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Prime Minister <keyword id="19895781" type="General" weightage="20" keywordseo="narendra-modi" source="keywords">Narendra Modi</keyword> urged CEOs of US majors to take advantage of India's growth story as the country is making all efforts to become the third largest economy of the world in his third term. India is currently the fifth largest economy of the world after the US, China, Germany and Japan with a GDP of around USD 3.9 trillion. India has been the fastest growing large economies of the world with GDP growth rate of over 7 per cent for the last three consecutive years. Addressing CEOs of the large US tech firms on Sunday, Modi said India will make every effort to become the third largest economy in the world in his third term (2024-29). Companies should take advantage of India's growth story for collaboration and innovation by co-developing, co-designing, and co-producing in India for the world, harnessing the opportunities from the country's economic and technological growth, he said. Assuring the business leaders of India's deep commitment to the protection of intellectual property and to fostering tech innovation, Modi highlighted the economic transformation happening in the country, particularly in electronics and information technology manufacturing and semiconductors. Modi asserted that his government was committed to making India a "global hub of <keyword id="20073013" type="General" weightage="20" keywordseo="semiconductor-manufacturing" source="keywords">semiconductor manufacturing</keyword>". The meeting took place at the Lotte <keyword id="19904497" type="General" weightage="20" keywordseo="New-York" source="keywords">New York</keyword> Palace Hotel on Sunday during the second leg of Modi's three-day US visit. It saw the participation of CEOs of 15 major US-based firms working on cutting-edge technologies such as AI, quantum computing and semiconductors. "Had a fruitful roundtable with tech CEOs in New York, discussing aspects relating to technology, innovation and more. Also highlighted the strides made by India in this field. I am glad to see immense optimism towards India," Modi said in a post on X. During the conference, Modi said technology collaboration and efforts such as the Initiative on Critical and Emerging Technologies (ICET) lie at the core of the India-US Comprehensive Global Strategic Partnership, according to a Ministry of External Affairs press release. Organised by the Massachusetts Institute of Technology (MIT) School of Engineering, the CEOs of top US tech firms, including Google CEO Sundar Pichai, Adobe CEO Shantanu Narayena, Accenture CEO Julie Sweet and NVIDIA CEO Jensen Huang attended the meeting. Others who participated in the roundtable included AMD CEO Lisa Su, HP Inc. CEO Enrique Lores, IBM CEO Arvind Krishna, Dr Noubar Afeyan, Chairman of Moderna, and Verizon CEO Hans Vestberg. Modi also talked about India's BIO E3 (biotechnology for environment, economy and employment) policy to develop the country into a biotech powerhouse and on the topic of AI, noted that India's policy is to promote AI for all, underpinned by its ethical and responsible use. The CEOs appreciated India's growing prominence as a global technology hub, driven by its innovation-friendly policies and flourishing market opportunities. They also expressed strong interest in investing and collaborating with India, agreeing that investing in startups would be a synergistic opportunity to innovate and develop newer technologies in the country. Others who attended the conference included Biogen Inc CEO Chris Viehbacher, CEO of Bristol Myers Squibb, Chris Boerner, Eli Lilly and Company CEO David A. Ricks, LAM Research CEO Tim Archer, GlobalFoundries CEO Thomas Caulfield, and the CEO of Kyndryl, Martin Schroeter. "Further cementing technology and business connect. PM @narendramodi interacted with the top tech leaders and CEOs of USA, in a Roundtable hosted by the Massachusetts Institute of Technology School of Engineering, in New York today. PM emphasised India's growth prospects and discussed initiatives to foster collaborations and innovation across diverse sectors," the official account of the MEA said in a post on X. The prime minister had a separate meeting with Krishna P Singh, CEO of Holtec International, which is into nuclear and solar power generation. They discussed Holtec's plan for expanding manufacturing in India and advancing energy cooperation, PMO India said in a post on X. Earlier on Sunday, Modi addressed the <keyword id="20115166" type="General" weightage="20" keywordseo="Indian-diaspora" source="keywords">Indian diaspora</keyword> at the packed Nassau Veterans Coliseum on Long Island in New York. He also held bilateral meetings with world leaders at the sidelines of the UN General Assembly session here. Modi reached New York on Saturday after attending the Quad Leaders' Summit hosted by President Joe Biden in Wilmington, Delaware. <div type="Article" hostid="261" msid="113516805" title="Why is Indian Prime Minister Narendra Modi visiting the US this weekend?" mstype="2" mssubtype="0"></div>

PM Modi invites US CEOs to take a 'byte' out of India's growing technology sector

India could see a shift in foreign direct investment (FDI) trends in the second term of Donald Trump (Trump 2.0) as President of the United States, says a research report by the State Bank of India. The report highlighted that under his first term, Trump 1.0, the Trump administration made sweeping regulatory changes aimed at attracting investments back to the U.S., which impacted FDI inflows globally, including India. It added that if similar policies are reintroduced in Trump 2.0 also, it could create challenges for emerging markets like India, which rely on FDI as a significant driver of economic growth. Notably, a recent Kotak report highlighted that a complete Republican control over all arms of the US government would mean increased US earnings via corporate tax cuts, higher tariffs on imports into the US and greater US fiscal deficits. The first two could spell doom for emerging markets like India and China, since foreign investors will make a beeline for investing more money in the US markets, which will come at the cost of intense selloff in emerging markets. However, higher fiscal deficits will eventually lead to the dollar weakening after the initial euphoria dies down. "India may see shifts in foreign direct investments (FDIs) during Trump 2.0. The Trump 1.0 administration saw significant regulatory changes aimed at attracting investments back to the US," the SBI report stated. However, given that India has been gradually diversifying its sources of FDI (foreign direct investments), this trend could serve as a buffer against any potential decline. Moreover, domestic institutional investors have been stepping up big time, maintaining some balance to the massive exodus of FIIs over the past month. So far in November 2024, FIIs have withdrawn Rs 19,849 crores from the cash segment in Indian markets, while DIIs have poured in Rs 14,014.18 crores as of November 10th, 2024. "India is no longer dependent on the traditional sources of FDI inflows... unlike the recent past, FDI is now coming in many new sectors," noted the SBI report. Unlike a decade ago, when most FDI inflows came from a limited number of traditional sectors, India is now attracting investment in a wide array of industries, including renewable energy, sea transport, medical devices, and surgical appliances. Data suggests over the last 24 years, i.e., between April 2000 and June 2024, FDIs have poured in $1,013.4 billion in the Indian economy. Out of this, 67%, i.e., $689.88 billion, has come in just the last 10 years. The report added there are up to 12 emerging sectors showing strong FDI interest, which could help offset any loss of inflows in conventional sectors if there is a shift in global investment patterns under another Trump administration. In the last financial year, the top 5 sectors that have received the highest quantum of FDI inflow include the services sector (finance, banking, insurance, and business) which makes up about 16% of the inflows. This is followed computer software &amp; hardware, which constitute around 15% of total FDI flows. Trading and telecommunications follows with a share of 6% each, and Automobile Industry comes next with a 5% share. In the short term, the potential for increased U.S. tariffs, more restrictive H-1B visa policies, and a stronger dollar could bring some volatility to India's trade and investment landscape. However, in the long term, these challenges might also encourage India to expand its manufacturing capabilities, diversify export markets, and focus on becoming economically more self-reliant. Notably, India has maintained a merchandise trade surplus with the U.S. despite tariffs imposed during Trump's first term. This indicates that Indian exports have remained resilient, and there is potential to strengthen this trade relationship further by capitalizing on emerging sectors and reducing dependency on traditional industries. Suman Chowdhury, Executive Director &amp; Chief Economist, Acuité Ratings &amp; Research Limited cautions that in the medium to long term, the trade relationship with the US may see a structural improvement. "Higher tariff and trade restrictions in the US with China should translate into better opportunities for exports of manufactured goods from India", he adds.

