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26 Jul, 2020
India-EU Trade
• The EU is India's largest trading partner, accounting for €80 billion worth of tra...
25 Jul, 2020
India-UK Trade
• The size of India’s economy, now the world’s fifth largest (IMF, 2019), makes it...
27 Jul, 2020
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Advantage India

  • The current economic crisis being faced by India is a temporary phase and the country still remains the fastest growing economy in the world, and a favourable investment destination.
  • The strong manufacturing base is strengthened by 129.8 IIP during the FY 2020,131.9 as index of 8 core industries and USD 397.14 bn FYPE sectoral GVA with manufacturing PMI of 51.8 in March 2020.
  • India is on the path of becoming the hub in automation and technology with bigger industries like GE, Siemens and IPhone shifting their manufacturing base here and in addition to majors like Honda, Renault, BMW, Boeing, Toshiba, HTC which already have their factories in India.
  • India was the seventh largest manufacturer of commercial vehicles in 2019. It also exported defence products to 42 countries and has a target of surpassing $5 billion in the next 5 years. In terms of machine tools India stands 12th in production.
  • India’s elevation to automation as a part of industry 4.0 is evident from a projected 65% digitalization of manufacturing process by 2020.
  • With the Indian manufacturing sector poised to reach USD 1 trillion and have a 25% of GDP share by 2025, India has all the necessary ingredients for its major industrial push

Importance of Virtual Space:
Trade fairs and exhibitions play an instrumental role for potential supply individuals and buyers examining recent market trends and opportunities globally. Unfortunately, the global pandemic has influenced the utilisation of trade fairs to a major extent. Due to restrictions in mobility worldwide, physical trade fairs are getting cancelled and postponed in the present situation. Previously such shows have been pivotal for our exporters to explore new markets and introduce their products to new buyers. Many of the MSME exporters of our country have been able to get new contracts due to their participations in such shows. Therefore cancellation of these events has been a huge disappointment the revival of engineering exports from India. Hence, in order to ensure proper flow of business from around the world and to stabilise the supply chain and sourcing requirements even during this pandemic,  Virtual trade fairs, online marketplaces, B2B, e-catalogues etc backed by customised business matching services is the next best alternative. Furthermore, it is important for Indian exporters and MSMEs to reboot their businesses by helping them to meet either potential investors, new customers or suppliers through various trade initiatives. Supply chains now need to be extremely reactive to the situation, not only to survive but to thrive. Digital is the mantra of the day with every retailer, big and small, going digital to attract and keep customers. This will provide opportunities for business chambers and industry to flourish and deepen their future prospects.

EU and United Kingdom: Economic Scenario
The economic relations between EU and UK remains somewhat speculative due to the impact of  “Brexit" — the term used to describe Britain's EU departure — represents the most important constitutional shake-up the UK has known since it joined the six-nation European Economic Community in 1973. It is also the first time the European institution has lost a member.
The UK left the EU on 31st January 2020 bringing to an end of 47 years of British membership of the EU and the institutions that preceded it.  The main attention has now moved on to negotiating the future EU-UK relationship beyond a stand-still transition period that ends on December 31, 2020 — heralding abrupt and major changes unless there is an agreement. Despite the coronavirus pandemic, any extension of the transition agreement is yet to be known — although the full effect of the global health and economic crisis in the coming months remains to be seen.
The UK was a major player in the EU which served as both an asset to the Union. In all possibilities, after Brexit, the EU would become UK's biggest trading partner, and the UK will become EU's third biggest trading partner after the United States and China. The reintroduction of a customs border would have been economically and politically damaging to both sides. Hence, whether Brexit is judged to be success or not will depend to some degree on its economic impact. However, a range of different trade opportunities and arrangements are possible between the UK and European Union (EU), and other countries, post Brexit.
India-EU relations:
EU relations with India are amongst the first countries to establish diplomatic relations with the European Economic Community. With time both the countries expanded ties from the pillar of trade and economic cooperation and enabled political dialogue and annual ministerial meetings. The EU as a whole has been India’s largest trading partner while India is also EU’s largest trading partner.  EU is the largest source of Foreign Direct Investment (FDI) into India.
Indo-United Kingdom relations
India and United Kingdom share cordial and friendly ties. Bilateral relations between the two are based on common principles of democracy as well as common views on international trade. UK is among India’s major trading partners and during the year 2019, UK ranked 14th in the list of India’s top 25 trading partners.
As per trade statistics of MoC&I, India’s trade with EU in 2019-20 was US $16.87 billion out of which India’s export to EU stood at US$ 6.4 billion during 2019-20 compared to US$ 6.91 billion in 2018-19. On the other hand, India’s imports from EU stood at US$5.02 billion during 2019-20 compared to US$ 5.7 billion during 2018-19.
Since UK is still in a transition phase with EU and has not yet exited from EU post Brexit, India’s exports to UK constitute a major share percentage of the total exports to EU

