Australia
(Source : Consulate General of India, Sydney)
During Jan-July 2020 the bilateral trade figures between the two countries was US$ 5.7 billion approx. as compared to US$ 7.9 billion approx. during the same period of last year. This is a decrease of approx. 27 percent.
India’s merchandise goods export to Australia (Australian imports from India) was US$ 2.0 billion approx. which is an increase of 12 percent as compared to the same period during 2019.
India’s merchandise goods import from Australia during Jan-July 2020 stood at approximately US$ 3.7 billion with a decrease of approx. 39.6 percent as compared to the same period of previous year.
Indian merchandise Exports to Australia was led by ‘Refined Petroleum, followed by the usual items – Medicaments, Pearls and Precious Stones, Made-up textile articles and Rice comprising the top 5.
The total bilateral trade has decreased by approximately US$ 2.2 billion during Jan-July 2020.
The other highlights of bilateral merchandise goods trade have been the significant increase in export of ‘Refined Petroleum’ (887%) to Australia and was the largest Indian exports to Australia, followed by significant increase in export of Telecommunication Equipment (557% approx.) from India to Australia.
Major increase in India’s import from Australia consisted of Silver, platinum, & other metals (628%) and Fresh & Frozen vegetables (383%), during Jan-Jul 2020 from Australia.
In FY 2018-19, the total bilateral trade in services between India and Australia was US$ 6.4 billion approx. (A$ 9.2 billion). During FY 2018-19 the total services export from India to Australia was around US$ 1.8 bn. The top three services export from India are 1. Personal travel (excl education-related) 2. Other Business Services 3. Telecom. computer & information services. During FY 2018-19 the total services import from Australia to India was around US$ 4.6 bn. Australia’s top three services export to India were 1) Education related travel 2) Personal travel (excl. education) and 3) business related travel.
During the reporting period, the top 10 commodities of export from India to Australia included Refined Petroleum Oils, Medicaments, Pearls & Precious Stones, Made up Articles of textile materials, Rice, Jewellery, Manufactures of base metals, Articles of Apparel of Textile fabrics, Floor Coverings, and Organo-inorganic compounds.
Export of ‘Coal’ from Australia to India was the main contributor for the volume of bilateral trade between the countries during the reporting period, with a value of USD 2.7 billion, amounting to 73% of Australia’s total exports to India and 48% of total bilateral merchandise trade.
Confidential Items (SITC: 988) was the 2nd largest Australian export to India with a value of USD 338 million which is understood to include ‘Natural Gas’ as the major contributor with defence items and strategic minerals as other items of the item group.
Brazil
(Source : Consulate General of in India, Sao Paulo)
Significant trends in trade and investment (Sources: MDIC, Valor Economico)
Trade in Goods - Brazil’s trade surplus widened to a record USD 8.06 billion in July of 2020 from USD 2.4 billion in the same month last year and in line in market expectations. When adjusted for the working day average, exports declined 2.9 percent from a year earlier to USD 19.56 billion, while imports fell 35.2 percent to USD 11.50 billion. Among major trading partners, exports dropped to the EU (-9.8 percent) and the US (-37.4 percent) while shipments to Asia jumped 15.4 percent. Imports plunged to Asia (-16.8 percent), the EU (-33.6 percent) and the US (-46.5 percent) respectively.
Analysis - For the second consecutive month, Brazil’s balance of trade hit a new record. In July, the country exported USD 8.06 billion more than it imported, as per data released by the Economy Ministry.
This is the largest surplus for the month since the beginning of this time series, in 1989. Altogether, exports added up to USD 19.56 billion in July, whereas the total of products and services imported stood at USD 11.50 billion.
The main drivers behind the result were the performance of agricultural goods—boosted by a higher demand from Asian countries and a depreciated real—and the generalized decline in imports as a result of the economic crisis brought about by the COVID-19 pandemic.
Year-to-date (January through July), Brazilian exports were 6.4 percent lower than the same period in 2019. As for imports, the plunge in the first seven months was even sharper—10.5 percent. The government estimates that Brazilian exports fall more than ten percent in 2020 and imports are slashed by 17 percent.
Investment - FDI
The net amount of direct investment coming into the country added up to USD2.685 billion, against the USD5.328 billion in July 2019.