FDIs may shift to US under Trump 2.0 but it is unlikely to severely impact FDIs inflow to India, says SBI Report

<ul class="summary-list"><li>Morgan Stanley estimated that bringing manufacturing back to the US could add $10 trillion to the economy.</li><li>The bank pointed to a 20-year stagnation of the industrial economy as production was sent offshore.</li></ul>The US economy could unlock trillions in value over the next decade if more manufacturing activity comes back to the US, according to Morgan Stanley.After decades of production activity being sent abroad, domestic manufacturing is starting to come back to the US, the bank said, a phenomenon known as <a target="_blank" class="" href="https://www.businessinsider.com/reshoring-trade-investors-safe-haven-bet-regardless-of-election-winner-2024-8">reshoring</a>. If domestic production continues to scale, the economy could gain as much as $10 trillion in value over the next decade, according to Chris Snyder, a US multi-industry analyst at the bank."After decades of offshoring and relying on international supply chains, the pendulum is swinging back toward domestic production," Snyder said in a recent <a target="_blank" class="" href="https://www.morganstanley.com/ideas/thoughts-on-the-market-supply-chain?cid=SM_CORP_YOUTUBE_Morgan+Stanley_20241028&amp;linkId=636499587">episode</a> for Morgan Stanley's "Thoughts on the Market" podcast. "In fact, we believe the US is entering the early innings of <a target="_blank" class="" href="https://www.businessinsider.com/us-economy-reindustrializing-how-to-invest-manufacturing-cyclical-quality-2024-7">re-industrialization</a> — a multi-decade opportunity that we size at $10 trillion and think has the potential to restore growth to the US industrial economy following more than 20 years of stagnation," he added.The <a target="_blank" class="" href="https://www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/pmi/september/">manufacturing sector continued to contract</a> in September, with activity declining for the 22nd month out of the last 23, per the Institute of Supply Management.Still, the sector is showing signs that the US is backing backing away from offshore production. The US's international trade deficit for goods and services declined to $70.4 billion in August, down $8.5 billion from the prior month, according to the <a target="_blank" class="" href="https://www.bea.gov/news/2024/us-international-trade-goods-and-services-august-2024">Commerce Department</a>.The Biden administration, meanwhile, has poured billions into its <a target="_blank" class="" href="https://www.businessinsider.com/us-semiconductor-chip-production-continue-harris-trump-presidency-arizona-jobs-2024-10">push to increase chip production</a> in the US and boost<a target="_blank" class="" href="https://www.businessinsider.com/biden-to-sign-executive-order-to-boost-us-manufacturing-2021-1"> the manufacturing</a> and industrial sectors. As of February of this year, annual investment in new manufacturing facilities hit a record $225 billion, according to a <a target="_blank" class="" href="https://www.jec.senate.gov/public/index.cfm/democrats/2024/4/fact-sheet-the-manufacturing-renaissance-that-will-drive-the-economy-of-the-future">memo</a> from the Senate Joint Economic Committee.Shifting production back to the US is expected to be helped along by new technology, like artificial intelligence and more advanced robotics and automation, Snyder said. That could be a boon for "high-tech" sectors in the US, he later added, pointing to the semiconductor, pharmaceuticals, and advanced manufacturing systems industries.Traditional industrial firms — like those in the auto and aerospace sectors — and companies that invest in more sustainable manufacturing are also expected to benefit from the reshoring shift, he added."All told, these businesses should see shorter supply chains, reduced legal and tariff costs, and a more resilient operational structure."The cumulative effects could be "pretty profound" across the US economy, Snyder said, with the boost to industry and manufacturing bound to raise GDP. Reshoring could also potentially undo the US's trade deficit with other economies, Snyder said."The US — with its robust tech sector and innovation ecosystem — is uniquely positioned to leverage technology to revitalize its manufacturing base," he added.

Bringing manufacturing back to the US is a $10 trillion opportunity for the economy, Morgan Stanley says

