Indian Economy

[asaada]

Because they have left the EU, are getting bitch-slapped by the burgerboys as we speak and in dire need of reliable trade/econ partners. Going back to the ccp fold is a big no so that leaves only us to chime in. And the UK does not even have a meaningful industry to maufacture and export back to us - at best they will export some whiskey and a bunch of high end stuffs (that we do not manufacture in house anyway).

So signing an FTA should not take much time, ideally. The negotiations are stuck because pappu Goyal is adamant on demanding more 'people-to-people mobility' (ie, more body bags/TCS-infy IT coolie visas) which the Brits are reluctant to give in to.

We do not abuse Goyal enough.



Deal with USA is way more challenging, they would demand an end to our agri subsidies and ask to compromise on our food security, demand concessions on finished cars etc. Read up my old posts on this thread.



Yeah, and clown Goyal thinks so too. Which is precisely why he is not willing to sign a deal unless they roll over and beg in front of him.



An FTA with the UK is not even comparable here. Those FTAs (with ASEAN, Jap, Kor) were signed because of geopolitical calculations (MMS and Maino were retarded enough to yield FTAs as a carrot) - not the case with the pacts we are negotiating right now.



Market access to a major economy with very little reciprocity in trade (they have little to no domestic industry so won't flood our markets with cheap goods). Even their agri sector is not that big (the usual point of contention whenever we negotiate an FTA).

EDIT: Modi's own EACPM members have been arguing in favor of an FTA with UK, btw.

I believe It’s abundantly clear that the British side is the one dragging its feet in these FTA negotiations. Largely due to their domestic political mess.

The push for more visas in the FTA, serves as valuable bargaining leverage. Beyond our pharmaceutical and diamond exports, we lack industries that can consistently outcompete local players abroad. Meanwhile, the EU and New Zealand often uses their stronger position to threaten our domestic food security by demanding the removal of all tariffs on agriculture and dairy. These visas give us leverage to push back against those demands. Not to mention, our IT coolies are one of the biggest sources of remittances and a practical way to offset unemployment in the country, so I don’t see this as a bad strategy to lean on. To deny them the opportunity to exploit our weaknesses.

The UK in particular is desperate for a market for their automobile sector, so these IT visas serves a good enough way to tackle their demands, while keeping our local players protected.

While I agree that MMS and Maino were utterly incompetent, I think you’re underestimating the impact of non-trade barriers that fueled those trade deficits. ASEAN, in particular, exploited weak rules of origin to dump Chinese goods into our market. If we aren’t careful, the Brits and Europeans could pull a similar stunt under the guise of environmental sustainability (carbon tariffs) and compliance costs take us for another ride.

 

[eastern_bhartiya]

Those are the kind of fancy buzzwords they throw in whenever they are in the process of drafting a new deal. Even the Paris agreement had some similar jargons thrown in here and there.

The negotiations are stuck because Goyal wants to ship more TCS/Infy coolies, go through the ET/HT articles. The remaining points of contention are manageable.

India, UK resume trade negotiations: The potential flashpoints | India News - The Times of India

India News: India and the UK resumed their FTA talks to boost the GBP 42 billion annual bilateral trade. The discussions, paused due to elections, aim to address

timesofindia.indiatimes.com

This ORF article contains some more details;

The India-UK FTA: Finally coming to fruition?

The India-UK FTA: Finally coming to fruition?

www.orfonline.org

Why exactly Goyal and co are so afraid of their banking and legal services grabbing 1% market share is something I will never understand.

why are we insisting on sending more of our people there, given situation in west and propaganda against Indians, shouldn't we be staying away from it.

 

[shuturmurg]

why are we insisting on sending more of our people there, given situation in west and propaganda against Indians, shouldn't we be staying away from it.

Because our govt. has given up on creating enough jobs at home.

 

[sauntheninja]

Because our govt. has given up on creating enough jobs at home.

