INTERNATIONAL BUSINESS

DIGITAL ASSIGNMENT 3

19MBA0074
BALASUBRAMANIAN K
1.)Carry out a comparison of trade openness of your country with the major economies
of the world. Also examine its changes over the last two decades. Explore thereasons for
the same
India trade openness:
Trade openness one measure of the quantity to which a country is engaged in the global trading
system.Trade openness typically measured through the ratio among the sum of exports and
imports and gross domestic product (GDP).India is an amazingly open, freely trading
economy. It is to a few degree unreasonable to the general account of "adjustments" that is
mentally mainstream, yet consequences verify the equal. To begin with, take a gander at trade
–the often utilized size of receptiveness. Utilizing preferred proportions of exchange
receptiveness Trade/GDP, Tariff ranges –we discover that India is an astoundingly open
economy, in general phrases and on relative premise in opposition to developing business area
peers. Exports plus imports as percentage of GDP: For that indicator, we provide statistics for
India from 1960 to 2019. The average cost for India in the course of that length was
23.39% with no less than 7.66% in 1970 and a maximum of 55.79% in 2012. The modern-day
cost from 2019 is 40.02%. For evaluation, the world common in 2019 based totally on 142
nations is 95.25%.
India and France relation:
French global exchange accelerated by way of 5.62% in 2017 with French exports and imports
growing by way of 4.54% & 6.55% respectively over 2016 figures. In top ten category
products, there has been a decline in exports of aircraft & spacecraft whilst all different
products registered an boom in exports: nuclear reactors, boilers, equipment & mechanical
appliances, vehicles, electric machinery & system, pharmaceuticals, plastics articles, plastics
and articles thereof; beverages & spirits, essential oils optical/photographic/measuring units,
& iron & metallic. French imports additionally expanded with the aid of 6.55% in 2017. In
pinnacle ten category merchandise, there has been a decline in imports of aircraft and spacecraft
even as all other merchandise registered an increase: nuclear reactors, boilers, machinery and
mechanical home equipment, cars aside from railway or tramway rolling-stock, mineral fuels,
mineral oils & products, electrical equipment and system, plastics and articles
thereof,prescription drugs, optical/photographic/measuring units, natural chemical compounds
and iron & steel.
India exports to France:
India’s exports to France extended by way of 6.11% for the duration of this period with a
upward thrust in exports of following top 10 category merchandise: mineral fuels & oils
(85.16%); optical, photographic, cinematographic, measuring, checking, precision, clinical or
surgical gadgets and equipment & components thereof (28.73%); nuclear reactors, boilers,
machinery and mechanical appliances (13.26%); shoes (4.87%) & knitted or crocheted articles
of apparel & apparel accessories (1.84%). However there has been a drop in exports of cars
and components (-36.15%); electrical machinery (-17.42%); articles of apparel & clothing
accessories, no longer knitted or crocheted (-3.07%) & natural or cultured pearls (-3.04%).
 Source :tradingeconomics.com

India’s import from France:

India’s import from France reduced by -8.57% all through the equal length. Imports of
following pinnacle 10 ranked merchandise improved: optical, photographic, cinematographic,
measuring, checking, precision, medical or surgical instruments and equipment & elements
thereof (17.44%) & articles of iron & steel (8.61%). However, imports of following
merchandise reduced: electric machinery & equipment (-32.24%); iron & metal (-14.33%);
plane & spacecraft (-10.81%); natural chemicals (-3.06%); miscellaneous chemical
merchandise (-2.98%); plastics and articles thereof (-2.22%) & nuclear reactors, boilers,
equipment & mechanical appliances (-1.91%).