Ahead of the union <keyword id="19936553" type="General" weightage="20" keywordseo="budget" source="keywords">budget</keyword> 2024, which is set to be presented on the 22nd July, finance minister Nirmala Sitharaman kicked off pre-budget consultations on 19th June. In their pre-budget memorandum to the <keyword id="19900485" type="General" weightage="20" keywordseo="finance-ministry" source="keywords" meta.keywordsubtype="org" meta.entityname="finance ministry" meta.hostid="261" meta.entityid="finance ministry">finance ministry</keyword>, the <keyword id="20366533" type="General" weightage="20" keywordseo="PHD-Chamber-of-Commerce-and-Industry" source="keywords" meta.keywordsubtype="org" meta.entityname="PHD Chamber of Commerce and Industry" meta.hostid="261" meta.entityid="PHD Chamber of Commerce and Industry">PHD Chamber of Commerce and Industry</keyword> proposed 10 reforms it deemed essential for <keyword id="19895063" type="General" weightage="20" keywordseo="India" source="keywords">India</keyword>’s journey towards <keyword id="19916816" type="General" weightage="20" keywordseo="Viksit-Bharat" source="keywords" meta.keywordsubtype="org" meta.entityname="Viksit Bharat" meta.hostid="261" meta.entityid="Viksit Bharat">Viksit Bharat</keyword>. Amongst the proposals submitted were introducing reforms to enhance the share of the manufacturing sector in India’s <keyword id="19904293" type="General" weightage="20" keywordseo="GDP" source="keywords">GDP</keyword> to 25% by 2030, and the expansion of the <keyword id="19981334" type="General" weightage="20" keywordseo="PLI-scheme" source="keywords">PLI scheme</keyword> beyond its existing scope of 14 sectors. In addition to this, <keyword id="20366532" type="General" weightage="100" keywordseo="PHDCCI" source="keywords" meta.keywordsubtype="org" meta.entityname="PHDCCI" meta.hostid="261" meta.entityid="PHDCCI">PHDCCI</keyword> also emphasised on rationalising direct taxes for the middle class, infrastructure enhancement and smart village development, with special focus on tier-2 and 3 cities. As per Sanjeev Agrawal, President, PHDCCI, “In order to strengthen the share of the manufacturing sector in the country's GDP, we recommend the status quo on the corporate tax rate at 22% for existing companies and 15% for new manufacturing companies incorporated after October 1, 2019. The middle class must be spared from the 30% tax rate and this rate must be applicable only to those with taxable income above Rs. 40 lakh, this will support consumption demand in this country”. In addition to this, PHDCCI also emphasised on strengthening linkages between universities and industries for bettering research and development activities in the country, and also appealed for reducing cost of doing business. Here’s a snapshot of some prominent demands placed forth by the PHDCCI ahead of the budget : <ol><li>Change in NPA classification limit from the present 90 days to 180 days</li><li>Fostering AI education, skill development and competitiveness in the service sector</li><li>Increase agricultural exports to US$100 billion in the next 3 years via increased public investments in infrastructure,</li><li>Ensure the presence of schools within a radius of 1 km, colleges within a 10 km radius and universities within a 25 km radius in the next five years.</li><li>Make health centres available within the radius of 1 km and hospitals within the radius of 10 km.</li><li>Propose a Voluntary Disclosure Scheme (VDS) for legal cases older than 10 years, offering settlement opportunities at a nominal 15% penalty. </li></ol>

Bolster manufacturing sector, consumption this budget: PHDCCI to FinMin

<ul class="summary-list"><li>US indexes fell steeply Tuesday as weak manufacturing data prompted fresh fears about the economy. </li><li>The ISM Manufacturing index failed to meet expectations, and investors are now awaiting August jobs data. </li></ul>Stocks plunged Tuesday as manufacturing data chipped at confidence in the US economy.The <a target="_blank" href="https://markets.businessinsider.com/index/s&amp;p_500?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">S&amp;P 500</a> and <a target="_blank" href="https://markets.businessinsider.com/index/dow_jones?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Dow Jones Industrial Average</a> shed 2% and 1.5%, respectively. The tech-heavy Nasdaq tumbled over 3%, as a sharp drop in <a target="_blank" href="https://markets.businessinsider.com/stocks/nvda-stock">Nvidia</a> compounded the index's decline.Tuesday's fallout marks the worst day for stocks since the market meltdown in early August and offered a grim introduction to September, which is <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/stock-market-outlook-september-season-fed-cuts-election-investing-2024-8?mrfhud=true">historically a bad month for the stock market</a>. A weak manufacturing print intensified pressure on Tuesday's sell-off, as the ISM Manufacturing Purchasing Managers Index failed to meet expectations. The index rose 47.2% in August, under 47.9% consensus forecasts."Manufacturing employment shrank for the third consecutive month as manufacturing activity slowed in recent months. Although the manufacturing sector holds a smaller portion of the macro economy now than in previous cycles, investors should still position themselves for a broader slowdown throughout the balance of this year," LPL Financial chief economist Jeffrey Roach said.As wavering manufacturing activity amplifies fears that the US may be facing a cooldown, investors have more reason to hope for a strong payrolls report on Friday.All eyes are on this jobs print, and any surprise in the labor data could make or break the soft landing narrative.Currently, economists anticipated that the US added 162,000 jobs last month, which suggests that the unemployment rate will edge down modestly from 4.3% to 4.2%.If forecasts are correct, the Federal Reserve should be able to cut interest rates by a gradual quarter point in its upcoming September meeting. But a weaker-than-expected payrolls print would prompt the bank to slash rates by more than the market is currently pricing in.Non-equity assets also suffered on Tuesday. While oil prices tumbled, the 10-year Treasury yield shed six points to 3.846%. Investors may need to brace for more volatility ahead, as September is famously a <a target="_blank" href="https://markets.businessinsider.com/news/stocks/stock-market-outlook-september-season-fed-cuts-election-investing-2024-8?utm_medium=ingest&amp;utm_source=markets">challenging month for stocks</a>.Here's where US indexes stood shortly after the 4:00 p.m. closing bell on Tuesday:<ul><li><a target="_blank" href="https://markets.businessinsider.com/index/s&amp;p_500?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">S&amp;P 500</a>: 5,528.93, down 2.12%</li><li><a target="_blank" href="https://markets.businessinsider.com/index/dow_jones?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Dow Jones Industrial Average</a>: 40,936.93, down 1.51% (-626.15 points)</li><li><a target="_blank" href="https://markets.businessinsider.com/index/nasdaq_composite?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Nasdaq composite</a>: 17,136.30, down 3.26%</li></ul>Here's what else is going on:<ul><li><a target="_blank" href="https://markets.businessinsider.com/news/stocks/nvidia-stock-prediction-nvda-sell-stock-market-inflation-rates-outlook-2024-9">Nvidia is flashing a sell signal,</a> veteran strategist Bill Blain warns.</li><li><a target="_blank" href="https://markets.businessinsider.com/news/stocks/stock-market-selloff-outlook-election-rate-cuts-jobs-tom-lee-2024-9">Stocks are set to drop as much as 10% in the next 8 weeks</a>, Fundstrat's Tom Lee warns.</li><li><a target="_blank" href="https://markets.businessinsider.com/news/commodities/gold-price-outlook-buy-continued-rally-next-year-2025-goldman-2024-9">3 reasons to buy up gold ahead of a 2025 rally</a>, Goldman Sachs says.</li><li><a target="_blank" href="https://markets.businessinsider.com/news/stocks/fed-interestrate-cuts-stock-market-bull-run-upside-outlook-jpmorgan-2024-9">Investors might be overestimating how far stocks will reach when the Fed cuts rates</a>, JPMorgan says.</li><li><a target="_blank" href="https://markets.businessinsider.com/news/stocks/stock-market-prediction-yen-carry-trade-bank-of-japan-rates-2024-9">Last month's stock market turmoil could repeat once rates rise in Japan</a>, Societe Generale says.</li></ul>In commodities, bonds, and crypto:<ul><li><a target="_blank" href="https://markets.businessinsider.com/commodities/oil-price?type=wti&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">West Texas Intermediate</a> crude oil shed 4.38% to $70.33 a barrel. <a target="_blank" href="https://markets.businessinsider.com/commodities/oil-price?utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Brent crude</a>, the international benchmark, plummeted 4.86% to $73.75 a barrel.</li><li><a target="_blank" href="https://markets.businessinsider.com/commodities/gold-price?utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Gold</a> stayed essentially flat at $2,523.1 an ounce.</li><li>The 10-year Treasury yield dropped six points to 3.846%.</li><li><a target="_blank" href="https://markets.businessinsider.com/currencies/btc-usd?utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Bitcoin</a> shed 0.66% to $58,077.</li></ul>

