Foreign Trade.

Foreign Trade.


Recently, China signed a deal with Russia to invest 1.5 billion US $ in construction, timber, agriculture and other industries in Russia. In all, eight projects were signed by China Investment Forum. It envisages Chinese companies investing 1.3 billion US $ into building a housing complex in St. Petersburg. The Russian and the Chinese delegation also laid the corner-stone for the Baltic Pearl Complex which will house 35000 families in the first phase of the project. Russia is a quite rich nation now. For the last few years, prices of crude-oil have sky-rocketed beyond imagination.
With the prices of Crude-oil 52 $ a barrel, Russia has en-cashed on this price-hike. It came out of economic collapse it faced a few years ago. Russia is the second largest crude-oil producer in the world after Saudi Arabia. Now Russia is a spending-master, eager to make projects for the benefit of its people.
Everybody thinks about China, either from a risk perspective, or from an opportunity perspective. Many countries have established a foothold in China, or are in the process of entering the Chinese market. There is considerable risk factor involved. If its economy were to stall its way into hard-landing, the big hit to other countries would come indirectly by a decline in global commodity prices. In fact Chinese merchants risk trade retaliation unless the Yuan currency is un-pegged from the US $. It is a fact that the Yuan is greatly undervalued and it has given the Chinese exporters an unfair advantage in world-trade. There is continuous pressure from the western countries on China to re-value its currency vis-a-vis the US $. China's stock-phrase reply is " We will see."
Western countries believe that emergence of China as a Super-power is a threat to the world-peace.
They also feel that regardless, China will surely soon dominate the world. Its rising military strength is also a problem. It is spelled out at length in the latest issue of Atlantic Magazine.
" When power relationships are correctly calibrated, wars tend to be avoided.
Only a similarly pragmatic approach will help to accept China's re-emergence as a Great
Power. "
China joined WTO in 2001. It had promised to allow member states to restrict imports of Textiles
and wearing dress,etc of Chinese goods if such imports threatened to disrupt their markets. China conveniently disregarded all his commitments and reports indicate that it has dumped
hundredfold shipments of T-shirts, cheap hosiery articles and flax yarn in the western countries.
In the area of Footwear also, China has dumped in a triple-digit leap shipments of footwear
into western countries. Average price for a pair of cheap leather shoes from China is 3 US $. The Europe countries and the USA say that they can not buy even, the raw materials for one pair of shoes at that price. Forced labour has helped China to accelerate its production output in each and every field to an unimaginable extent. USA and the European Union have been negotiating with China to up-value its Yuan currency and stop unfair trade practices otherwise they would be constrained to slap sanctions and/or impose import duty on Chinese goods. Chinese reply is as usual a stock-phrase. "We will see." No action thereafter whatsoever.

In light of what is stated above, it will be in the fitness of things, to be very guarded in dealing with that country especially when we have tripled our trade with that country within the last few years.
Our country is committed to eradicate poverty and gain economic development at a faster speed.
It will be necessary to assess every proposal made by that country very critically with pros and cons in all sides before finalising any deal with that country. A.M.D.G.