It's probably impossible to create enough jobs. Even in China with their huge industrial base s large number of youth are unemployed and are having the same problems india is facing

 

[crazywithmath]

why are we insisting on sending more of our people there, given situation in west and propaganda against Indians, shouldn't we be staying away from it.

Social media propaganda does not really matter in real life so putting that aside, there is an even more fundamental argument against including 'muh people to people mobility' in the FTA negotiations, exporting bodybags should NOT be the business of any govt of the land.

I believe It’s abundantly clear that the British side is the one dragging its feet in these FTA negotiations. Largely due to their domestic political mess.

Not true. It is the other way around. Go through the articles I posted in my previous post.

The push for more visas in the FTA, serves as valuable bargaining leverage. Beyond our pharmaceutical and diamond exports, we lack industries that can consistently outcompete local players abroad.

Again, not true. Our electronics and engineering exports are on steroids, literally. Heck, we are even moving away from our traditional dependence on petro product exports.

Why do you have such low opinion of our domestic industry when our non petroleum exports are witnessing near double digit growth?

Meanwhile, the EU and New Zealand often uses their stronger position to threaten our domestic food security by demanding the removal of all tariffs on agriculture and dairy. These visas give us leverage to push back against those demands.

1. They do not 'threaten' anybody; they are not even in a position to do anything like that. They come to the WTO, do some rr in front of our babus, the babus laugh in their faces (because the WTO appellate body has been dysfunctional for years now) and that is about it.

2. 'Visas' are a privilege, not a leverage.

Not to mention, our IT coolies are one of the biggest sources of remittances

We are not a remittance dependent economy, it does not matter at all. Again, why do you have such a low opinion of the Indian economy?

and a practical way to offset unemployment in the country, so I don’t see this as a bad strategy to lean on. To deny them the opportunity to exploit our weaknesses.

This might be a viable strategy for the likes of kanglus and pakroaches but not for us. Only inefficient loser economies engage in 'remittance kanging' by shipping bodybags.

The UK in particular is desperate for a market for their automobile sector, so these IT visas serves a good enough way to tackle their demands, while keeping our local players protected.

The UK barely has an automobile sector right now. If tariffs are eliminated their market will be ours to take, not the other way around. Do not confuse them for Germany/France.

While I agree that MMS and Maino were utterly incompetent, I think you’re underestimating the impact of non-trade barriers that fueled those trade deficits. ASEAN, in particular, exploited weak rules of origin to dump Chinese goods into our market. If we aren’t careful, the Brits and Europeans could pull a similar stunt under the guise of environmental sustainability (carbon tariffs) and compliance costs take us for another ride.

ASEAN dumped cheap goods because it was inevitable. You sign FTAs with richer nations, not with your competitors.

 

[GaudaNaresh]

why are we insisting on sending more of our people there, given situation in west and propaganda against Indians, shouldn't we be staying away from it.

because India does not have capacity to absorb its STEM graduates in industry and it wont for another 2 decades even if it goes through china-like growth.
For comparison, India makes about 800,000 engineers every year. China makes about 900,000, USA makes about 250,000.
Same over-production of doctors also exist, where India literally produces 5x the number of doctors every year as total number of spots that exist in govt hospitals across the entire nation.

So what is India supposed to do with these graduates ? Give them 2 dollars an hour uber-driver jobs ? You cant blame Modi or Maun Mohan Singh or Indira or Nehru on this - how the hell is a country with 4T economy and where 50% of its workforce still works agri sector, with its entire mfg + service sector being like 5% of the planet, supposed to absorb the number of engineers produced and absorbed by 5x bigger economy and industrial sector ???

The only way for India to deal with overcapacity, IS via the NRI/PIO route and get these people overseas employment, so they can send $$ home to parents instead of being disgruntled uber driver in India.

As a bonus, this also lets us soft-colonize the western world at the perfectly right time in history- where their own demographics are collapsing.

