international trade agreement

International Business

Group Member:-Ritwik Sharma(90)

Rajshekhar Ganti(23)Jithish Nambiar(53)

Himanshu Pandey(55)Pratik Patel

Priyanka GhareAmeya Bhogwekar

Abhinav ThakurDeepak Vasu

BRICS Nuclear power FTP Space program Defense Russia china defense barriers

Topic To Be covered

It is the exchange of Capital goods, and services

across International Borders or territories.

Increasing international trade is crucial to the continuance

of globalization.

Without International trade, nations would be limited to the

goods and services produced within their own borders.

What is International trade

Types of International trade

It is conducted within the political and geographical boundaries of a

country.

It can be at local level, regional level or national level.

Trade carried on among traders of Delhi, Mumbai, etc. is called home

trade.

Wholesale Trade : It involves buying in large quantities from

producers or manufacturers and selling in lots to retailers for resale

to consumers. 

Retail Trade : It involves buying in smaller lots from the wholesalers

and selling in very small quantities to the consumers for personal use

Internal/Home/Domestic Trade

It refers to buying and selling between two or more countries

Export Trade : When a trader from home country sells his goods to a

trader located in another country, it is called export trade. For e.g. a

trader from India sells his goods to a trader located in China.

Import Trade : When a trader in home country obtains or purchase

goods from a trader located in another country, it is called import trade.

For e.g. a trader from India purchase goods from a trader located in

China.

Entrepot Trade : When goods are imported from one country and then

re-exported after doing some processing, it is called entrepot trade

External/Foreign/International Trade

Memorandum of Understanding 

Non-Disclosure Agreement

Teaming Agreement 

Material Transfer Agreement

Master Agreement

Subaward

IPA 

Consultant Agreement 

Types of Agreement (

http://osp.gmu.edu/types-of-agreements/)

A trade agreement which is also know as Trade Pact is a wide ranging

tax, tariff, and trade treaty that often includes investment guarantees.

Any contractual arrangement between countries concerning their trade

relations.

Trade agreements may be bilateral or multilateral, that is, between two

countries or more than two.

The most common trade agreement are of the preferential and free

trade type.

They are rules and regulations that govern trade. They are rules and

regulations that every Nation breaks. They are also very controversial.

International Trade Agreement

International Trade Agreement

Preferential Trade Agreement (PTA)

Free Trade Agreement (FTA)

MultilateralBilateral

Types of International Trade Agreement

It is a trading bloc that gives preferential access to certain

product from the participating countries.

This is done by reducing tariffs but not by abolishing them

completely.

A PTA can be established through a trade pact.

 It is the first stage of economic integration.

The line between a PTA and a free trade area (FTA) may be

blurred, as almost any PTA has a main goal of becoming a FTA in

accordance with the General Agreement on Tariffs and Trade

Preferential Trade Agreement

A multilateral trade agreement involves three or

more countries who wish to regulate trade

between the nations without discrimination.

States get involved in multilateral agreements

because the responsibilities and risks are

distributed among the group and thus the

situation is more advantageous for individual

Multilateral Trade

A bilateral agreement is made between two and

only two states. The agreement can be political,

military or economic.

The major reason states might pursue bilateral

agreements is because it is easier to negotiate

with just one country rather than with several.

Bilateral Trade

Multilateral1. Asia-Pacific Trade Agreement

  (1976)

2. Global System of Trade

Preferences among Developing

Countries (GSTP) (1989)

3. Protocol on Trade Negotiations

(1973)

Bilateral1. India-Afghanistan (2003)

2. India Mauritius

3. India-Nepal(2009)

4. India-Chile(2007)

5. India-Mercosur(2009)

List of Preferential Trade Area

 It is a trade bloc whose member countries have signed

a free-trade agreement (FTA), which eliminates tariff,

import quotas, and preferences on most  goods and

services traded between them.

 It can be considered the second stage of economic

integration.

Countries choose this kind of economic integration if their

economic structures are complementary

Free Trade Agreement

Bilateral1. India-Malaysia(separate from

FTA agreement with ASEAN)

2. India-Sri Lanka

3. India-Singapore

4. India-Canada(negotiation

on going)

Multilateral1. ASEAN Free Trade Area

2. South Asian Free Trade Area

List of Free Trade Area

The World Trade Organization (WTO) is an

organization that intends to supervise

and liberalized international trade

The WTO oversees about 60 different agreements

which have the status of international legal texts

 Member countries must sign and ratify all WTO

agreements on accession

World Trade Organization Agreement

Agreement on Agriculture.