Stock market today: Nasdaq drops 3% as weak manufacturing data renews US growth fears

<keyword id="19991358" type="General" weightage="100" keywordseo="Indian-markets" source="keywords">Indian markets</keyword> are navigating choppy waters as global economic shifts, from rate cuts to evolving political climates, create new pressure points across the financial landscape, according to a recent report by ANI attributed originally to the Union Bank of India. The domestic stock and bond markets showed signs of strain, with <keyword id="19910363" type="General" weightage="20" keywordseo="bond-yields" source="keywords">bond yields</keyword> witnessing slight adjustments. India’s 10-year government bond yield dipped to 6.82%, a decrease from the previous session, reflecting cautious investor sentiment as the markets react to shifting global indicators. Meanwhile, the 5-year bond yield remained steady at 6.76%, a signal of lingering hesitation amid economic unpredictability. In the currency market, the rupee faced a notable decline, ending the day at ₹84.3725 against the US dollar, slipping from its prior close of ₹84.2800. Market analysts point to significant capital outflows as a key factor, with investors moving funds to perceived safer assets overseas. This migration has weighed heavily on the rupee, underlining the currency’s vulnerability in an environment of global economic flux. India’s stock market bore the brunt of this volatility, with key indices falling over 1%, effectively erasing the gains of a previous rally. This abrupt drop reportedly reflects renewed investor anxiety, largely triggered by the recent <keyword id="20189882" type="General" weightage="20" keywordseo="US-presidential-election" source="keywords">US presidential election</keyword> results. Experts suggest that the election has introduced a fresh layer of uncertainty, not only for the US economy but for global markets, impacting everything from policy decisions to investor sentiment. Analysts are also keeping a close eye on upcoming decisions by central banks, which will likely shape the path forward for the Indian equities market. Commodities showed contrasting trends, with Brent crude prices falling on lower demand expectations, as economic indicators point toward cautious spending globally. Gold, on the other hand, experienced a modest rise as investors sought refuge in safe-haven assets, highlighting a shift towards risk aversion among market participants. Globally, major central banks made coordinated efforts to sustain economic growth, with the Bank of England (BoE) announcing a 25 basis-point cut, lowering its benchmark rate to 4.75%. The BoE’s Monetary Policy Committee (MPC) largely backed this move to counter inflation, which has been declining, albeit gradually. Across the Atlantic, the US Federal Reserve mirrored this action with its own 25 basis-point cut, a sign of confidence in the ongoing economic recovery. Both rate cuts, though modest, signal a global trend towards caution as economies work to balance growth with stability. In Asia, the People’s Bank of China (PBoC) maintained its supportive stance. Governor Pan Gongsheng sought to reassure foreign investors by reaffirming the PBoC’s commitment to growth-oriented policies. Pan emphasized enhanced communication and pledged to open China’s financial services sector further, aiming to attract more international participants. Europe, meanwhile, faced mixed economic signals. Germany reported a steep 2.5% drop in industrial production in September, signalling a slowdown in manufacturing, while the Eurozone saw a mild 0.5% rise in retail sales, reflecting cautious consumer optimism in the region. Adding another layer to the global economic landscape, the European Union’s Climate Change Service warned that 2024 could be the hottest year on record, underscoring urgent climate challenges just as the UN COP29 climate summit approaches. The summit, set to take place in Azerbaijan, aims to rally increased funding for climate action, though tempered expectations linger in light of recent US political shifts. On the domestic front, Niti Aayog CEO BVR Subrahmanyam spoke about India’s potential role in pivotal global trade agreements, specifically the Regional Comprehensive Economic Partnership (RCEP) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). These partnerships, Subrahmanyam suggested, could bolster India’s Micro, Small, and Medium Enterprises (MSME) sector, which currently accounts for 40% of India’s exports, offering a strategic advantage for Indian trade in an interconnected world. As the Indian markets digest these developments, experts believe continued volatility could be the theme for the coming months. (with ANI inputs)

Indian markets under pressure as global rate cuts stir uncertainty, new report says

