Walmart-Flipkart deal: NCLAT seeks to know the firms' business model

The National Company Law Appellate Tribunal (NCLAT) has asked US retail major WalMart and e-commerce major Flipkart to explain their way of doing business in India.

NCLAT, which is also an appellate authority over the Competition Commission of India (CCI), has asked Wal-Mart International Holdings Inc to file its reply before it by September 20, 2018.
It has also asked trader's body CAIT, which has filed an appeal before NCLAT challenging the go ahead by fair trade regulator CCI on Walmart's $16 billion acquisition of home-grown Flipkart, to file its understanding over the Walmart's business model in India.
"Before going into the merit of the appeal, we intend to know the manner in which Wal-Mart International Holdings, Inc. and Flipkart Private Ltd do their business in the relevant market in India," said an NCLAT bench headed by Chairman Justice S J Mukhopadhaya.

To balance China in Indian Ocean, India needs to fix its gaze on Africa

India trade with Africa has grown in leaps and bounds over the last decade, but all too often, once official visits and large summits come to an end, the attention New Delhi places on Africa quickly fades.As China’s top-level Africa forum is held in Beijing on September 3 and 4, and India is slated to hold its next triennial Africa summit in the near future, the foreign policy establishment in New Delhi will once again turn its geopolitical gaze west to the African continent. This time, however, India should stay tuned. Africa can no longer be viewed as intermittent and peripheral interest. Instead, Africa must be appreciated as part and parcel of New Delhi’s challenge of recouping lost geostrategic ground from China’s expansionist endeavours on the Indian Ocean. Together, China’s Belt and Road Initiative, to drive trade and finance through Asia, Africa, and Europe, and its encroaching military activities, are serving to redefine India’s relationship with Africa.

Trade war averted: China to buy more from US to slash $200 bn trade deficit

China will “significantly increase purchases” of US goods, the White House said as Beijing’s special envoy at talks in Washington declared a trade war has been averted between the world’s two largest economies.

A joint statement released by the White House following the talks didn’t place a dollar figure on the increased purchases by China, or address a comment by President Donald Trump’s top economic adviser suggesting Beijing had agreed to slash its annual trade surplus with the US by $200 billion.

Vice Premier Liu He, a special envoy of China’s President Xi Jinping, told reporters in Washington that talks with US officials, including Treasury Secretary Steven Mnuchin, Secretary of Commerce Wilbur Ross and US Trade Representative Robert Lighthizer, ended with a pledge not to engage in a trade war, according to a Xinhua news agency report.

Liu said the two sides agreed to stop “slapping tariffs’ on each other, Xinhua reported. Liu said his trip to the US had been positive, pragmatic, constructive and productive. Trade cooperation would be enhanced in such areas as energy, agriculture, health care, high-tech products and finance, a “win-win” choice for both nations.

The left diagnosed ills of globalisation but the right is eating our lunch

Free trade and the freedom of capital to move across borders have been the cutting edge of globalisation. They’ve also led to the succession of crises that have led to the widespread questioning of capitalism as a way of organising economic life — and of its paramount ideological expression, neoliberalism.

The protests against capitalism at the recent G20 meeting in Hamburg may seem superficially the same as those which marked similar meetings in the early 2000s. But there’s one big difference now: Global capitalism is in a period of long-term stagnation following the global financial crisis. The newer protests represent a far broader disenchantment with capitalism than the protests of the 2000s.

Yet capitalism’s resilience amidst crisis must not be underestimated. For trade activists, in particular, who’ve been on the forefront of the struggle against neoliberalism and globalisation over the last two decades, there are a number of key challenges posed by the conjuncture.

Neoliberalism’s surprising strength

First is the surprising strength of neoliberalism.

The credibility of neoliberalism, to which free trade ideology is central, has been deeply damaged by a succession of events over the last two decades, among which were the collapse of the third ministerial of the World Trade Organization in Seattle in 1999, the Asian financial crisis in 1997-98, and the Global financial crisis of 2008-2009, the effects of which continue to drag down the global economy.
READ MORE

How China could use trade to force North Korea to play nice with the West

North Korea got the world’s attention – and President Donald Trump’s – when it said on July 4 that it had successfully launched an intercontinental ballistic missile for the first time. The weapon, potentially equipped with a nuclear warhead, could reach Alaska.

President Trump’s initial reaction included blaming China for letting things get this far. He tweeted that Chinese trade with North Korea “rose 40% in the first quarter,” implying that China is reluctant to punish North Korea for continuing to pursue nuclear weapons.

Is he right to call out China’s trade relationship with North Korea, which formally goes by the Democratic People’s Republic of Korea?

While the poor quality of the data on trade between these countries should lead one to be skeptical of any sweeping claims, Trump’s overall sentiment is probably correct. China has increased its trade with North Korea in recent decades and has likely done very little on that front to try to forestall this trading partner’s nuclear ambitions.

Yet a quick look at the data, however murky, shows just how much leverage China has, if it wishes to use it.