Agreement on technical barriers to trade.

Agreement on Anti-Dumping.

Agreement on Custom Valuation.

Agreement on Rules of Origin.

World Trade Organization Agreement

India

President- Mr Pranab Mukherjee.

Minister of commerce – Mr Anand Sharma.

The GDP for the entire FY13 grew at 5%.

The economy of India is the 9th largest in the world by nominal

GDP and the 3rd largest by Purchasing Power Parity (PPP).

Reserves of foreign exchange and gold- $287.2 billion (31

December 2012 est.) 

Stock of direct foreign investment- $256.6 billion (31 December

2012 est.)

INDIA

Textiles

Chemicals

Food processing

Steel

Transportation Equipment

Cement, Mining

Petroleum

Machinery

Software

Pharmaceuticals

Main Industries

Exports- $309.1 billion(2012 est.)

Exports Goods- Petroleum products, precious stones, machinery, iron and

steel, chemical ,vehicles, apparels

Exports Partners- UAE 12.7%, US 10.8%, China 6.2%, Singapore 5.3%, Hong

Kong 4.1% (2011)

Imports- $488.6 Billion (est. 2012)

Imports Goods- Crude Oil, Raw precious stones, Machinery, Fertilizers ,Iron

and Steel, Chemicals.

Imports Partners- China 11.9%, UAE 7.7%, Switzerland 6.8%, Saudi Arabia

6.1%, US 4.9%.

Trade deficit - $191.6 billion.

India has trade deficit with 80 countries.

Export and Import

India-World

Russia

President- Mr. Vladimir Putin

Capital- Moscow

Economy of Russia is the 8th largest economy in

the world by nominal value 6th/5th largest by

Purchasing Power Parity(PPP)

The Gross Domestic Product (GDP) in Russia

expanded 1.60 percent in the first quarter of

2013.

RUSSIA

Complete range of mining and extractive.

Industries producing coal, oil, gas, chemicals, and

metals.

All forms of machine building from rolling mills to

high-performance aircraft and space vehicles.

Defense industries including radar, missile

production, and advanced electronic components,

shipbuilding.

Main Industries

Road and rail transportation equipment.

Communications equipment.

Agricultural machinery, tractors, and construction

equipment.

Electric power generating and transmitting

equipment; medical and scientific instruments;

consumer durables, textiles, foodstuffs, handicrafts

Main Industries(cont….)

Exports- $542.5 billion (2012 est.)

Exports Goods- petroleum and petroleum products, natural gas,

metals, wood and wood products, chemicals, and a wide variety of

civilian and military manufactures

Imports-$358.1 billion (2012 est.)

Import goods machinery, vehicles, pharmaceutical products,

plastic, semi-finished metal products, meat, fruits and nuts,

optical and medical instruments, iron, steel

Gross external debt $455.2 billion (2012 est.)

Export and Import

Russia-World

India-Russia Trade Agreement

India, Russia mull free trade agreement.

BHEL looking to build thermal power units in Buryatia.

India’s aid on KNPP’s spent nuclear fuel.

Russia’s IG Seismic wins 3-D seismic contract in Rajasthan.

Russian Railways keen to participate in Indian track

electrification.

India-Russia FGFA PAK T-50 Agreement.

India-Russia bilateral trade crosses US$ 11 billion in 2012.

India-Russia Defence Cooperation.

Agriculture Cooperation Program.

India-Russia Trade Agreement

The total trade between the two countries

currently stands at $8.5 billion.

Indian investments in Russia stand at $5

billion while that of Russia in India stand at

$3.5 billion.

Common target is to achieve $20 billion in

trade by 2015

India, Russia mull free trade agreement

BHEL looking to build thermal power units in Buryatia.

(14.June.2013)

two thermal power plant units 

The first phase of the project involves the construction of two power

units with a capacity of 240 MW each.

India’s aid on KNPP’s spent nuclear fuel

◦ Construction on the plant began on 31 March 2002

◦ The first reactor of the plant attained criticality on 13 July 2013

◦ The plant was commissioned six years after the scheduled date

◦ he original cost of the two units was 13,171 crore

◦  but it was later revised to 17,270 crore

◦ Russia advanced a credit of 6,416 crore to both the units.

◦ Cairn India Ltd has awarded a two-year contract for a 3-

dimensional seismic survey of its prolific Rajasthan oil block to

Russian firm IG Seismic Services for an undisclosed sum.