Source :tradingeconomics.com
French Investments in India:
France has emerged as a chief supply of FDI for India with extra than 1,000 French
establishments already found in India. France is the 9th largest foreign investor in India with a
cumulative investment of USD 6.24 billion from April 2000 to March 2018 which represents
1.65% of the overall FDI inflows into India in line with statistics supplied by the DIPP. The
highest FDI equity inflows are in the services quarter (19.30%), with cement & gypsum
merchandise (15.59%) in 2d region, followed through pills & prescribed drugs (5.23%),
industrial equipment (5.04%) and meals processing industries (5.03%).
Indian Investments in France:
There are over a hundred and fifty Indian businesses running in France (such as sub-
subsidiaries), employing around 7,000 human beings. Nineteen investments from India were
recorded in 2017 (+73%), developing or preserving 284 jobs (66%). Indian tasks often involved
decision-making centres (42% of projects), which includes a worldwide/European
headquarters, and production/manufacturing operations (32%). Investments had been
especially made in the software program and IT offerings zone (26% of projects and 52% of
jobs generated) and chemical compounds/plastics industry (21% of tasks, 23% of jobs), even
as place-wise, Indian groups invested basically within the Paris Region (Ile-de-France) (26%
of initiatives), Nouvelle-Aquitaine (16%), Bourgogne-Franche-Comté (16%) and Hauts-de-
France (16%).
Promoting trade and investment:
Promotion of economic and industrial family members between India and France is a prime
priority for the Mission and the E&C Wing, below the direction and steerage of the
Ambassador, works to sell Indian enterprise and enterprise by encouraging change and
investment, supporting Indian corporations with Government and personal zone contacts,
offering statistics, assisting and advising Indian agencies about the French market.
The principal commercial activities of the Mission encompass: (i) merchandising of Indian
items and services in France, (ii) merchandising of Brand India and company photo of India,
(iii) promoting of India as a foreign direct funding vacation spot and (iv) advertising of the
‘Make in India’ marketing campaign. In every of these sectors, the specific motion involves
information and intelligence accumulating, conversation and statistics dissemination, referral
sports, advocacy, logistic control and coordination sports.
Conclusion:
India France bilateral change stood at € 5.2 billion (-5.56%) as compared to the corresponding
duration the preceding 12 months. India’s exports to France expanded by 6.11% in the course
of this period with a upward thrust in exports. French exports to India decreased by -8.57%
during the same period.
Reference
Buisnessinsider Retrieved 07-SEP-2020,
https://www.businessinsider.in/top-10-largest-economies-in-the-
world/articleshow/70547252.cm
Tradingeconomics Retrieved 07-SEP-2020,
https://tradingeconomics.com/india/exports/france
Theglobaleconomy Retrieved 07-SEP-2020
https://www.theglobaleconomy.com/India/trade_openness
2.)Under the “most favored nation” principle of the WTO framework, no member
country can discriminate among its members whereas the PTAs are based on the
principle of preferential treatments to its members and discriminatory treatment of non-
members. This is against the fundamental of multilateralism under the WTO. How do
you justify the legal status of PTAs under the WTO? Discuss your arguments in details.
A preferential trade area is a buying and selling that offers preferential get right of entry to
sure products from the collaborating international locations. This is executed by using
lowering price lists however not by way of abolishing them absolutely. A PTA can be hooked
up thru a alternate percent. It is the first level of financial integration. The line between a PTA
and a free change location (FTA) may be blurred, as nearly any PTA has a fundamental
aim of turning into a FTA in accordance with the General Agreement on Tariffs and
Trade.These tariff preferences have created severa departures from the everyday exchange
relations precept, particularly that World Trade Organization (WTO) members ought
to practice the same tariff to imports from other WTO members.With the recent multiplication
of bilateral PTAs and the emergence of Mega-PTAs (wide regional alternate agreements
such as the Transatlantic Trade and Investment Partnership (TTIP) or Trans Pacific
Partnership (TPP)), a international exchange system exclusively controlled within the
framework of the WTO now appears unrealistic and the interactions among alternate
structures have to be taken into consideration. The accelerated complexity of the
international exchange device generated by means of the multiplication of PTAs have to be
taken under consideration in the have a look at of the choice of fora used by countries or areas
to promote their trade members of the family and environmental time table
The legal status of PTAs under the WTO:
One of the fundamental standards of trade liberalisation is that of non-discrimination as
enunciated in articles I of the GATT, II of the GATS, and IV of the TRIPS Agreement. This
precept, Most-Favoured-Nation (MFN),means that WTO individuals are not allowed to
discriminate among their trading partners.Thus, if a member grants a favour to one
member, it has to supply the identical favour to others. However, Paragraphs 4 to 10
of Article XXIV of GATT turned into delivered as an exception to this principle. It
allows the establishment of association between members thru which one member can
provide greater change conditions to different parties of the association and not to other
WTO members. The Enabling Clause, aimed at growing developing nations’ participation,
changed into also delivered as an exception to the MFN in favour of developing international
locations. It lets in the establishment of Preferential Trade Arrangements PTAs among those
countries.
The rules of PTAs appear to be too severe strict for developing international locations’
economy and must be revised for that reason. It appears that a growing united states of
america gains greater whilst it enters into an settlement with a advanced united states of
america. This is due to the fact trade performs an vital role in fostering development and
because elevated alternate with developing countries complements their export profits,
promote their industrialisation and inspire the diversification of their economies. The
WTO has installed region the “Special and Differential Treatment” to assist growing countries
and the EU has implemented the “Generalised System of Preferences” that's an association that
advantages least developed nations and territories while buying and selling with the EU.
Conclusion:
It must no longer be understood that change among developing international locations is
not recommended. My factor is that these international locations need to placed their
improvement objectives above their local commitments. Developing countries want
machineries, Foreign Direct Investment (FDIs) for the exploitation and transformation
of their natural assets. I do no longer see how any other growing country will help in this
case. Developing international locations should negotiate change agreements with evolved
international locations which are in a position to make investments in the exploitation
and transformation within the growing us of a. The WTO can assist in placing in area an
Agreement on the Trade in Natural resources which protects buyers, human rights and
the environment and to prevent developing nations’ leaders from reworking the precept of
permanent sovereignty over herbal resources into the principle of non-public sovereignty
over herbal resources. In doing this, the organization may want to put into effect fair trade in
natural sources that will suggest that no herbal assets need to be bought from international
locations where leaders are corrupt. PTAs between developing and evolved countries should
help in implementing those measures.

Refrence:
Pauwelyn, J., & Alschner, W. (2014). Forget About the WTO: The Network of Relations
between Preferential Trade Agreements
Mitchell, A. D., & Lockhart, N. (2009). Legal Requirements for FTAs Under the WTO.
Bilateral and Regional Trade Agreements