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Google, Microsoft To Move Out Of China; Vietnam, Thailand Set To Benefit The Most

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The coronavirus pandemic has severely disrupted global business chains. Many companies and even some countries are now deciding to pull out from China and look for economic avenues elsewhere. Samsung, for instance, has decided to move production of its premier phones to Vietnam.

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China is currently the world’s production hub, but it may no longer remain that way post the coronavirus pandemic as companies have started to look for other economic avenues to move their production facilities, in order to reduce the dependence on China.

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According to the Nikkei Asian Review report, after the US-China trade war last year and the coronavirus outbreak in the current year, American technology giants Apple, Google and Microsoft are reportedly looking for shifting their production base outside China.

Google and Microsoft are looking at Vietnam and Thailand to manufacture their new phones, personal computers, and other devices amidst the coronavirus pandemic.

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Google is set to begin the production of its low-cost smartphone Pixel 4A and its flagship smartphone Pixel 5A in Vietnam. Google has also asked a long time manufacturer to help ready production lines in Thailand for its smartphone-related products and the first batch of the merchandise is expected to be shipped in the first half of 2020 itself.

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Microsoft too is scheduled to begin production if its notebook and personal desktop computers in northern Vietnam in the second quarter of this year at the earliest. Google started its shifting out from China last year as it asked one of its partners to covert an old Nokia facility to handle the production of Pixel phones while approving another facility in the same country.

Google also moved its data server center production to Taiwan last year to manufacture its Nest Wifi internet router.

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However, not just US companies, even Japanese and other European companies are reportedly looking to move out of China. According to South China Morning Post, a survey conducted by the German Chamber of Commerce in China and the European Chamber of Commerce in China said that almost half of the organizations that participated in the survey predicted a fall in profit margins by 20%.

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In-fact Japan has earmarked $2.2 billion dollars of its economic stimulus package to help manufacturers move out of China. Chinese President Xi Jinping was supposed to be on a state visit to Japan early this month, however, the visit was postponed due to the global pandemic.

A survey by Tokyo Shoko Research found that 37% of the 2600 companies that took part in the survey were looking for places outside of China.

Americas

US outraged with India for acquiring Russian jets over American F-21s

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India recently signed a 2.43-billion deal with Russia for the acquisition of MiG-29s and Sukhoi Su-30MKIs while overlooking American fighter jets including F-21s that the US claimed was a lethal combination of stealth F-35 and F-22 jets.

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Earlier, as EurAsian Times reported, US aerospace giant Lockheed Martin also said that it will not sell its newly rolled out F-21 fighter jet to any other country if India places an order for 114 planes, an offer aimed to counter other US, European or Russian jets.

Recently, amid escalating border tensions between India and China, New Delhi approved to spend billions to purchase Russian fighter jets. Moscow will sell New Delhi 33 new fighter aircraft including 12 Su-30MKIs and 21 MiG-29s along with up-gradation of 59 MiG-29s.

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The MiG 29 procurement and up-gradation from Russia is estimated to cost Rs 7418 cr, the Su-30 MKI will be procured from HAL at an estimated cost of Rs 10,730 cr.

Rahul Bedi a senior journalist and defence analyst write – the piddling issue of the US potentially sanctioning India under CAATSA for acquiring Russian military hardware including fighter jets to meet its urgent needs simply refuses to go away.

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In a statement to the UK’s Jane’s Defence Weekly after India declared its intent to procure Russian fighter jets, a senior US State Department official ominously announced that India was not ‘safeguarded’ from penalties under CAATSA.

Bedi quotes the US defence official – We urge all of our allies and partners to forego (defence) deals with Russia that risk triggering sanctions under CAATSA.

He further added that though the US could not “prejudge whether a specific transaction would result in sanctions, it was important to note that CAATSA did not have any blanket or country-specific waiver provision.

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There are stringent guidelines for considering a waiver, and each deal is assessed on a case-by-case basis,” Jane’s quoted the US official as saying. US Secretary of State (Mike Pompeo) has not made any judgment regarding the significance of any deal (with Russia) involving India, he added, but did not elaborate.

Bedi writes that the veiled CAATSA threat by the US, targeted at India for purchasing Russian fighter jets seems to be more a commercial bludgeon than a lawful effort to punish a politically intrusive Russia.

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Accordingly, it also leads to the clear picture that the CAATSA stems largely from US’ resentment with the Indian government for not acquiring US fighters like Lockheed Martin’s F-21 and instead opting for Russian Su-30MKIs and 21 MiG-29s.

The US has long been craving to sell the customized F-21s to India which was unveiled at Aero India 2019 in Bangalore.

Bedia writes that little more than a re-branded F-16 that dates back to the mid-1970s, it makes great economic sense from the US perspective to ‘sell’ India to licence-build this fighter for the IAF to meet its requirement for an additional 114 combat aircraft to make up for the depleted fighter squadrons.

Africa emerges as a new battle ground for India and China for trade, commerce war

With F-16s being phased out of the US Air Force, and their plant at Fort Worth in Texas closing down, moving the ageing fighters’ manufacturing unit to India, would keep the line going for few more years, while also providing employment opportunities in the US under Donald Trump’s ‘America First’ drive.

India going with Russia and French fighter jets has exasperated the US and could well be the motive behind its veiled threat of invoking CAATSA against India.