<ul class="summary-list"><li>South Korean companies invested more in the US in 2023 than any other country, per UN data.</li><li>The Inflation Reduction Act and CHIPS Act offer financial incentives for American-manufactured EVs, batteries, and chips.</li></ul>South Korean companies are investing billions of dollars in the US to take advantage of two big laws meant to boost American manufacturing.According to a <a target="_blank" class="" href="https://www.ft.com/content/dbc8208c-7fe2-41bf-a50d-f66abc65fde6">Financial Times</a> analysis of United Nations data, South Korean companies invested $21.5 billion in US projects in 2023, more than any other country. South Korea overtook Taiwan, which held the top spot in 2022.Samsung, LG, and Hyundai are among the South Korean companies committing billions of dollars to build facilities in the US to manufacture electric vehicles, batteries, and semiconductor chips. Much of the money is flowing to <a target="_blank" class="" href="https://www.businessinsider.com/best-economy-us-south-texas-florida-houston-dallas-nashville-miami-2023-12">southern states</a>, boosting jobs in the so-called <a target="_blank" class="" href="https://www.businessinsider.com/georgia-electric-vehicle-battery-manufacturing-inflation-reduction-act-clean-energy-2024-9">Battery Belt</a>.Yeo Han-koo, former trade minister of the Republic of Korea and a senior fellow at the Peterson Institute of International Economics, told Business Insider that US and South Korean interests in emerging technologies are perfectly aligned.Amid geopolitical uncertainty, the Biden administration is aiming to decouple US <a target="_blank" href="https://www.businessinsider.com/us-china-trade-war-tariffs-economy-election-janet-yellen-manufacturing-2024-4">supply chains from China</a> to compete in the <a target="_blank" class="" href="https://www.businessinsider.com/china-electric-vehicles-government-subsidies-win-ev-race-byd-tesla-2024-6">EV and chips race</a>. Meanwhile, South Korea — a longtime US ally — aims to build its global profile in high-tech and auto manufacturing.In particular, Yeo said, the 2022 Inflation Reduction Act and CHIPS and Science Act provide financial incentives for companies to invest in green technology in the US, bolstering South Korean commitments."In addition to these new geopolitical factors, these massive subsidies and tax incentives from the IRA and the CHIPS and Science Act really provide a good motivation for these Korean companies to invest in the US," Yeo said.<h2 id="b759499f-886b-4c14-8bae-91a8ccc1e284">South Korean companies are creating green tech jobs in the US</h2>According to the Financial Times analysis, over half of South Korea's outbound investments went to the US in 2023, up from 18% in 2019. During that same time, South Korean outbound investment in China decreased from 11% to 1%.Over a third of Korean project announcements in the US in 2023 were in the automotive or electronics sectors, including a <a target="_blank" class="" href="https://www.businessinsider.com/georgia-electric-vehicle-battery-manufacturing-inflation-reduction-act-clean-energy-2024-9">Kia plant in Georgia</a> set to take advantage of the IRA's $7,500 tax credit for buyers of US-made EVs.Similarly, in February, Hyundai <a target="_blank" rel=" nofollow" class="" href="https://www.prnewswire.com/news-releases/hyundai-announces-new-production-start-date-at-metaplant-america-during-hyundai-day-in-georgia-302071754.html#:~:text=Hyundai%20Motor%20Group%20is%20investing,that%20will%20employ%203%2C500%20workers.">announced</a> over $7 billion in investment in production facilities in Georgia. The company estimates their investments will create nearly 40,000 jobs in the state.And South Korean investments span across multiple states, mainly in the South. Samsung <a target="_blank" href="https://www.americanprogress.org/article/new-samsung-semiconductor-plant-in-taylor-texas/#:~:text=Samsung%20invested%20approximately%20%2417%20billion,artificial%20intelligence%20(AI)%20purposes">invested</a> $17 billion in a semiconductor plant in Texas that is expected to create thousands of jobs. LG recently <a target="_blank" href="https://www.queencreekaz.gov/Home/Components/News/News/13041/13">invested</a> $5.5 billion in building a battery plant in Arizona.Additionally, SK Hynix, Inc. <a target="_blank" href="https://news.skhynix.com/sk-hynix-signs-investment-agreement-of-advanced-chip-packaging-with-indiana/">announced</a> a $3.87 billion plant in Indiana to produce chips for AI products. The plant is expected to create nearly 1,000 jobs by 2030.Yeo said South Korea has an interest in becoming a competing player in emerging technologies, and the US needs allies to bolster its manufacturing."Reviving US manufacturing will be one of the most important economic policy objectives, but I mean, the US cannot do it alone," Yeo said. "The US needs a kind of partner in rebuilding this manufacturing, especially in these emerging new industries and supply chains."In the past decade, South Korean companies have <a target="_blank" href="https://gov.texas.gov/uploads/files/business/SouthKorea-Profile.pdf">created</a> about 7,000 jobs in Texas and <a target="_blank" class="" href="https://iedc.in.gov/events/news/details/2024/03/04/indiana-to-promote-booming-battery-ev-ecosystems-to-industry-leaders-in-south-korea">nearly 8,000 jobs</a> in Indiana.As the US reenergizes its manufacturing industries, Biden's inflation-fighting laws include provisions excluding businesses with supply chains connected with "foreign entities of concern," like China, Yeo said, to guarantee competition."Once you get the US subsidies, you are limited in terms of your flexibility to invest in China," Yeo said.Those provisions have incentivized South Korean companies to divert from China and focus more on the US.In May, South Korea's Ministry of Trade, Industry and Energy announced it committed $7 billion toward moving its supply chains away from China to further comply with US rules, according to <a target="_blank" class="" href="https://www.wsj.com/business/south-korea-plans-7-billion-push-to-pivot-ev-battery-industry-away-from-china-1fa1f189">The Wall Street Journal</a>.Furthermore, as high-tech products like EV batteries become a primary focus for US manufacturing, it makes business sense for South Korean companies to invest in plants directly in the US, Yeo said."These batteries, for example, are very bulky products," Yeo said, referring to EV batteries, which he said are cumbersome to ship. "So I think in the case of the battery industry, I think it also makes commercial sense to locate those factories close to the final market or end users."South Korean companies like LG and Samsung are designed to be global, Yeo said, and the US is often a target destination for large corporations.According to World Bank <a target="_blank" class="" href="https://data.worldbank.org/indicator/SP.POP.TOTL?locations=US">data</a>, the US population is above 330 million, while South Korea's population is just above 50 million."The US is the biggest market right now, and also still, the US market is considered to be very sophisticated," Yeo said. "When these global companies roll out new products, new technologies, they need to test it in the US market."To be sure, Yeo said it's important to recognize that trade is a complicated picture. China has been and continues to be one of South Korea's largest trading partners. While this moment provides business opportunities for South Korean companies in the US, the looming geopolitical tension with China creates uncertainty."With this geopolitical tension arising between the US and China, a lot of Korean businesses who had invested in China and had big kind of China operation are really kind of being squeezed between the US and China," he said.South Korean companies are committing to the US right now, but Yeo said political uncertainty over the presidential election encourages caution for international business."Korean companies have a first-mover advantage at the moment, but now also they are facing potential risk, depending on the outcome of the November election in the US," Yeo said.Nonetheless, Yeo said these investments would likely not make business sense without the subsidies and incentives provided by the Biden Administration's focus on manufacturing."Because of this combination of all these factors you see right now," he said, "Korean investments are really flooding into the US market." Are you trying to get a job building EVs or AI chips? Reach out at <a target="_blank" class="" href="mailto:jtowfighi@businessinsider.com">jtowfighi@businessinsider.com</a>

South Korea is going big on American manufacturing. The Battery Belt could benefit the most.