 

[Azaad]

'How do you sell to dinosaurs?': Mohandas Pai questions Piyush Goyal's 'ice cream' jibe at Indian startups

From lack of capital to regulatory hurdles, Pai said the real problem isn’t ambition, but the system meant to support it.

www.businesstoday.in

Battle is joined by the other side. May the most RPM motor mouth win.

Alhamdulillah!

 

[Migflug]

WorldOne Energies Commissions 1.2 GW Module Manufacturing Facility - Mercom India

Solar module manufacturer WorldOne Energies has commissioned a 1.2 GW solar module manufacturing facility in Nagpur, Maharashtra. The facility will produce N-type tunnel oxide passivated contact...

www.mercomindia.com

 

[Azaad]

Those are the kind of fancy buzzwords they throw in whenever they are in the process of drafting a new deal. Even the Paris agreement had some similar jargons thrown in here and there.

These " fancy buzzwords " have the ability to be converted into NTBs. Isn't that why our negotiations with the EU stuck? I wouldn't be as sanguine as you're on the benignity of these "fancy buzzwords. " We're dealing with an ethnicity notorious for double dealing. They aren't known as perfidious albions by their neighbors for nothing.

 

[eastern_bhartiya]

because India does not have capacity to absorb its STEM graduates in industry and it wont for another 2 decades even if it goes through china-like growth.
For comparison, India makes about 800,000 engineers every year. China makes about 900,000, USA makes about 250,000.
Same over-production of doctors also exist, where India literally produces 5x the number of doctors every year as total number of spots that exist in govt hospitals across the entire nation.

So what is India supposed to do with these graduates ? Give them 2 dollars an hour uber-driver jobs ? You cant blame Modi or Maun Mohan Singh or Indira or Nehru on this - how the hell is a country with 4T economy and where 50% of its workforce still works agri sector, with its entire mfg + service sector being like 5% of the planet, supposed to absorb the number of engineers produced and absorbed by 5x bigger economy and industrial sector ???

The only way for India to deal with overcapacity, IS via the NRI/PIO route and get these people overseas employment, so they can send $$ home to parents instead of being disgruntled uber driver in India.

As a bonus, this also lets us soft-colonize the western world at the perfectly right time in history- where their own demographics are collapsing.

I am concerned about if Indians become visible there, racism against will increase, but your point is also true. What is the overall best solution then ? they can work there but never get to vote ? its gonna become another canada situation with CCP funded bots going on overdrive to post propoganda video and posts all over SM.

People need to be moved away STEM and more into other fields anyways like mechanical ( yes, i know mech in STEM, but in Indian context STEM is basically IT + med) .

 

[crazywithmath]

These " fancy buzzwords " have the ability to be converted into NTBs. Isn't that why our negotiations with the EU stuck? I wouldn't be as sanguine as you're on the benignity of these "fancy buzzwords. " We're dealing with an ethnicity notorious for double dealing. They aren't known as perfidious albions by their neighbors for nothing.

I am not sure what made you arrive at this conclusion but the FTA with EU is tricky because,

1. Germany/France have strong automobile sector,

2. EU as a whole massively subsidizes agriculture and would like to dump some of the surplus on us,

3. They would likely demand some concessions from us on the agriculture front which, again, is politically challenging.

Beyond this, they barely have an industry (again, barring some truly high end products like aircrafts etc that we would anyway import) - no amount of NTB trickery would work. The TEPA we signed with EFTA last year contains similar 'buzzwords' (ie, 'muh mutual understanding of rule of law' etc) and even an entire section dedicated to intellectual property rights (extremely sensitive given how big a role our generic drug manufacturers play in pharma exports and pretty interesting given our previous tussle with European drug makers), btw. The incumbent did not seem to have a problem back then...

 

[GaudaNaresh]

I am concerned about if Indians become visible there, racism against will increase, but your point is also true. What is the overall best solution then ? they can work there but never get to vote ? its gonna become another canada situation with CCP funded bots going on overdrive to post propoganda video and posts all over SM.

People need to be moved away STEM and more into other fields anyways like mechanical ( yes, i know mech in STEM, but in Indian context STEM is basically IT + med) .

