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Business Standard
an hour ago
- Business
- Business Standard
US-Indonesia trade deal shows risks of pressure, India must be wary: GTRI
The US-Indonesia trade pact reflects how Washington's pressure tactics can compel countries to cut tariffs, commit to large purchases, and loosen regulatory control, and India should tread cautiously in ongoing trade talks to avoid similar concessions, economic think tank GTRI said on Wednesday. Indonesia gave up far more than it gained, removing 99 per cent of its tariffs on US goods, agreeing to buy $22.7 billion in American products, and weakening important rules that protected its industries, food safety, and digital space, the Global Trade Research Initiative (GTRI) said. "India now faces similar US demands, including allowing remanufactured goods, opening up agriculture and dairy, accepting genetically modified (GM) feed, and adopting US rules on digital trade and product standards," GTRI Founder Ajay Srivastava said. He added that accepting American standards on cars, medical devices, or food, without any guarantee of reciprocity, would put India's consumers at risk. "Handing over control of data under the name of digital trade would give foreign companies power over India's digital future. India must stay alert. Any trade agreement should be based on clear, public assessments of costs and benefits," Srivastava said. Concessions especially on critical areas like food, health, digital, and IP (intellectual property) must be fair, reciprocal, and aligned with India's development needs, he added. "Otherwise, India risks giving up long-term control for short-term gains, a decision it may regret later," he said. India and the USA are negotiating a bilateral trade agreement. So far, five rounds of talks have been completed, and the sixth round will happen here next month. Both sides are looking to finalise an interim deal before August 1, the deadline for suspended Trump tariffs. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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First Post
3 hours ago
- Business
- First Post
Who's paying Trump's tariff bill? Not foreign countries as he claims but American firms, people
Even though US President Donald Trump has claimed that foreign countries pay tariffs to the US government, the fact remains that tariffs are borne by American people and companies. The declining profits of companies and rising costs are proof of Americans paying for tariffs. read more US President Donald Trump may have convinced his far-right base that foreign countries pay for tariffs, but the fact remains that tariffs are borne by US companies and public — and it is finally reflecting in data. Tariffs are taxes that importers in the United States pay to the US government on goods bought from countries facing tariffs. For example, if there is a 35 per cent tariff on Chinese goods, importers in the United States buying goods from China would pay 35 per cent of the goods' value to the US government in tax. STORY CONTINUES BELOW THIS AD American businesses, including some of the most recognisable companies like General Motors (GM), have reported tariff-induced losses. The reason is that they are hesitant to pass on the increased costs of tariffs to costumers out of fears of a fall in sales. ALSO READ: Even as Trump wages tariff wars, 75% Americans don't know what it means Economists, however, have said that it is only a matter of time that businesses pass most of these increased costs to customers. Americans are paying for tariffs — despite whatever Trump says In a research note, Deutsche Bank concluded that Americans are definitely paying for tariffs. If foreigners were paying for tariffs, we would expect to see a sharp reduction in the price of imported goods as they absorbed it into their own margins, but the data show only mild price reductions, mainly from Canada and, to a lesser extent, the United Kingdom, the bank noted. The analysis concluded three things: Firstly, exporters abroad 'are not yet feeling much pain from the tariffs', which could strengthen their bargaining power ahead of the August 1 trade deadline. Secondly, there may be 'more pressure on US consumer prices in the pipeline'. Thirdly, as the economic cost is falling more heavily on American businesses and people, the situation adds 'an added dollar negative' to the broader macroeconomic outlook. ALSO READ — Trump's tariffs & mass-firing: Economists fear 'stagflation' is on the horizon Trump's reasons behind tariffs are many — and all of them are either false or misplaced. Firstly, Trump has said he would make countries pay with