◦ The works may cover over 1,500 square kilometers 

◦ he start of works is planned for the beginning of October 2013

◦ Cairn, which holds 70 per cent in the Rajasthan block, had

previously announced an investment of $ 2.4 billion in the

block by 2015-16

◦ State-owned Oil and Natural Gas Corp (ONGC) holds the remaining 30 per

cent interest in the block

Russia’s IG Seismic wins 3-D seismic contract in Rajasthan (July 19, 2013)

Cairn India oil block

The Sukhoi/HAL Fifth Generation Fighter

Aircraft (FGFA) is a fifth-generation fighter being

developed by India and Russia

50:50 joint venture total of 500 Aircraft

FGFA) for the Indian Air Force

Russian fifth generation fighter, code-named T-50

Program costed US$ 30 billion

Unit costed US$100 million

India-Russia FGFA PAK T-50 Agreement

FGFA PAK T-50

India-Russia bilateral trade, which stood at US$

7.46 billion in 2009, US$ 8.53 billion in

2010, and US$ 8.87 billion in 2011, has

spurted to US$11.04 billion in 2012,

registering a 24.5% growth in 2012 compared

to 2011.

the target of US$ 20 billion for India-Russia

trade set for 2015

India-Russia bilateral trade crosses US$ 11 billion in 2012

Defense cooperation is an important pillar of the India-Russia

strategic partnership

It is guided by the Program for Military Technical Cooperation signed

between the two countries which is valid, at present till 2020.

Bilateral projects currently underway include indigenous production

of T-90 tanks and Su-30-MKI aircraft, supply of MiG-29-K aircraft and

Kamov-31 and Mi-17 helicopters, upgrade of MiG-29 aircraft repair

and refit of the aircraft carrier INS Vikramaditya and supply of Multi-

Barrel Rocket Launcher Smerch.

Lease of Submarines

India-Russia Defence Cooperation

Integrated Long Term Program (ILTP) of Cooperation in Science & Technology.

1. Advanced Research Centre for Powder Metallurgy and New Materials

(Hyderabad)

2. Polio & other Vaccine Manufacturing (Bulandshahr) Facility

3. Indo-Russian Centre for Advanced Computing Research (Moscow)

4. Indo-Russian Centre for Biotechnology (Allahabad)

5. Indo-Russian Centre for Gas Hydrates Studies (Chennai)

6. Indo-Russian Centre for Earthquake Research (New Delhi):

7. Russian Indian Centre on Ayurvedic Research (Moscow)

8. Indo-Russian Centre for Biomedical Technology (Thiruvananthapuram).

9. Indo-Russian Centre on Non-Ferrous Metallurgy (Jamshedpur)

10. http://www.indianembassy.ru/index.php/en/science-technology/indo-russian

-s-t-cooperation

Indo-Russian S&T Cooperation

China

President- Mr. Xi Jinping

Capital- Beijing

2nd largest economy (nominal) and 2nd

largest in Purchasing Power Parity(PPP).

GDP growth by 7.8%.

FDI stock $116 billion.

CHINA

World leader in gross value of industrial output

Mining and Ore processing

Iron, Steel, Aluminum, and other metals

Coal

Machine building

Textiles and Apparel

Petroleum; Cement; Chemicals; Fertilizers

Consumer products

Transportation Equipment, including Automobiles, Rail cars and Locomotives, Ships,

and Aircraft; Telecommunications Equipment, Commercial Space launch vehicles,

Satellites

Main Industries

Exports-$2.021 trillion (2012 est.)

Export goods-Electrical and other machinery, including data

processing equipment, apparel, textiles, iron and steel,

optical and medical equipment.

Imports-$1.78 trillion (2012 est.)

Import goods-Electrical and other machinery, oil and

mineral fuels, optical and medical equipment, metal ores,

plastics, organic chemicals.

Export and Import

China-World

India-China Trade Agreement

In 2012, bilateral trade was USD 66 billion a decline from USD 74 billion in 2011.

The two countries have set a target of USD 100 billion by 2015 for bilateral trade.

The signing of the MoUs between India and China is a good beginning to address the issues India is raising with China from time to time

India has been finding it difficult to expand its trade with China in the pharmaceutical sector due to the complex registration process and prolonged timelines

The average imports of medicinal and pharmaceutical products from China during the last five years were $4,332.37 million vis-a-vis exports from India of $692.44 million.

India-China Trade Agreement

By end 2011, India's trade deficit was USD 27 billion.

According to Chinese trade figures released in January

2013, the figure expanded to USD 29 billion by 2012.

As per Chinese figures, cumulative Chinese investments

into India till December 2011 stood at USD 575.70 million

while Indian investments into China were USD 441.70

million.