Work there but never vote applies only to middle east. Western world, you always have some pathway to become citizen if you legally immigrate. Sure, can take 20 year in UK, 8 in USA and 2-3 in Canada but system is same, process varies.

What we need to do, is learn from the chinese. They swallowed the whole 'yellow fever, slant eye for white guy' crap 20 years ago quietly, they just went about getting into media, govt and then clamping down HARD on such activities, same as with Muslims. Only diff is, Chinese is not retarded like cousin-marrying muslims, so Chinese dont flex in public like moron muslims do.

The Chinese and the jews have understood one thing about the whiteman that we have not : whiteman is greedy first, racist second. If u offer whiteman 1 million bucks to sell his mom to blackman, he will in 2 seconds flat. So as long as you are HIGHLY successful compared to whiteman, like Chinaman or jooman and Indiaman are, the upper class whites will protect u against the wignats themselves.

India's biggest problem in industrialisation, is not lack of engineers of STEM people. Its lack of trades.
People forget, you dont just need mechanical engineer or electrical engineer to make cars, you ALSO need electricians, mechanics and plumbers to make your damn facility in record time and tip top.

Problem in India is, no one wants to be trades-people. HAL for eg, has shortage of actual electricians. Not engineers. Indian mentality is 'if u r super duper smart, go become engineer/doctor and if u r not that smart, pick commerce and if u r totally stupid, go be liberandu andolanjeevi. NO ONE wants to be electrician or plumber, which is the blue collar sector of STEM.


PS: I am not concerned about rise of racism against Indians in the west. it means we are doing it right. West is focussed racist against minorities that only do better than whiteman. Eg: jooz, chinese and now, us.
And to be honest, we are colonizing them at record pace. if i were them, i would be pissed too. we are basically their Rohingyas, but smarter, harder working and more educated.

 

[Azaad]

I am not sure what made you arrive at this conclusion but the FTA with EU is tricky because,

1. Germany/France have strong automobile sector,

And how strong is the French automotive sector in India? Ze Germans of course are into the high end market.

2. EU as a whole massively subsidizes agriculture and would like to dump some of the surplus on us,

3. They would likely demand some concessions from us on the agriculture front which, again, is politically challenging.

That's one of the sticking points.

Beyond this, they barely have an industry (again, barring some truly high end products like aircrafts etc that we would anyway import) - no amount of NTB trickery would work.

So what in your opinion is holding up the FTA with the EU apart from the points you've listed?

The TEPA we signed with EFTA last year contains similar 'buzzwords' (ie, 'muh mutual understanding of rule of law' etc) and even an entire section dedicated to intellectual property rights (extremely sensitive given how big a role our generic drug manufacturers play in pharma exports and pretty interesting given our previous tussle with European drug makers), btw. The incumbent did not seem to have a problem back then...

The EFTA consists of Liechtenstein, Iceland, Norway & Switzerland of which the latter two are the real heavy weights & drivers of the Union. Where's the comparison to the EU? Here too we've had a run in with Switzerland on the MFN. Wonder how does that impact the TEPA?

 

[eastern_bhartiya]

Work there but never vote applies only to middle east. Western world, you always have some pathway to become citizen if you legally immigrate. Sure, can take 20 year in UK, 8 in USA and 2-3 in Canada but system is same, process varies.

What we need to do, is learn from the chinese. They swallowed the whole 'yellow fever, slant eye for white guy' crap 20 years ago quietly, they just went about getting into media, govt and then clamping down HARD on such activities, same as with Muslims. Only diff is, Chinese is not retarded like cousin-marrying muslims, so Chinese dont flex in public like moron muslims do.

The Chinese and the jews have understood one thing about the whiteman that we have not : whiteman is greedy first, racist second. If u offer whiteman 1 million bucks to sell his mom to blackman, he will in 2 seconds flat. So as long as you are HIGHLY successful compared to whiteman, like Chinaman or jooman and Indiaman are, the upper class whites will protect u against the wignats themselves.

