Opportunities for India due to USA-China trade war

Abstract

The US-China trade relations represent a complex economic relationship between the two countries evolving from tense standoffs to a complex mix of intensifying dipl@macy, growing intemational rivalry, and increasingly intertwined economies. Over the years, rapid growth in trade between the two nations is witnessed - from $4 billion of imports/exports in 1979 to more than $600 billion in 2017. Over the decades, China's exports to the United States have shifted from labor-intensive, low-value items to more capital-intensive goods. It is presently one of the largest suppliers of sophisticated technology items in the United States. China is also the largest holder of US Treasury bonds. The bilateral trade between the United States and China has various outstanding difficulties. The trade deficit between China and the US has exploded as many Chinese imports have overtook US exports to China. Economists and policymakers alike have been concerned about the large trade deficit. Some argue that the disparity results from China's unfair trade practices, while others attribute it to its strength and strongly impacted industrial processes. The Trump administration has implemented several tariff measures to lower the trade imbalance. China's currency policy has also been a contentious topic as the country has maintained its currency undervalued for many years. On the other hand, China has shifted to a more marketbased currency rate, although its currency policy is still being closely scrutinized. Other concerns affecting bilateral trade include conflicts over China's WTO responsibilities, country’s pro-state-owned-enterprise industrial policies, and the failure to respect US IPRs.