New Delhi, <keyword id="19895063" type="General" weightage="20" keywordseo="india" source="keywords">India</keyword>'s manufacturing sector growth climbed to a five-month high in February amid a sharper uptick in factory production and sales, supported by both domestic and external demand, a monthly survey said on Friday. The seasonally adjusted <keyword id="19916458" type="General" weightage="20" keywordseo="hsbc" source="keywords">HSBC</keyword> India Manufacturing Purchasing Managers' Index (<keyword id="19905748" type="General" weightage="20" keywordseo="pmi" source="keywords">PMI</keyword>) rose from 56.5 in January to 56.9 in February, pointing to the strongest improvement in the health of the sector since September 2023. In Purchasing Managers' Index (PMI) parlance, a print above 50 means expansion while a score below 50 denotes contraction. According to the survey, production rose at the fastest pace in five months and fuelled the quickest increase in sales since last September and the strongest expansion in new export orders for 21 months. "The HSBC final <keyword id="20786951" type="General" weightage="20" keywordseo="india-manufacturing-pmi" source="keywords">India Manufacturing PMI</keyword> indicates that production growth continued to be strong, supported by both domestic and external demand," said <keyword id="20412326" type="General" weightage="20" keywordseo="ines-lam" source="keywords">Ines Lam</keyword>, Economist at HSBC. Despite the uptick in growth momentum, manufacturing employment in India was little-changed. "Goods producers mentioned that payroll numbers were sufficient for current requirements," the survey said. On the inflation front, purchasing cost inflation retreated to a 43-month low, with selling charges increasing to a lesser extent as a result. The input costs witnessed the slowest rise in over three-and-a-half years. Manufacturing firms' margins improved as input price inflation slipped to the lowest since July 2020, Lam said. Besides robust domestic demand, new export orders rose at the fastest rate in nearly two years, with Australia, Bangladesh, Brazil, Canada, mainland China, Europe, Indonesia, the US and UAE as sources of demand growth. Manufacturing firms scaled up buying levels in response to greater production requirements, sustained increases in sales and to build safety stocks, the survey said. Going ahead, manufacturers have a bullish business outlook amid buoyant demand conditions. February survey data indicated sustained optimism among manufacturers regarding the year-ahead outlook for production. The overall level of confidence was the second highest since December 2022. "Buoyed by robust demand and improving profit margins, manufacturers have an optimistic outlook about future business conditions," Lam added. The HSBC India Manufacturing PMI is compiled by S&amp;P Global from responses to questionnaires sent to purchasing managers in a panel of around 400 manufacturers.

India's manufacturing sector growth hits five-month high in Feb on robust demand

Last week, the President of the United States, <keyword id="19919748" type="General" weightage="20" keywordseo="joe-biden" source="keywords">Joe Biden</keyword>, announced significant tariffs on a range of <keyword id="20139085" type="General" weightage="20" keywordseo="Chinese-products" source="keywords">Chinese products</keyword> to protect American workers from unfair trade practices. The targetted measures include a 100% tariff on <keyword id="6354973" type="General" weightage="20" keywordseo="electric-vehicles" source="Orion">electric vehicles</keyword>, a 50% tariff on semiconductors and solar cells, and a 25% tariffs on batteries, steel and aluminium products, some critical minerals, and essential health equipment like medical gloves, syringes and needles. In his address from the Rose Garden of the White House, Biden said America can continue to buy any kind of car they want, "but we're never going to allow China to unfairly control the market for these cars. Period." He claimed that the Chinese government has been investing state funds in various Chinese companies for years, spanning industries across the above-mentioned sectors. How does this brewing geopolitical <keyword id="20736760" type="General" weightage="20" keywordseo="trade-war" source="keywords">trade war</keyword> impact <keyword id="20742235" type="General" weightage="20" keywordseo="Indian-firms" source="keywords">Indian firms</keyword>? Experts say the impact could be in two ways, benefitting some sectors, while harming the few others. Let’s start with the bad news. <cmsannotation type="cmsannotation" annotationid="Threat to Indian firms" comment="subhead" text="Threat to Indian firms">Threat to Indian firms</cmsannotation> Beijing offers significant subsidies on most of these products, leading to surplus production that exceeds domestic and even regular export demand. Subsequently, Chinese companies are known to flood the global markets with surplus products at unreasonably low prices, forcing local manufacturers out of business in many countries, including <keyword id="19895063" type="General" weightage="20" keywordseo="India" source="keywords">India</keyword>. A prime example of this in practice can be found in the steel sector, where weak domestic demand is pushing the world’s largest steel producer China to offload surplus production into Indian markets at cheaper prices. Indian steel manufacturers are already struggling to compete with a glut of cheaper Chinese steel, with shipments nearly doubling year-on-year in the financial year ending March 2024. “India is already under grave threat of import because all major steel consuming economies are shutting their doors on these steel producing countries. We are highly vulnerable to surging and predatory import,” said Alok Sahay, secretary general of the Indian Steel Association, to Reuters. Global trade experts say that a majority of Chinese products are sold at unreasonably low prices in global markets because the companies in these sectors do not have to worry about profits. They are heavily subsidised by the Chinese government. <keyword id="20279291" type="General" weightage="20" keywordseo="Steel-Authority-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Steel Authority of India" meta.hostid="261" meta.entityid="Steel Authority of India">Steel Authority of India</keyword>’s (SAIL) chairman Amarendu Prakash also said that they are keenly watching Chinese imports after the US tariff increases. Additionally, China has been accused of employing anti-competitive strategies like compelling foreign companies to transfer their technology in order to operate in China. These factors have led to the US effectively shutting its door on several Chinese products through heightened tariffs, and other developed markets like Canada are also likely to follow suit. White House also emphasised that it continues to consult with its partners and allies who are facing similar threats from China’s unfair trade practices and are keen on taking action. If more and more global markets restrict entry of Chinese products, the risk of the majority of such products being dumped in neighbouring India increases drastically. Trying to block Chinese excess production "is like squeezing a balloon. It shrinks in one place and pops out in another," William Reinsch, a trade expert at the Center for Strategic and International Studies in Washington, tells Reuters. <cmsannotation type="cmsannotation" annotationid="An opportunity also arises" comment="subhead" text="An opportunity also arises">An opportunity also arises</cmsannotation> While some products risk being dumped into the Indian market, in a few other cases, Indian firms could benefit from fresh openings in the lucrative US market. "Of the products affected, India has opportunities in face masks, PPE, syringes &amp;needles, medical gloves, aluminium, iron, and steel. Opportunity may come in China also with retaliation, provided we have market access in products targeted by China," Ajay Sahai, Director General of the Federation of Indian Export Organisations (FIEO), told ANI. However, China is not likely to retaliate against the US tariffs at the moment, say experts, though the country’s Ministry of Commerce said it would take 'resolute measures to safeguard its own rights and interests' "China's economy is fragile. With household spending and the property market on the wane, manufacturing for export markets is one of its few bright spots. Beijing will not want to cut off its nose to spite its face. More broadly, China is desperately trying to encourage new foreign investment. Rash retaliatory action could spoil its case," Moody's Analytics explained in a recent report. Out of China's USD 420 billion exports to the US, only USD 18 billion is impacted due to the latest hike in tariffs — representing slightly over 4% and therefore considered marginal. But Sahai says that this market will continue to grow with time and provides an opportunity to India and other competitors to chip in the supply gap. Ajay Srivastava, the founder of the Global Trade Research Initiative (GTRI), also echoes Sahai’s opinions. He emphasised that the increased duties on Chinese face masks, syringes, needles, medical gloves, and natural graphite offer a substantial opportunity for India, as quoted by ANI. "By ramping up production and export of these in-demand products, India could enhance its trade footprint in the US market," he added. In terms of products like electric vehicles and semiconductors, India remains a net importer, and therefore, may not be in a position to capitalise right now. In the long term, however, as India begins semiconductor production at scale in 2025, there will be opportunities to export some of it to the US and other European countries, offering fresh impetus for domestic manufacturing. As the security risks associated with importing Chinese semiconductors prompts more and more trade barriers from the Western countries, demand for supply from India is likely to grow. Efforts are already underway for the establishment of four large semiconductor plants in India, with three located in Gujarat and one in Assam. Last fiscal year, Indian exports to the US dipped marginally by 1.32 per cent to $77.5 billion as against $78.54 billion in 2022-23. The new development now gives an unique opportunity to turn the tide over the next few years. Overall, some sectors like steel and aluminium do face a serious challenge due to the fresh US tariffs on Chinese products. However, the development will open new avenues for Western market entry and expansion for several other products. (With inputs from agencies)