From January to July, direct investment entering the country amounted to USD25.527 billion, against USD36.475 billion in the same period of the previous year.
Petrobras should sign sale of refinery
Petrobras President Roberto Castello Branco said this month that he hopes to sign the sale contract for the Landulpho Alves (RLAM) refinery in Bahia. In the natural gas sector, Petrobras expects to complete all divestments in progress by mid-2021.
Google to invest USD10 billion in India`s digital
Alphabet, owner of Google, announced plans to invest about $ 10 billion in India`s digital economy over a five to seven year period, in an effort that could yield the company a slice of a market in which Facebook and others giants also seek. Alphabet executive Sundar Pichai said that Google has set up a fund to develop India`s digitization, and that it will make investments in operations and infrastructure. Pichai said the investment will focus on efforts such as leveraging artificial intelligence in areas such as health, education and agriculture, as well as helping companies go through digital transformations.
Valor Economico Newspaper 13/7/2020
Netflix and Amazon in dispute for Bollywood film industry
“Gulabo Sitabo,” a Bollywood film starring Indian legend Amitabh Bachchan, was expected to attract millions to movie theaters in the spring of the northern hemisphere. However, the Hindi satire debuted on Amazon.com`s Prime service amid quarantine to stem the spread of the coronavirus pandemic in India. Other Indian blockbusters followed suit, flooding online platforms like Walt Disney`s Netflix and Disney + Hotstar. With that, the streaming services got the first rights to show films generally seen in cinemas in the country of 1.3 billion people. Netflix says it has included six new Indian films that would be shown in theaters, while Disney has at least seven of those films available. The India produces more films and sells more movie tickets than any other country, making it one of the biggest prizes for streaming platforms from Netflix, Amazon and Disney. Bollywood - as the film industry in India is called - has resisted the online transition, and the changes of the coronavirus era offer digital operators an unprecedented chance to attract new subscribers.
Information dissemination
Meeting with officials of the International Affairs Special Secretariat for the Investments Partnerships Program (PPI) (under Ministry of Economy of Brazil), 14 July 2020.
During the meeting, Cd’A a.i. Shri. S. Koventhan briefed the Brazilian side on the recent influx of tech investment in India and various efforts taken by the Government of India under the leadership of Prime Minister Shri. Narendra Modi to facilitate the investment and promote India as the Global Manufacturing Base and essential part of Global supply chain. He also suggested to the Brazilian side to explore investment opportunities in Indian IT sector, Food Processing sector and to expand Brazil`s existing partnership with India in Pharmaceutical sector.
Colombia
(Source : Embassy of India, Bogota)
Potential products of Colombian imports from India
HS Code : 870322 - Vehicles; with only spark-ignition internal combustion reciprocating piston engine, cylinder capacity over 1000 but not over 1500cc. As mentioned about, automotive industry in India has become an important supplier, the quality and potential allow that countries such as Colombia prefers the purchase of these products from India.
HS Code : 760120 - India is one of the top exporters of Aluminium; unwrought, alloys. The product is on demand in Colombia as it is used to produce semi-finished and finished industrial goods, especially for home and industrial use.
Significant trends in trade and investment
Trade in Goods - According to the DANE Monthly Trade Survey (EMC, Spanish acronym), in May 2020 the retail trade sales decreased 26.8% compared to 2019. The main goods with a negative contribution were fuels for motor vehicles with a variation of -37.7%; vehicles and motorcycles had a variation of -57.1%. Between January and May 2020, the retail trade sales decreased 11.2%, goods with negative contributions were fuels with -4.2% and vehicles and motorcycles with -3.0%. On the other hand, the goods which had a positive contribution to national
commerce were food products with 3.1%. Also, some activities that recorded positive outcomes were coffee production with the best performance in May 2020 with an increase of 10.2%; production of vegetable oils with 6.2%; dairy products with 1.8%, and pharmaceutical products with 1.1%.
