quite aggravating.

3.) Aesthetics

This might be a minor thing to bug bout. But really the look and feel of Indiamart is UGLY. It doesn't work properly on mobile. There are random pop-ups and ads. It is like the internet equivalent of paan-chewing sarkari babus.

Contrast that with Aliexpress. Crisp, clean, first world aesthetics. Nothing is confusing, and yes, everything is in English. It is a pleasure to use the interface.

To sum up: The gap between the two is so large that I don't think it can be bridged anytime soon. And there are alternatives such as Industrybuying.com but these are hardly any better. For all our so called 'world class' IT services, we haven't been able to come up with a functional B2B ecommerce site yet. But one can always hope.

[anmol]

Why are you comparing Indiamart (B2B) to Aliexpress (B2C) ?

[jpremnath]

I do hope Indiamart gets it act together. They have enough mindshare and quite a good number of manufacturer listings. And I have noticed there are plenty of indian manufacturers for most items. Hopefully sooner or later they will improve the interface and functioning ready to ride the manufacturing wave in the country.

[csaurabh]

Why are you comparing Indiamart (B2B) to Aliexpress (B2C) ?

Alibaba/Aliexpress is both B2B and B2C. Technically Alibaba is for B2B and Aliexpress is for B2C but unless you are ordering very expensive things or in large numbers, Aliexpress does B2B just fine.

[ankitash]

Udaan is India's premier B2B platform. Not indiamart

It's by ex-Flipkart people. Has a slick UI etc

[anmol]

Technically Alibaba is for B2B and Aliexpress is for B2C but unless you are ordering very expensive things or in large numbers, Aliexpress does B2B just fine.

Or really heavy or big things, anything which may require dealing with customs, anything requiring after sales support (training, installation activities, maintenance, etc.), also there are no proper invoices for any order...

Aliexpress Taobao Wishstore etc. and other online stores should not be compared to Indiamart.

The 'ecommerce' facility on Indiamart is minimal. All it does really is list products and companies with phone numbers. After this you can contact these companies, get quotes, select one , raise a purchase order, receive proforma invoice. GST filing and accounting has to be taken care of by both sides. Shipment is done by commercial courier, and you and the company are responsible for taking care of it. Bank transaction has to be done by depositing money into the respective account. There is no oversight on any of this and nowhere to open a grievance if anything goes wrong. Really quite primitive.

Please visit --> https://paywith.indiamart.com/

[csaurabh]

Or really heavy or big things, anything which may require dealing with customs, anything requiring after sales support (training, installation activities, maintenance, etc.), also there are no proper invoices for any order...

Aliexpress Taobao Wishstore etc. and other online stores should not be compared to Indiamart.

And you do not need any ecommerce website for that. You contact the company in question and make a deal with them directly.
In any case what's your argument here? We can compare Alibaba to Indiamart. Even though I have not used Alibaba I can assure you that it is far far far ahead of Indiamart.

Indiamart's payment options are quite lousy. I see no sense in using them and frankly I don't trust them. '

Udaan is India's premier B2B platform. Not indiamart

It's by ex-Flipkart people. Has a slick UI etc

Udaan is a retailer platform. That does not qualify as B2B in my opinion. Does look rather good though.

[nam]

Actually the more noise people make about not buying Chinese made stuff, companies will be forced to move some of the production to India ...or loose market.

Any company will not like to have negative publicity for it's products in a 1.3B market .. because it is made in China.

Just like companies have moved production to US or out of market to deal with US trade war. We just need to make a trade war of our own.

Boycotting Chinese should be become more prominent.

[anmol]

And you do not need any ecommerce website for that.
You contact the company in question and make a deal with them directly.

Well if I am looking for a vendor who can supply me X, IndiaMart (and Alibaba) can get me in touch with all the listed vendors who can supply X to my business, are meeting my specification and price range. It would be far easier to do this on Indiamart or similar platform.

In any case what's your argument here? We can compare Alibaba to Indiamart. Even though I have not used Alibaba I can assure you that it is far far far ahead of Indiamart.

Yes we should compare Alibaba to Indiamart. Aliexpress should be compared to other stores like Taobao WishStore Gearbest Banggood etc.

Indiamart's payment options are quite lousy. I see no sense in using them and frankly I don't trust them.

What is lousy about the payment system ?