Piyush Goyal, Minister of Commerce | Photo credit: Anni
The current economic turbulence facing the world is not overnight, but rather the culmination of years of long-term unfair trade practices by China.
Commerce Minister Piyush Goyal said the starting point for economic turbulence comes when China is recognized as a member of the WTO.
All countries accepted China’s membership in the WTO and believed it would change the way they do business. The world was hoping China would bring transparency and adopt fair trade practices, he said at India’s Global Forum held here on Monday.
A large part of the world has been pulled away by China’s low-cost production, opening the door without measuring its long-term impact, he added.
Non-transparent trade practices
Throughout the process, China’s economy was booming, and it emerged as the second largest economy driven by untransparent trade practices, Goyal said.
China has adopted predatory pricing and vast subsidiaries to capture markets in different parts of the world. In this process, he said they have finished thriving domestic businesses in various countries.
India needs to be confident in China’s fair trade practices before strengthening its trade relations with its country.
China’s economy is subsidized in large quantities, with the prices of certain products crashing just to acquire a market for certain products in a particular country, Goyal said.
The trade deficit with India was at a comfortable level until Vajpayee became prime minister, but it inflated the decade when the UPA government signed an agreement with China, Goyal said.
Regarding tariffs imposed by the US, he said the applicable tariff rate in the US is only 7-8%, and is projected to be 17% as it is high for certain products that India has not imported.
The collection of low tariffs has nothing to do with the US. Customs war based on specific formulas. In fact, he added that India is friendly to all countries that adopt fair trade practices.
He said that companies could change more turbulent times and that firms India should learn to turn every challenge into opportunities, as was done between the Y2K issue and Covid in 1999.
Companies need to ensure the viability of downstream players and should not make short changes for cost-benefits, he said.
If they do that today, they will face the same fate when their upstream business cannot change them, he said.
India is ready to team up with countries that adopt fair trade practices with mutual respect, Goyal said.
Opening the door to BYD, just like Tesla, Goyal said the company should first be revived by the book and convince India that it will not use the country to throw away its products.
Released on April 7, 2025