Analysis - According to the figures reported by DANE, May was another month with negative outcomes for Colombia`s economy because the retail trade sales and manufacture industry recorded significant drops. Since Colombia started its
sanitary emergency the figures have been registering negative results. According to Jackeline Pirajan from Scotiabank Colpatria, beverages, non-metallic minerals production, and garments are the most disadvantaged sectors. However, the garment industry has been effectively handling the biosecurity measures and it will be beneficial for its recovery. Due to the mandatory lockdown and mobility restrictions the vehicle purchases are the most affected. But there is a significant trend that shows that Colombian consumers prefer to acquire basic goods rather than other products.
Trade in Services - Regarding the services sector, according to the DANE Quarterly Report of Trade in Services (MTCES, Spanish acronym) between January and March 2020, the main exports were in travel services, other business services, and transport services. Between January and March 2020 exports of travel services decreased by 10.4% and exports of transport services decreased by 5.7% due to a
declining trend on the air transport of passengers that had a negative contribution of 3.8%. Other business services increased by 19.1%. In May 2020, the incomes of the hotel industry decreased by 93.5% in contrast to May 2019. During this year until May 2020, the total incomes were about 42.7%. Additionally, in May 2020 the hotel occupancy rate was 7.9% and from January until May 2020 it was about 44.3% in contrast to the same period in 2019.
Analysis - The projections are alarming for the world’s recovery from this pandemic, because it is unclear when the whole world could access a vaccine. This situation affects the tourism sector because consumers are not considering traveling is a good idea, but there is a small proportion of the population who want to travel. According to experts, they believe that most of the air travels will be at the national level and international flights will take more time to start. It is important to know that due to the negative outcomes from the national economy, the tourism sector has been the most affected by this pandemic, having taken into account that a lot of Colombian people have lost their employment or they have accepted wage reductions, which makes it impossible to think that some people can travel during this crisis.
Investment - Foreign investment in oil, hydrocarbons and mining decreased 36.7%. The decrease in oil investment was due to low fuel prices caused by the low demand for crude oil generated by the coronavirus. On the other hand, foreign investment in non-oil, mining or hydrocarbon sectors reached US$1,771.9 million in June, which represented an increase of 65.6% compared to the first half of 2019 when it was US$1,069.5 million. During the first six months of the year, there were US$1,539.2 million in portfolio investments in Colombia. According to Invest in Bogotá figures, new and expanding Foreign Direct Investment generated more than 93,000 jobs in 2019 with an average of 566 jobs for each investment. The sectors that generated the most direct and indirect jobs in the city last year associated with FDI were software and IT services, business services, electrical appliances, and components. Despite these figures, ProColombia stated that in the first semester of this year there were 102 foreign investment projects that arrived in the country and represented US$5,648 million. This represents an increase of 18% compared to the amount for the same period of 2019.
Analysis - "Foreign investment has proven to be a vehicle for growth and development that generates dynamics for the economic reactivation and competitiveness of the country. At a time when investors are looking for safe and profitable shelters, Colombia stands out as a great alternative in Latin America, the figures show it and the interest of the businessmen confirms it", said Flavia Santoro, president of ProColombia. Due to COVID-19, foreign investment has been recording disappointing results compared with the last year’s outcomes. The main factor that is affecting FDI is the decrease in oil investment due to the low demand for crude oil. However, ProColombia has shown that foreign investment projects have reached positive outcomes in Colombia and it is generating new jobs which will contribute to the national economy`s recovery.
The Ministry of Commerce, Industry, and Tourism reported that Colombian exports decreased by 40.3% in May 2020. This was due to the drops in some economic sectors, such as in fuels and extractive industry sales with -33.8%; manufacture sales decreased 38.4%; agricultural, food and beverages sector fell 11.7%; miningenergy exports recorded US$1,213 million with a reduction of 48.2%, and non-mining-energy exports recorded US$1,024 million with a reduction of 27.1%. There was an increase in exports to India (73.1%), Puerto Rico (3.3%), the United Arab Emirates (193.4%), and Singapore (924.3%). On the other hand, the total exports between January to May were about US$12.891% million with a reduction of 25.1%.