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Americas

US threatens Russia with consequences for paying bounties to Taliban in Afghanistan

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The US has threatened to respond if the Pentagon confirms reports of Russian bounties to kill US soldiers in Afghanistan. While Russia denies its involvement in any such operation, US-Russia relations could further deteriorate if the reports are confirmed.

The Pentagon is investigating reports of Russian bounties to kill US soldiers in Afghanistan and if found to be true, the US has promised to retaliate. Moscow on the hand has denied involvement in any such operation.

Speaking in front of the House armed services committee, General Mark Milley, the chairman of the joint chiefs of staff said that the Pentagon was committed to discovering whether Russian military intelligence had paid the Taliban for attacks on American soldiers in Afghanistan.

“We’re going to get to the bottom of this bounty thing. If there are bounties, I’m an outraged general, just like every one of us in uniform is,” Milley said. “That’s a real big deal. We don’t have that level of fidelity yet, but we’re still looking.”

Despite vowing to retaliate, Milley suggested that the US may not be responding to the reports as robustly as necessary in non-military ways. The 62-year old admitted that the US was perhaps not doing enough.

The issue is at the strategic level,” he said. “Is there diplomatic, and informational and economic … sanctions, are there démarches, are there phone calls, is there pressure, those sorts of things. And I can tell you that some of that is done.’’

Mark Esper, the defence secretary, was also testifying to the House armed services committee. Esper said that the reports did not come from any of the nine of the total of 17 US intelligence agencies under Pentagon’s authority, implying the information leaked to the press in recent weeks came from the Central Intelligence Agency (CIA) or another civilian agency.

The reports first came to notice in January and were ignored because they lacked credibility. It was only in February that Gen Kenneth McKenzie and the defence secretary became aware of them in February.

Milley confirmed that the investigation is not over and promised to get to the bottom of the situation. President Donald Trump has insisted he was not briefed on the Russian bounties.

Russia Denies Involvement

While American intelligence agencies work to confirm reports, Russia denies the existence or its involvement in any such operation. Moscow says the U.S. is trying to portray Moscow as an all-purpose bogeyman.

“I would like to say officially that these allegations, distributed by the media, are downright lies. No concrete evidence has been presented,” Russia’s ambassador to the U.S., Anatoly Antonov, said this week in an online forum with the Center for the National Interest.

Other Russian officials point out that Moscow would have little incentive to establish such a program given the high risk of getting caught.

According to NPR, the Russian military intelligence known as the GRU is believed to be behind the suspected Russian bounty program in Afghanistan. The GRU has an aggressive and high-risk culture and is hence preferred by Russian President Vladimir Putin.

The New York Times was the media outlet to report about Russia secretly offering money to the Taliban in exchange for killing American soldiers in Afghanistan.

If confirmed, it would be the first time the Russian spy unit was known to have orchestrated attacks on Western troops and could have a severe impact on Washington-Moscow relations.

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Americas

Trump Would Not Have Supported India In A Possible War Against China – US NSA

Now that India-China border clash has been somewhat deflated, former US NSA said – I’m not sure how much he (Donald Trump) understands the significance of the (India-China) border clash.

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As India has been aggressively confronting China with the hope of finding support from Washington, former US national security advisor (NSA) – John Bolton in an exclusive interview said there is no guarantee that Trump administration would have backed New Delhi in a possible India-China border clash.

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In an exclusive interview with Wion News, Bolton said – I’m not sure how much he (Donald Trump) understands the significance of the (India-China) border clash. I don’t think he (Trump) knows anything about the history of these clashes over the decades between India and China. He (Trump) may have been briefed on it, but history doesn’t really stick with him.”

 

 

Bolton further said – I don’t know which way he would go and I don’t think he knows either. I think Trump views the geostrategic ties with China for instance exclusively through the prism of trade. And trade is important because China has lifted intellectual property from the US and other nations, engaged in powerful technology transfers and it forms a major part of their economic success and therefore military power. And that’s really how far it goes.”

I don’t know what Donald Trump will do after the US presidential elections once the guard rail is removed. He’ll be back. He won’t be criticising China for putting Uyghurs in concentration camps or repressing Hong Kong. He will be back to the big China trade deal. So, if issues were to worsen between India and China, I’m not sure where he would come down,” he added.

On being questioned – if things were to escalate between India and China there is no guarantee that Donald Trump will back India against China?” Bolton said – that is correct.” I think his instinct for the next four months (till the elections) is to do anything that could hinder his election campaign. So what he would want is quiet along the border whether it benefits China or India.

Earlier, as EurAsian Times reported citing a Chinese expert for the Global Times – China has no plan to squeeze India’s strategic space and rather aims to explore ways for peaceful co-existence.  However, the author claims that this is endangered by the strategic objectives of some Indians who want to contain China with the help of the US.

He blames the Indian media for fanning the flames between India and China. Tensions are provoked by this pressure and hence there is relentless support for India to join the US, Australia and Japan to contain China, wrote the author.

The author blames the US for destabilizing the India-China ties and claims that the US has dangerously interfered in China-India relations, such as labelling India “the world’s biggest democracy,” talking up the “Mumbai model,” and unscrupulously showing partiality towards New Delhi amid the border dispute.

The US, in particular, is fascinating India to counterbalance China and the idea of the Indo-Pacific Strategy is turning into a reality. He says that Indian elites are keen towards working with the US because they believe that by joining the US camp to contain China, they are now a world power on equal footing.

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