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China warns India against playing risky games towing US lines

China warns India against playing risky games towing US lines

BEIJING – India has shown signs of moving toward the position of USPresident Donald Trump by adopting protectionist measures against China,possibly in a bid to please the US ahead of trade talks and to pressureChina into addressing the growing trade imbalance between the two countries.But experts said India is playing a risky game, as getting any benefitsfrom the US in trade is unlikely and there is a danger of underminingefforts to boost trade with China, Global Times, a prestigious Chinesenewspaper reported on Wednesday.

This week, India’s Department of Commerce recommended tariffs as high as 25percent on solar cells and modules imported from China for a two-yearperiod.In a separate move over the weekend, the Indian government reportedlyraised concerns over its trade deficit with China and claimed that Chinahad put in place restrictions on visas for Indian professionals and exportsof Indian IT services, meat, rice and medicines to China.

“It is clear that India is trying to copy Trump’s protectionist actionsagainst China,” Lin Boqiang, director of the China Center for EnergyEconomics Research at Xiamen University said.Lin also said the proposed solar tariffs are not based on anti-dumpinginvestigations, as required by the WTO, but are simply intended to protectIndia’s domestic industry.

A report by the Indian Department of Commerce’s Directorate General ofTrade Remedies said the tariffs could “mitigate” the damage that surgingimports of solar cells and modules had inflicted on Indian producers.The proposal still needs to be approved by the Indian government. But evenif India goes ahead with the tariffs, the impact on Chinese companies willbe “very small,” Lin said, because even though China supplies a largeproportion of India’s solar cells and modules, “the overall volume is verysmall.”

But the move plays into a much bigger strategy, under which India appearsto be trying to side with the US in the hope of being exempted from UStariffs on steel and aluminium. And India also hopes to remedy its massivetrade deficit with China, which rose to $62.9 billion in 2017, according toexperts.

“India has become very sensitive about its trade deficit… so it wants tojoin the US in seeking greater market access from China,” Liu Xiaoxue, anassociate research fellow at the Chinese Academy of Social Sciences’National Institute of International Strategy opined.In voicing its concerns over trade issues with China at the WTO, India hasjoined the US, the EU and others who have accused China of unfair practices.

India has also prepared a white paper aimed at boosting trade relationswith the US and Indian officials are scheduled to hold talks with USofficials in Washington to discuss tariffs on steel and aluminium this week.

“India is making a very risky move here. Its friendly gestures to the USare unlikely to get anything in return from Trump and they could draw irein Beijing and potentially undermine its efforts to expand exports toChina,” Lin said.Liu pointed out that if India wants to reduce its trade deficit with China,it should focus on improving the competitiveness of its domestic industriesrather than imposing tariffs.

“China wants to balance trade with India by expanding imports of Indiangoods, but they don’t make many things that China really needs,” Liu said.- APP