tariffs for purported unfair trade practices. As explained above, it is a false claim as importers pay tariffs, not the other countries. STORY CONTINUES BELOW THIS AD Secondary, Trump has said tariffs will disincentivise imports and fuel domestic manufacturing. This is a misplaced idea as modern-day manufacturing relies on spares and machinery from across the world and a tariff war makes sourcing difficult. For example, China has a near-monopoly on the world's rare earth supplies, which are used in nearly everything today from household electronics to cars and fighter planes. After Trump slapped tariffs, China leveraged the near-monopoly and forced Trump to blink. US businesses take a hit The GM on Tuesday reported a loss of 35 per cent in the second quarter, including a $1.1 billion hit from Trump's tariffs. In the first half of the year, Jeep- and Fiat-owner Stellantis projected a $351.1 million tariff-induced loss. For the entire year, the projected loss is $1.17-1.76 billion. Raytheon Technologies has also lowered the targets. Tech giants like Apple, Nvidia, Tesla, Google-parent Alphabet, Amazon, and Meta have also seen decline in value from market losses. Moreover, Trump is way off the target in tariffs. While he set out to get $6 trillion in revenue from tariffs, he has so far only crossed the $100-billion mark. STORY CONTINUES BELOW THIS AD
TimesLIVE
3 hours ago
- Automotive
- TimesLIVE
Trump tariffs take a $1bn bite out of GM earnings; shares fall
General Motors' second quarter earnings took a $1.1bn (R19,305,825,000) hit from tariffs, but the carmaker beat analyst expectations for the period, supported by strong sales of its core petrol trucks and SUVs. The largest US carmaker by sales said it expects the tariff impact to worsen in the third quarter and stuck to a previous estimate that trade headwinds threaten to hit the bottom line by $4bn (R70,198,998,400) to $5bn (R87,748,748,000). GM said it could take steps to mitigate at least 30% of the impact. Shares fell about 6% in early trading. The carmaker's revenue in the quarter ended June 30 fell nearly 2% to about $47bn (R824,838,231,200) from a year ago. Its quarterly adjusted earnings per share fell to $2.53 (R44.40) compared with $3.06 (R53,71) a year earlier. Analysts on average expected adjusted profit of $2.44 (R42,82) per share, according to data compiled by LSEG. GM's adjusted earnings before interest and taxes was among corporations that revised annual guidance due to the impact from US President Donald Trump's tariffs, lowering it to an annual adjusted core profit of between $10bn (R175,501,993,000) and $12.5bn (R219,377,491,250). The company on Tuesday stood by the forecast. Beyond tariffs, GM's underlying business in the quarter was solid. Sales in the US market – its main profit centre – rose 7%, while the company continued to command strong pricing on its pickup trucks and SUVs. GM swung back to a small profit in China, after losing money there a year before. Analysts said GM may need to cut investment in future projects or find other ways to trim spending to offset the effect of tariffs. Jeep-maker Stellantis on Monday warned tariffs would significantly affect results in the second half of 2025, and said tariffs cost it about €300m (R6,177,180,000) in the first half of the year. Shares of rival Ford Motor and US-traded shares of Stellantis fell about 1% on Tuesday morning. The carmaker took steps in recent months to bolster its combustion-engine operations through increased investment in its US factory base, calling into question its goal of ending the production of petrol-powered cars and trucks by 2035. GM announced in June it would invest $4bn at three US facilities in Michigan, Kansas and Tennessee, including a plan to move production of the Cadillac Escalade and increase output of its two big pickup trucks. It added production of its previously Mexico-produced Chevy Blazer to the Tennessee plant. The carmaker imports about half the vehicles it sells in the US, mainly from Mexico and South Korea. Crosstown rival Ford produces about 80% of its US-sold vehicles domestically. Car companies are increasingly shifting their focus to bolstering the core lineup of petrol trucks and SUVs as the growth rate of EV sales has slowed. Demand for battery-powered models has slowed after rapid growth earlier this decade. The trend is intensified by the pending disappearance of government support for the battery-powered models. Sweeping tax and budget legislation approved by the US Congress will eliminate $7,500 (R131,658) tax credits for buying or leasing new electric vehicles and a $4,000 (R70,217) used-EV credit at the end of September.