India's biggest problem in industrialisation, is not lack of engineers of STEM people. Its lack of trades.
People forget, you dont just need mechanical engineer or electrical engineer to make cars, you ALSO need electricians, mechanics and plumbers to make your damn facility in record time and tip top.

Problem in India is, no one wants to be trades-people. HAL for eg, has shortage of actual electricians. Not engineers. Indian mentality is 'if u r super duper smart, go become engineer/doctor and if u r not that smart, pick commerce and if u r totally stupid, go be liberandu andolanjeevi. NO ONE wants to be electrician or plumber, which is the blue collar sector of STEM.


PS: I am not concerned about rise of racism against Indians in the west. it means we are doing it right. West is focussed racist against minorities that only do better than whiteman. Eg: jooz, chinese and now, us.
And to be honest, we are colonizing them at record pace. if i were them, i would be pissed too. we are basically their Rohingyas, but smarter, harder working and more educated.

I starting to ger your point, canada messed up by importing all rural punjabis, who would be seen negatively even in urban punjab, as long as the people we're sending are decent , its good IG. the hate campaign against started mostly from disgruntled canadians. another thing is chinese are quite, they move steadily and make their moves, Indians like to make noise.

 

[GaudaNaresh]

I starting to ger your point, canada messed up by importing all rural punjabis, who would be seen negatively even in urban punjab, as long as the people we're sending are decent , its good IG. the hate campaign against started mostly from disgruntled canadians. another thing is chinese are quite, they move steadily and make their moves, Indians like to make noise.

Canada didnt mess up per se by importing rural punjabis, Canada got SCAMMED by khalistanis to import rural punjabis because Canadians are just as ignorant and stupid as americans are at world affairs but too nice and polite, so they dont carry the reputation.
Canada for eg, still allows 'political refugees' from India, South korea, etc. just like as from China or Iran - as if Indians or SoKoreans are getting assassinated or jailed for their political beliefs.

besides, as you said, Indians are louder than the Chinese as fundamental nature and ALSO we dont have language handicap as they do - the average highschool pass Indian understands english, the average highschool pass chinese does not. So a lot of the racist memes/racism online against chinese 20 years ago mostly flew under the radar TO the chinese and were mostly picked up by the American-Chinese/Canadian-Chinese or the ones getting educated HERE.

So racism against Indians will be stronger than against the Chinese for two factors:
1. This isnt 2005 but 2025 and internet is FAR more developed in social media propagation
2. Indians are giving it back 200 times more frequently than the Chinese did, due to said language advantage. We are having full scale dehati desi vs dehati pignat flamewars on the internet, where Noida-man is flaming away Ozark-man from half a planet away.
This factor is absent in east asian racism, coz the average dude in China does not get to even UNDERSTAND the average yankee cope tropes, let alone access forums to argue with them.

 

[Ajayant Tripathi]

shouldn't we be wishing for other way around, currency to get stronger backed by export growth?

I was busy so please pardon me.
But here is the equation i use:
C = F0 − I −(V/E)
where:

• C : Competitive edge in USD (positive if India’s price is below the standard, negative if above).
• F0 : Standard final price in USD (e.g., 125 USD, a market or competitor benchmark).
• I : Import cost in USD (e.g., 100 USD, fixed cost of raw materials).
• V : Value addition in INR (e.g., 2,125 INR, fixed domestic processing cost).
• E : Exchange rate in INR/USD (e.g., 85, 90, variable).

You can clearly see our competitive edge increases as INR devalues in relation to USD. If we keep all other variables constant. It even factors in input/imported raw material cost.

Companies can even book double the profit if they even increase value addition in India.

So, a steadly devaluing rupee infact increases competitive edge of a product produced in india and also incentivises the company to increase value addition in India.