Table 1: India’s trade with EU and UK
Value in US$ million
\Year 2014-2015 2015-2016 2016-2017 2017-2018 2018-2019 2019-20
India’s Export to EU 49491.7 44572.2 47292.1 53597.9 57172.3 53723.8
Growth %   -9.9% 6.1% 13.3% 6.7% -6.0%
India export to UK 9319.7 8828.5 8530.1 9691.1 9309.3 8733.5
%Growth   -5.3% -3.4% 13.6% -3.9% -6.2%
India's Export Share % to UK wrt EU 18.8% 19.8% 18.0% 18.1% 16.3% 16.3%
India’s import from EU 49236.4 43934.1 42384.6 47873.4 58425.1 51203.0
Growth %   -10.8% -3.5% 13.0% 22.0% -12.4%
India import from UK 5018.3 5192.5 3665.0 4806.8 7561.9 6712.6
%Growth   3.5% -29.4% 31.2% 57.3% -11.2%
India's Import Share % from UK wrt EU 10.2% 11.8% 8.6% 10.0% 12.9% 13.1%
India total trade with EU 98728.1 88506.3 89676.6 101471.3 115597.4 104926.8
India total trade with UK (share % 14338.0 14021.0 12195.0 14497.8 16871.2 15446.1
%Growth   -2.2% -13.0% 18.9% 16.4% -8.4%
Source: DGCI&S

Engineering is one of the major sectors of bilateral trade between India and EU among which trade with UK is noteworthy. India-EU engineering exports was registered at US$ 14.31 billion in 2019-20 compared to US$ 16.13 billion in 2018-19 witnessing a negative growth of 11.3%, comprising a share percentage of almost 19% out of total engineering exports. Engineering exports to UK for 2019-20 is valued at US$ 2.6 billion compared to US$ 2.8 billion during same period last fiscal registering a negative growth of 7.24%. India’s main engineering exports to the EU are machinery, boilers and parts, electrical machinery and equipment, iron and steel, vehicles and parts, articles of iron and steel, optical, medical equipments and parts, aircraft and spacecraft, aluminium and products, tools and parts, etc. The main imports from the EU to India are tractors, motor vehicles and parts, turbojets and other gas turbines, ferrous waste and scrap, machinery and other appliances, electrical machinery and equipments, etc.

Table 2: Top 15 engineering products exported to EU and export share % of UK during 2019-20 vis-a-vis 2018-19
Top 15 Engineering Sectors 2018-19 2019-20 Growth% Export to UK in 2019-20 Share %
Electric Machinery and Equipment 2641.7 2566.8 -2.8% 640.0 24.9%
Iron and Steel 2606.0 2113.0 -18.9% 79.4 3.8%
Products of Iron& Steel 1883.1 1759.1 -6.6% 296.5 16.9%
Auto Components/Part 1202.6 1105.4 -8.1% 151.0 13.7%
Industrial Machinery and parts 978.0 929.8 -4.9% 96.4 10.4%
Other Misc Items 694.5 660.4 -4.9% 116.4 17.6%
Ships, Boats and Floating bodies 153.3 659.1 330.1% 209.4 31.8%
IC Engines and Parts 801.5 607.3 -24.2% 128.2 21.1%
Aircrafts & Spacecrafts 676.7 490.1 -27.6% 172.4 35.2%
Aluminium and products 946.0 470.6 -50.2% 60.3 12.8%
 Medical and Scientific Instruments 446.2 402.7 -9.8% 81.3 20.2%
Machinery for ATMs 363.3 398.2 9.6% 85.9 21.6%
Motor Vehicle/cars 746.1 380.8 -49.0% 95.7 25.1%
Hand Tools & Cutting Tools 269.6 232.3 -13.8% 26.0 11.2%
Other Construction Machinery 262.9 215.3 -18.1% 111.1 51.6%
Total of top 15 products 14671.6 12991.0 -11.5% 2350.0 18.1%
Total engg exp to EU 16184.7 14352.9 -11.3% 2598.2 18.1%
Share % 90.7% 90.5%   90.4%  

EEPC India, the premier trade and investment promotion organization in India participates in major exhibitions in EU among which main prominent fairs occur in UK every year in a big way. Due to restrictions in mobility in case of such a global pandemic, EEPC India, one of the lead agency in organizing these events worldwide is also planning to organize these virtual exhibitions focusing on various engineering sub sectors.  These exhibitions are expected to help the businesses in boosting trade under the new normal scenario. EEPC India is creating a virtual platform worldwide in various engineering segments like subcontracting engineering products and precision equipments and machined components spreading awareness on India’s rapid progress in the engineering sector.
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