Business Standard
3 hours ago
- Business
- Business Standard
GIFT Nifty hints towards positive start; Trump announces 'massive' trade deal with Japan
GIFT Nifty: GIFT Nifty August 2025 futures were trading 37 points higher in early trade, suggesting a positive opening for the Nifty 50. Institutional Flows: Foreign portfolio investors (FPIs) sold shares worth Rs 3,548.92 crore, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 5,239.77 crore in the Indian equity market on 22 July 2025, provisional data showed. Global Markets: Markets in Asian traded in the green, with Nikkei leading the gains, after President Donald Trump announced the signing of a "massive trade deal with Japan. The deal includes reciprocal tariffs of 15% on the countrys exports to the U.S., with auto duties reportedly being lowered to that level as well. Japanese Prime Minister Shigeru Ishiba reportedly said that he needed to examine the deal before commenting. Additionally, the news that Washington had reportedly achieved agreements with the Philippines and Indonesia encouraged investors, giving them hope that other nations may also reach arrangements to avoid the worst of the US president's levies. The announcements boosted hopes that other deals could be in the pipeline, though talks with the European Union and South Korea reportedly remain elusive for now. Equity markets have been rising in recent weeks on hope that countries will eventually sign trade deals with the US. This is despite the fact that there haven't been many agreements reached with Trump, despite the deadline of 01 August 2025. On Wall Steet, the Dow Jones Industrial Average and other indexes eased off the day's highs while the S&P 500 set another new high in the final minutes of trading Tuesday, as investors grinded though countless quarterly financial results. According to media reports, the S&P 500 companies are expected to report a 7% increase in earnings on average for the second quarter, with technology heavyweights driving much of that gain. Meanwhile, U.S. trade policy remains a major point of uncertainty for investors and companies as Trump's self-imposed 01 August deadline for many countries to reach agreements with the White House approaches. On Tuesday, GM tumbled after the automaker reported a $1 billion hit from tariffs to its quarterly results, adding more fuel to investor concerns about U.S. President Donald Trump's global trade policy. The recent rally in Wall Streets most valuable companies has been fueled by the optimism about heavy spending on artificial intelligence. Following the mixed economic data released last week, reports suggest that the market has trimmed its expectations about interest-rate cuts from the U.S. Federal Reserve at next week's policy meeting. The market now expects about a 60% chance of a reduction in rates at the September meeting. Domestic Market: Domestic equity benchmarks closed mostly flat today, registering slight losses as investor sentiment remained cautious. Market participants continued to grapple with uncertainty ahead of the August 1 deadline for a potential U.S. trade agreement. The Nifty index settled just below the 25,100 mark. All sectoral indices on the NSE ended in the red, with PSU banks and realty stocks experiencing notable declines. The S&P BSE Sensex declined 13.53 points or 0.02% to 82,186.61. The Nifty 50 index fell 29.80 points or 0.12% to 25,060.90.
Business Standard
4 hours ago
- Business
- Business Standard
Nasdaq Dips as GM and Lockheed Slide; Housing and Gold Stocks Rally Strongly
Despite subdued overall trading, housing and gold sectors surged, offsetting tech losses. GM and Lockheed declines weighed on broader sentiment. The tech-heavy Nasdaq fell 81.49 points (0.4%) to 20,892.69, the S&P 500 inched up 4.02 points (0.1%) to 6,309.62 and the Dow climbed 179.37 points (0.4%) to 44,502.44. General Motors (GM) plunged by 8.1% after the automaker reported second quarter earnings that exceeded analyst estimates but were down sharply year-over-year. Lockheed Martin (LMT) also tumbled by 10.8% after reporting weaker than expected second quarter revenues. Overall trading activity was somewhat subdued, however, with a lack of major U.S. economic data keeping some traders on the sidelines. Housing stocks substantially moved upside, driving the Philadelphia Housing Sector Index up by 6.7% to its best closing level in over five months. D.R. Horton (DHI) helped lead the sector higher, soaring by 17% after reporting better than expected fiscal third quarter results. Gold stocks were significantly strong , as reflected by the 3.1% jump by the NYSE Arca Gold Bugs Index. With the gain, the index reached its best closing level in over twelve years. Oil service, biotechnology and steel stocks also saw considerable strength while semiconductor, networking and computer hardware stocks moved downwards. Asia-Pacific stocks turned in a mixed performance. Japan's Nikkei 225 Index slipped by 0.1%, while China's Shanghai Composite Index climbed by 0.6%. Meanwhile, European stocks moved mostly lower on the day. The German DAX Index slumped by 1.1% and the French CAC 40 Index slid by 0.7%, although the U.K.'s FTSE 100 Index bucked the downtrend and inched up by 0.1%. In the bond market, treasuries saw further upside following the notable advance seen in the previous session. Subsequently, the yield on the benchmark ten-year note which moves opposite of its price, fell 3.6 bps to 4.33%.
