Battleground WTO

Days after POTUS Donald Trump imposed steep tariffs on steel and aluminium imports to the United States, the office of the US Trade Representative (USTR) - the body responsible for developing and coordinating US international trade policies - has challenged India's export subsidy programmes at the World Trade Organisation (WTO). While the first move will raise a tariff barrier and, thereby, make steel and aluminium imports (including from India) less competitive, the second is aimed at attacking all the key incentives that India provides to help its exporters remain competitive in global markets. This includes sector-agnostic schemes like the Merchandise Exports from India Scheme, Special Economic Zones and Export Promotion Capital Goods Scheme, among others. Sectors likely to be directly hit include those that are the most promising - pharmaceuticals, chemicals, information technology products, textiles and apparels. India's steel and aluminium exports to the US are just a fraction of its total exports of these two commodities and that, perhaps, explained the country's silence over Trump administration's tariff hike. But the WTO challenge is certainly aimed at breaking the backbone of India's export strategy. The US seems to be driving India for a hard bargain, a give-and-take dialogue. Hence, the US-India dispute settlement consultations that will follow should not remain a one-sided affair. India needs to defend its position. Joe C. Mathew

MARKETS

Ups and Downs

Assets under management (AUM) of the mutual fund industry fell by 0.9 per cent month-on-month (m-o-m) to touch Rs 22,20,326 crore by February 2018. This is the third decline in the last six months - September saw a decline of 0.9 per cent and December saw a steep fall of 6.2 per cent. AUMs had reached an all-time high of Rs 22, 79,032 crore in November 2017. AUMs of all mutual fund categories fell in February except for liquid/ money market fund - it grew 1.4 per cent. Gilt funds witnessed the sharpest decline of 12.8 per cent; other exchange-traded funds category declined 4.2 per cent and equity-linked savings schemes fell 2.4 per cent. For the other exchange-traded funds, this is the first m-o-m fall since August 2015. Niti Kiran

POWER

Miles to go for Jaitapur N-plant

During french President Emmanuel Macron's recent visit, India and France signed an 'Industrial Way Forward Agreement' to construct the worlds biggest nuclear project at Jaitapur, Maharashtra. Experts, however, say the real way forward is still miles away. The Nuclear Power Corporation of India Limited (NPCIL) will set up six European Pressurised Reactors (EPR) of 10,000 megawatt (MW) with reactors supplied by French major Electricite de France (EDF) at the 900-plus hectare coastal area in Jaitapur.

NPCIL, however, has only a capacity of 6,000 MW so far and EPR is still an unproven technology though these are third-generation reactors developed over a decade ago. Olkiluoto in Finland (1600 MW), Flamanville in France (1600 Mw), Taishan in China (2by1600 Mw) and a proposed project at Hinkley Point in UK (2 EPRs) are being built on this technology. However, none of the four sites are up and running yet. They are facing design issues, delays and cost escalation.PB Jayakumar