FACT http://economictimes.indiatimes.com/slideshows/nation-world/chinese-premier-li-keqiang-visits-india-to-boost-ties/bilateral-trade-to-get-a-boost/slideshow/20137842.cms

India-China Signed 8 MOU:-

1. The Kailash Mansarovar Yatra to the Tibet Autonomous

Region of China.

2. Work Programs of the Three Working Groups under Joint

Economic Group.

3. MOU on Buffalo Meat, Fishery Products and Agreement on

Feed and Feed Ingredients.

4. MOU on Cooperation in the field of Sewage Treatment.

India-China Trade Agreement

5. MOU in the field of Water Efficient Irrigation.

6. MOU on Cooperation in Mutual Translation and

Publication of Classic and Contemporary Works.     

7. MOU upon Provision of Hydrological Information of

the Yaluzangbu/Brahmaputra River in Flood Season

by China to India.

8. MOU to facilitate cooperation and linkages between

Indian and Chinese cities & states/provinces

India-China Signed 8 MOU(cont)

India's trade deficit with China is $40 billion 24% slump in Indian exports

http://www.thehindu.com/business/Economy/24-slump-in-indian-exports-highlights-china-trade-barriers/article4696235.ece)

India-China Trade Barrier

Russia-China Trade Agreements

Russia and China agree $270bn oil deal.

China-Russia currency agreement further threatens

U.S. dollar.

Russian-Chinese trade to reach 100 billion dollars by

2015.

Russia reopens railway crossing from Maritime

Territory to China

Russia ramps up seafood exports to Asia Pacific(more

than 40 per cent in the first half of 2013.).

Russia-China Trade Agreements

India-Russia-China Trade

Russia-India-China perceives that in today’s world, it is important to discuss the challenges of global security and stability.

The diverse threats and risks cannot be addressed by military power alone but need to be appraised through political, social and economic prisms. 

The population of these three countries together amounts to around 2.4 billion, 40 percent of the world’s total population. They cover a total area of 29.96 million square kilometers which is 22.5 per cent of the total area of the world. Undoubtedly, the three countries have great human resources, huge potential of market and rich endowment of natural resources

India-Russia-China

Russia, India, China have agreed to provide

credit to each other in local currencies. (BRICS

March 29, 2012) 

Establishing effective foreign-policy and economic

cooperation in the trilateral Russia-India-China format

Alliance framework aimed at countering the US

influence.

Need for a Multi-Polar International System

India-Russia-China Trade

International Trade Agreement

North and West Africa

COUNTRIES

Algeria

Egypt

Libya

Morocco

Sudan

Ghana

Nigeria

Western Sahara.

Global Imports

Nuclear reactors, boilers, machinery

Cereals

Iron and steel

Electrical, electronic equipment

Salt, sulphur, earth, stone, plaster, lime and

cement

Cotton

Global Exports

Oil

Natural gas

Phosphates

Cocoa

Chemicals

Chemical fertilizers

West Africa Economic and Monetary Union (UEMOA)-

Benin, Burkina Faso, Cote d'Ivoire, Guinea-Bissau, Mali,

Niger, Senegal & Togo

Economic Community of west Africa States (ECOWAS)-

Benin, Burkina Faso, Cape Verde, Cote d'Ivoire, the

Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Mali,

Mauritania, Niger, Nigeria, Senegal, Sierra Leone & Togo

Trade Blocs

Central Africa Customs and Economic Union (UDEAC)-

Cameroon, the Central Africa Republic, Chad, the Republic

of Congo, Equatorial Guinea & Gabon

Ghana – Netherlands

Ghana-EU

United States-Morocco FTA

Trade Blocs

South Sudan-American Friendship and Trade Association

Sudan Chamber of Commerce, Industry and Agriculture

AEC – African Economic Community

EU-Egypt Association Agreement

Major Trading

European Union

United States

South Africa

Advantages of Trade Blocs

Free trade within the bloc

Economies of scale

Market access and trade creation

Jobs

Protection

Disadvantages of Trade Blocs

Loss of benefits

Distortion of trade

Inefficiencies and trade diversion

Retaliation

Issues in Africa

Intra African Trade – 12% only

Poor Infrastructure

Limited national markets

Poverty

DFTP - Duty Free Tariff Preference

DFTP - Duty Free Tariff Preference

Scheme for Least Developed Countries

(LDCs)

DFTP Scheme provides duty free and

preferential market access on tariff lines

that constitute 92.5 % of global exports of

LDCs.