US-China tariff war could benefit several sectors in India while harming a few others

<ul class="summary-list"><li>Intel is struggling to gain market share in the semiconductor industry.</li><li>Intel becoming a globally competitive US chip manufacturer is vital for the US economy.</li></ul>US government officials are counting on Intel to lead the country's <a target="_blank" href="https://www.businessinsider.com/us-semiconductor-chip-production-continue-harris-trump-presidency-arizona-jobs-2024-10">chip manufacturing</a> renaissance but the company is struggling to meet expectations.Intel becoming a globally competitive US chip manufacturer is "imperative for the US economy and national security," said Stephen Ezell, the vice president for global innovation policy at the Information Technology and Innovation Foundation and the director of its Center for Life Sciences Innovation. That's because the US needs to secure its domestic supply chains of the chips that power items like iPhones, washing machines, and <a target="_blank" href="https://www.businessinsider.com/china-ai-nvidia-us-bockade-smuggling-2024-8">military equipment</a>.When it comes to bringing advanced chip manufacturing to American shores, the US government is short on options. Jimmy Goodrich, senior advisor for technology analysis to the RAND Corporation, told BI that only three companies in the world are manufacturing the most advanced, "leading edge" chips: Intel, Samsung, and TSMC. Intel is the only company in this trio that is based in America — Samsung's headquarters are in South Korea and TSMC is based in Taiwan.If Intel falls short, there is "reasonable concern that advanced fabs will not be sustainably available in the US," said Dylan Patel, the chief analyst at the semiconductor research and consulting firm SemiAnalysis.While Samsung is building a chip factory in Taylor, Texas the company has postponed taking deliveries of chipmaking equipment because it has yet to land any major customers for the project, Reuters <a target="_blank" href="https://www.reuters.com/technology/samsung-delays-taking-deliveries-asmls-chip-gear-its-new-us-factory-sources-say-2024-10-18/">reported</a> in October. TSMC is <a target="_blank" href="https://www.businessinsider.com/tsmc-making-apple-iphone-chips-helps-us-semiconductor-bet-2024-10">producing chips for Apple</a> in its Phoenix-based factory and has plans to build two more factories in the city. However, the company has historically preferred to invest in Taiwan, Patel said.These conditions are why Intel's recent struggles have <a target="_blank" href="https://www.businessinsider.com/intel-dow-jones-ai-chip-lag-2024-11">raised concerns</a> among some government officials. In August, the company announced it would be <a target="_blank" href="https://www.businessinsider.com/intel-layoffs-cost-cutting-measures-pay-cuts-reduced-perks-2024-10">parting ways</a> with roughly 15,000 workers through voluntary separation agreements and layoffs. On October 31, the company reported its <a target="_blank" href="https://www.nytimes.com/2024/10/31/technology/intel-earnings-loss.html">biggest</a> quarterly loss ever. The third quarter loss was driven by slowing demand for the chips that power personal computers, struggles to gain market share in the booming AI chips sector, and significant investments in its chip manufacturing technology.To be sure, Intel's third-quarter revenue <a target="_blank" class="" href="https://www.reuters.com/technology/intel-reports-third-quarter-loss-forecasts-q4-revenue-above-estimates-2024-10-31/">beat</a> expectations, and executives said the company is making progress on executing a <a target="_blank" href="https://www.businessinsider.com/intel-ceo-pat-gelsinger-turnaround-plan-aws-2024-9">turnaround plan</a>. In September, Intel announced it will be expanding its collaboration with <a target="_blank" href="https://www.businessinsider.com/intel-ceo-pat-gelsinger-turnaround-plan-aws-2024-9">Amazon Web Services</a>, and the company is optimistic that its new <a target="_blank" class="" href="https://www.businessinsider.com/intel-chips-act-funding-all-hands-meeting-2024-11">18A chip</a> —which it's expected to start producing next year — will help it gain market share in the industry.However, industry analysts told Business Insider that competing with the likes of <a target="_blank" href="https://www.businessinsider.com/tsmc-suspend-ai-chip-production-china-us-2024-11">TSMC</a> and <a target="_blank" href="https://www.businessinsider.com/nvidia-ai-chip-semiconductors-tsmc-intel-jobs-arizona-2024-2">Nvidia</a> will be an uphill battle — in part due to a series of <a target="_blank" class="" href="https://www.businessinsider.com/intel-dow-jones-ai-chip-lag-2024-11">strategic missteps</a> Intel has made over the past two decades.Another potential wild card is whether a <a target="_blank" href="https://www.businessinsider.com/what-second-trump-term-means-for-intel-2024-11">Trump administration</a> — specifically its proposed <a target="_blank" href="https://www.businessinsider.com/companies-raising-prices-trump-tariffs-inflation-goods-getting-more-expensive-2024-11">tariff policies</a> — would aid or hinder Intel's turnaround efforts. President-elect Donald Trump has expressed <a target="_blank" class="" href="https://www.businessinsider.com/us-semiconductor-chip-production-continue-harris-trump-presidency-arizona-jobs-2024-10">support</a> for boosting domestic chip manufacturing but has <a target="_blank" class="" href="https://www.businessinsider.com/what-second-trump-term-means-for-intel-2024-11">criticized</a> the CHIPS Act, a key Biden administration initiative that companies like Intel are counting on for funding.An Intel spokesperson told BI that the company's recent quarterly earnings demonstrate the "tangible progress" the company is making on its turnaround strategy. They added that the goal of making the US a leader in semiconductor manufacturing was a priority in the first Trump administration and continues to have bipartisan support."We look forward to working with President-elect Trump and his administration to advance America's technology and manufacturing leadership," they said.<h2 id="3cef0621-01c3-4b2a-b136-2affb93b6fc9">Intel's problems have ramifications outside the company</h2>The stakes aren't just high for Intel employees and executives: Intel is the largest recipient of funding from the <a target="_blank" href="https://www.businessinsider.com/intel-chips-act-funding-all-hands-meeting-2024-11">CHIPS Act</a>, which included $52.7 billion in tax breaks and subsidies intended to bolster the US semiconductor industry. The Biden administration bet that boosting domestic chip manufacturing would make the US less reliant on chips sourced abroad from TSMC, which produces, by some estimates, about <a target="_blank" href="https://www.businessinsider.com/asml-tsmc-semiconductor-chip-equipment-kill-switch-china-invade-taiwan-2024-5">90%</a> of the world's advanced chips. Additionally, fears of a <a target="_blank" href="https://www.businessinsider.com/ai-taiwan-china-chip-war-2024-6">Chinese invasion</a> of Taiwan complicate the US's dependence on TSMC.Intel was awarded $8.5 billion in grants and $11 billion in loans through the CHIPS Act, which it plans to use to supplement the over <a target="_blank" href="https://www.intel.com/content/www/us/en/newsroom/news/us-chips-act-intel-direct-funding.html">$100 billion</a> it's committed to expanding its operations in Arizona, Ohio, New Mexico, and Oregon. Like most companies, Intel hasn't received any of these funds yet. Recipients are required to meet certain benchmarks — which can include building a chip fab or securing customers — before the funding is doled out and Intel hasn't met those milestones yet.In response to the company's struggles, government officials have discussed whether it should receive <a target="_blank" href="https://www.businessinsider.com/intel-dow-jones-ai-chip-lag-2024-11">additional financial support</a> or merge its chip design business with a competitor. Last month, The <a target="_blank" class="" href="https://www.nytimes.com/2024/10/24/us/politics/intel-chips-biden.html">New York Times</a> reported that Gina Raimondo, the US secretary of commerce, urged chief executives from Google, Microsoft, Apple, Nvidia, and other firms to <a target="_blank" href="https://www.businessinsider.com/intel-dow-jones-ai-chip-lag-2024-11">buy chips from Intel</a>."Our Q3 results underscore the solid progress we are making against the plan we outlined last quarter to reduce costs, simplify our portfolio, and improve organizational efficiency," CEO Pat Gelsinger said on the company's earnings call on October 31.

