Us China  

Indian rupee appreciated by 28 paise against the USD in early trade. On Friday, rupee had settled for the day at 71.02 against the US dollar. President Donald Trump on Friday had said that the United States has reached a "very substantial" Phase 1 trade deal with China.

Many firms have been doing their sums and looking for new locations to re-site their manufacturing operations as the US importers are finding it more expensive to procure products from China. However, India and Indonesia have not seen many relocations from China make its way into the countries
 

USA is India’s single largest export market, while China is the largest market for the country’s imports. While the trade war between US and China presents an opportunity for India, the question is whether the country is working in the larger scheme of things
 

The Indian rupee opened at 70.73 against the US dollar in early trade on October 1. The Indian rupee declined 31 paise to close at 70.87 against the US dollar on September 30. Forex traders said globally risk appetite has plunged as US-China trade concerns continue to linger. 
 

Registering a rise of 17 paise over its previous close, the rupee opened at 71.87, and then gained further ground to touch a high of 71.67, at the interbank foreign exchange

The rupee depreciated by 9 paise to 71.57 against the US dollar in early trade on Wednesday. Forex traders said concerns about US-China trade spat kept market participants edgy. 

Hong Kong's financial secretary, Paul Chan, cut this year's official growth forecast to 0 to 1%, which could be the worst performance since 2009 during the global financial crisis. The previous forecast was 2% to 3%

Last month, additional tax was imposed on Chinese goods worth $ 200 billion. American manufacturers have been importing goods and spare parts for years from China. It is almost impossible for companies to uncouple from the global supply chain.

'The Chinese side made it clear to the United States that it should stop sending its vessels and military aircraft close to Chinese islands and reefs and stop actions that undermine Chinese authority and security interests,' said Yang Jiechi

After coming to power, Trump has been seeking to enter into bilateral trade deals with almost all his major trading partners. He has replaced North America Free Trade Agreement (NAFTA) with US Mexico Canada Agreement (USMCA)

The impact India feels will be indirect, as the cost of goods that are produced by American companies in China will increase and the US dollar strengthens due to the risk aversion caused in markets worldwide; however, owing to this domestic consumption-driven country's growth higher than 7.5% and the world's growth greater than 3.5%, the adverse effects will be minimal