North Korea’s primary patron

In general, exports from one country to another can be mostly explained by the distance between them and the sizes of their markets, a pattern that holds for China and North Korea.

Geographically, they share a large border, which makes China a natural partner for trade. North Korea also abuts South Korea, which doesn’t trade with its rival, and shares a tiny border crossing with Russia, with whom it trades a little (more on that later).
READ MORE

Donald Trump, Angela Merkel to meet ahead of G20 talks

US President Donald Trump and German Chancellor Angela Merkel plan to meet Thursday for what are expected to be tricky talks on the eve of a Group of 20 summit in Hamburg.

Merkel's spokesman Steffen Seibert said the meeting would come before the summit, "most probably in the early evening of Thursday".

The pair are also scheduled to talk by telephone today, Trump said in a tweet.

Transatlantic differences on climate change, trade, defence spending and refugees hang over the July 7-8 meeting of the world's major industrialised and emerging economies.

Last week Merkel met with key European leaders and vowed to make a stand for climate protection and open markets at the meeting with Trump, who has said he will take the US out of the Paris climate deal and pursue a protectionist "America First" policy.

Merkel said that "the differences are obvious and it would be dishonest to try to cover that up. That I won't do."

She also said the US exit from the 2015 Paris climate pact had made Europe "more determined than ever" to make the accord a success.

Today, presenting her party's election platform, she predicted "a whole series of thorny issues" at the G20.

"We know the positions of the US government and I do not expect them to disappear on a two-day trip to Hamburg," the chancellor said.

She warned against high expectations, noting that the summit's final communique has to be "approved unanimously".
READ MORE

Brexit and US trade protectionism: catalyst for India-EU FTA

With the India-EU Free Trade Agreement (FTA) failing to reach a conclusion for a decade now, changed geopolitical circumstances could infuse a sense urgency in striking the deal. Brexit and trade protectionist policies of the US are beginning to play in favour on the deal, according to top representatives of the European Union Parliament in charge of relations with India.

Last week, at the fourth India-Germany Intergovernmental Consultations in Berlin, both Prime Minister Narendra Modi and German Chancellor Angela Merkel, reiterated the need for a successful dialogue for an India-EU FTA. Unlike previous discussions, the call for an FTA this time was more than a rhetoric.

“Since 2007 there has been efforts of FTA between EU and India. There has been a lack of vitality on both sides. Now, there is a bit more willingness to get things moving. One of the incentives has been Brexit. There are a lot of vital interest at stake,” Geoffrey Van Orden, Chair of The European Parliament Delegation for relations with India, told Business Standard.

Notably, Orden, a member of the European Parliament, belongs to the Conservative Party in the UK and is also batting for an India-UK FTA. However, an India-UK FTA is unlikely to be without hitches, for the UK is likely to maintain a tough stand on issues like the movement of people and outsourcing of jobs, hinted Orden.

We will have a UK-India trade relationship based on what we have negotiated with the wider EU. In UK India FTA, India places a lot of importance to transfer of personals. I feel quite sure this will continue, but it will be more controlled as the UK would like to see more highly-skilled people. There will be a reluctance to have unskilled labourers,” said Orden.

One of the demands of the British government was deeper cuts on tariffs on wines and spirits, particularly Scotch Whisky. Even with a tariff of close to 150 per cent, India is the third-biggest export market for Scotch at 41 million bottles, according to data from The Scotch Whisky Association (SWA)

Germany, by far the strongest leaders of the EU, has been pushing for an FTAs at the regional levels in the face of protectionist policies of the US government, as evident from the US pullout from Trans-Pacific Partnership and Paris Accord.
READ MORE

Donald Trump to visit China this year to boost Sino-US ties

US President Donald Trump is likely to visit China this year with an agenda to further improve the economic ties and "reduce conflicts" between the two countries.

The move comes after the US-China relationship showed significant growth after Trump's first ever meeting with his Chinese counterpart Xi Jinping at the former's Mar-a-Lago resort in Florida last month.

Jinping had then told the US president that there were "a thousand reasons" to make the Sino-US ties work and "no reason" to break them.

He had also invited Trump to visit China during the meeting.

"President Trump is looking forward to and hopefully would be able to reach agreement in areas where we have not been able to reach an agreement today for the strengthening of the (US-China) relationship which will again allow us to try and reduce as much conflict and create more economic opportunities for the people," a senior Trump administration official said.

While no date has been fixed for the visit so far, it has been in the discussion stage for quite sometime now.

"It's something that we have been discussing. We have been making progress in our discussion. I think the US-China relationship is right now showing signs of really been stronger than it has been in the long time," the official said on the condition of anonymity.

"I think that stems from the fact that President Trump and President Xi (Jinping) were able to spend a lot of time together (at mar-a-Lago) and find areas where there is a lot of common objectives. I think they have been working together towards those objectives.

"Both are leaders who do not think in short term, but in long term and are trying to create the right framework for the US-China relationship to last for the duration. I would imagine that he would make a trip to China," the official said.

READ MORE