 

[GaudaNaresh]

I was busy so please pardon me.
But here is the equation i use:
C = F0 − I −(V/E)
where:

• C : Competitive edge in USD (positive if India’s price is below the standard, negative if above).
• F0 : Standard final price in USD (e.g., 125 USD, a market or competitor benchmark).
• I : Import cost in USD (e.g., 100 USD, fixed cost of raw materials).
• V : Value addition in INR (e.g., 2,125 INR, fixed domestic processing cost).
• E : Exchange rate in INR/USD (e.g., 85, 90, variable).

You can clearly see our competitive edge increases as INR devalues in relation to USD. If we keep all other variables constant. It even factors in input/imported raw material cost.

Companies can even book double the profit if they even increase value addition in India.

So, a steadly devaluing rupee infact increases competitive edge of a product produced in india and also incentivises the company to increase value addition in India.

Can you explain to me, why did China, at same or worse economic benchmark as India in 1950, throughout its 'completely poor starving africa' stage to ' middle income success story' has never let the Yuan devalue as much as the Rupee ?
IIRC exhange rate for Yuan never dropped below 10, ie, 1USD = 10 Yuan is the alltime low since Chinese independence.
Whereas we have gone from 1USD = 40INR from 1995 to double that in 2025.

I understand your equation perfectly, but why is this equation requiring us to have 1USD = 80INR to retain competitive advantage, when China retains the same with a currency that is literally 16 times more valuable than ours ??

 

[sameer]

why are we insisting on sending more of our people there, given situation in west and propaganda against Indians, shouldn't we be staying away from it.

Mobility is usually a part of many FTA's. As an example, UK- Australia FTA allows UK citizens to work in Australia for 3 years.(See below). UK actually negotiated hard for this.

https://assets.publishing.service.gov.uk/media/61b9b783e90e0704439f4400/uk-australia-free-trade-agreement-fta-mobility-explainer.pdf

Both Chile and Singapore in their FTA's have a exclusive kind of visa called H1B1(different from the popular H1b) which allows them to work in the US indefinitely

Australia has a similar deal with the US.

Honestly, I don't see much wrong with this. We run huge trade deficits and remittances help stabilize the currency to some extent. Offloading a few thousands abroad doesn't matter that much in the long run given that we are unable to generate enuf jobs anyway.

 

[jaijaganath]

View: https://x.com/saikirankannan/status/1907993839811658119

 

[crazywithmath]

And how strong is the French automotive sector in India? Ze Germans of course are into the high end market.

If we give them duty free access, I presume the French will do well here. They won't be able to flood the market (our domestic industry is competitive and mature enough) tho.

That's one of the sticking points.



So what in your opinion is holding up the FTA with the EU apart from the points you've listed?

The three pain points I listed are enough to stall the discussions. I am not sure how the gormint can navigate this, no govt of the land can guarantee concessions on the agri front.

I was mocking Goyal and co because there are virtually no such roadblocks in case of the UK FTA and yet, they cannot get it done just cuz the UK will not accept more IT coolies. Goyal is the commerce Minister of a fast growing US$ 4 trillion economy, he should act like one.

The EFTA consists of Liechtenstein, Iceland, Norway & Switzerland of which the latter two are the real heavy weights & drivers of the Union. Where's the comparison to the EU?

IPR is NTB, no? Switzerland hosts a number of drugmakers and medical equipment manufacturers and the TEPA did contain a section on IPR - the incumbent did not seem to mind at all.

Tbh, NTBs are mostly used as quality control tools till this date - they flush some cheap low quality stuff out and ensure IPR and/or regulatory compliance. It is the chings who perfected the art of employing NTBs as a weapon to flush out competition from abroad (some nations are fighting back in a similar fashion). The rest? Not so much.

There is still very little evidence of trading partners taking all these buzzwords ('muh rule of law', 'muh climate justice' etc) literally and turning them into NTBs. The EU CBAM is a notable exception and even that is primarily aimed against chinese overproduction.

Here too we've had a run in with Switzerland on the MFN. Wonder how does that impact the TEPA?

Because the SC milarrds are idiots. They should not have involved themselves in a matter they understood nothing about and could have left it to the gormint instead.