Intel is far from becoming the American chipmaking powerhouse the US needs

<ul class="summary-list"><li>High tariffs on China could prevent the US defense industry from getting needed supplies, a Beijing advisor said.</li><li>"If those military enterprises do not have supply from China, they will not be able to continue with their production."</li></ul>The US defense sector will face big repercussions if Donald Trump launches tariffs against China, an advisor tied to Beijing's government said.Ding Yifan, a senior fellow at the State Council's Development Research Center, told international media that Trump's protectionist policies would prevent US defense manufacturers from accessing needed supplies."If those military enterprises do not have supply from China, they will not be able to continue with their production," he said, as cited by the <a target="_blank" href="https://www.ft.com/content/6d0484e8-e65f-478d-8548-4e3aa37ed339">Financial Times</a>. These "severe consequences" would extend to other American sectors dependent on cheap Chinese parts.Ding's commentary is among the most explicit pushback from China since Trump's election win. Though details remain scarce, the president-elect has pledged a 60% tariff rate on imports from the world's second-biggest economy.Trump has argued that these policies will <a target="_blank" href="https://www.businessinsider.com/trump-tariff-plan-inflation-policy-impact-trade-war-china-rates-2024-5">fix trade imbalances</a> while directing investment in domestic businesses. His administration has also suggested that high tariffs boost the country's <a target="_blank" href="https://www.youtube.com/watch?v=wjxhW_lkWps">negotiating power</a>.But Ding reframed the idea as costly for the US, citing that a large part of American business relies on intermediate goods from China."Downstream American companies will not be able to find substitute products in a very short period of time if Chinese companies are not able to provide them with the products," he warned.Meanwhile, the defense sector's dependence on Chinese producers is not minimal. In September, RTX CEO Greg Hayes said that the aerospace giant was looking for alternatives to replace <a target="_blank" href="https://www.reuters.com/business/aerospace-defense/rtx-sees-labor-challenges-exploring-alternatives-china-suppliers-2024-09-10/">roughly 2,000 Chinese suppliers</a> it relied on.To be sure, it remains to be seen how Trump's tariff ideas actually pan out.According to a Monday note from JPMorgan, the incoming administration may prefer to implement lower rates on goods where China is the dominant supplier. If tariff rates are differentiated this way, the bank expects a modest impact on US GDP.So far, the defense sector appears distracted by other developments tied to Trump's presidency.As concern has grown that Trump's cost cutting <a target="_blank" href="https://www.businessinsider.com/vivek-ramaswamy-doge-wants-to-delete-entire-federal-agencies-2024-11">Department of Government Efficiency</a> could weigh on the sector, the <a target="_blank" href="https://markets.businessinsider.com/etfs/spdr-sp-aerospace-defense-etf-us78464a6313">S&amp;P Aerospace and Defense ETF</a> is down about about 4% since last Monday.

You Searched For "Manufacturing sector in US" and got 11 results

PM Modi invites US CEOs to take a 'byte' out of India's growing technology sector

PTI

FDIs may shift to US under Trump 2.0 but it is unlikely to severely impact FDIs inflow to India, says SBI Report

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Bringing manufacturing back to the US is a $10 trillion opportunity for the economy, Morgan Stanley says

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Bolster manufacturing sector, consumption this budget: PHDCCI to FinMin

Ira Alok Puranik

Stock market today: Nasdaq drops 3% as weak manufacturing data renews US growth fears

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Indian markets under pressure as global rate cuts stir uncertainty, new report says

BI India Bureau

South Korea is going big on American manufacturing. The Battery Belt could benefit the most.

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India's manufacturing sector growth hits five-month high in Feb on robust demand

PTI

US-China tariff war could benefit several sectors in India while harming a few others

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Intel is far from becoming the American chipmaking powerhouse the US needs

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Trump's China tariffs would cut into US defense production, Beijing advisor says

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