Conforming to the Port Traffic Statistical Bulletin from the Superintendency of Transport, in 2019 the port zone in Cartagena had the largest volume of shipment with a total amount of 21.46%. Also, in the last three years Cartagena has been the most important port zone in Colombia because it recorded 18.6% in 2017, 19.8% in 2018, and 21.4% in 2019. The executive president of the National Association of Foreign Trade (Analdex, Spanish acronym), said that Cartagena has been playing an important role in the redistribution of goods and it is important to note that Colombia has a strategic geographical location and it will allow increasing its competitiveness in the region. In addition, the two terminals of Port Cartagena Group called “Conectar” and “SPRC” recorded 21.9% of the shipment mobilized in Colombia. Regarding exports, the main products exported in Colombian ports were coal, oil, coal coke and briquettes, household items, bananas, vegetable oils, sugar, clinker and coffee. In the first quarter of 2020, 44.8 million tons were mobilized, and it represented a fall of 3.8% due to the COVID-19 emergency. Despite the decrease, the Caribbean port mobilized 89.6% of shipment and it was equivalent to 40.1 million tons.
According to ProColombia, there are opportunities for Colombia’s international trade after COVID-19 in regional trade and business with multinational companies. Because of the sanitary emergency, there were difficulties with the supplies from Asia, for this reason, one of the opportunities will be to strengthen regional trade between Latin American countries where Colombia will be a good supplier for the region with tariff benefits thanks to the Trade Agreements. According to ProColombia president, Flavia Santoro, they are looking for Colombian companies that have production capacity and competitiveness to compete with Asian suppliers and it is important to know that E-Commerce will be a key tool.
Ecuador
(Source : Embassy of India, Bogota)
Potential products of Ecuadorian imports from India
HS Code : 870323 - Vehicles; with only spark-ignition internal combustion reciprocating piston engine, cylinder capacity over 1500 but not over 3000cc. India has one of the most important automotive sectors across the world, and this sector contributes to industrial development. In Ecuador there is a high demand for vehicles coming from India.
HS Code : 721061 - Iron or non-alloy steel; flat-rolled, width 600mm or more, plated or coated with aluminum zinc-alloys. Iron and steel industry in India have an important role inside the Indian trade, as this country is the world’s second largest producer. These products are part of many manufactures for daily use, such as automotive industry and different articles with increasing demand in Ecuador.
HS Code : 854370 - Electrical machines and apparatus; having individual functions, not specified or included elsewhere in this chapter, n.e.c. in heading no. 8543, such as electric motors are found in applications as diverse as industrial fans, blowers and pumps, machine tools, household appliances, power tools, and disk drives. With the COVID- 19 outbreak and the need for medical equipment, like mechanical ventilators, these machines are in demand all over the world.
HS Code : 721049 - Iron or non-alloy steel; flat-rolled, width 600mm or more, (not
corrugated), plated or coated with zinc (not electrolytically). Iron and steel industry in India have an important role in their trade, as this country is the world’s second largest producer. These products are part of many manufactures for daily use, such as automotive industry and different articles.
Significant trends in trade and investment
Trade in Goods - Home delivery service companies like Glovo, Uber Eats and Kantar expose a change in consumption trend. Glovo registers higher deliveries of snacks, desserts, and other traditional products, such as chicken, hamburgers, pizzas, or Chinese food. “This means that the user prefers to purchase products that improve their mood. There is a tendency to eat something delicious, rather than healthy", says Daniel Arévalo, general manager of Glovo Ecuador. This change in the consumption habit of the delivery service users shows the inclination for the so-called ‘comfort food’. UberEats says that ice creams have also been in greater demand in recent weeks, as well as steaks, fries, pizza, and hamburgers. The Kantar Food Print study, which analyzes consumption in Latin America, shows that in Ecuador the condiments, canned tuna, soft drinks, coffee, and milk prevail. Édgar Salas, director of Innovation of the UEES University, mentions that these choices are linked to cost, as "it is cheaper to buy rice with stew and fried chicken at US$2.15 than a Caesar salad at US$4.50; healthy food is more expensive".
Analysis - There is an increasing consumption trend in basic products, such as carbohydrates and cleaning products due to many factors, like people`s preference and low prices. This shows that the cost plays an important role when consumers decide what kind of product they want to buy at supermarkets. According to figures, the Ecuadorian population prefers cheaper products that they can find more easily than other products, such as healthy food that will be more expensive. On the other hand, there is a trend for acquiring food products through digital purchases and delivery services for convenience, safety, and avoiding congestion.