FEBRUARYASIA BUSINESS OUTLOOK8NEWSROOMINDIA-OMAN FREE TRADE AGREEMENT TALKS PROGRESSING WITH KEY ROUND AHEADChina's economy is sending some mixed signals. On the one hand, consumer prices are rising at the fastest pace in five months, which suggests people are spending more. On the other hand, prices for goods that factories produce are still falling, indicating that manufacturing is struggling.Experts believe that this trend of falling factory prices will likely continue throughout the year unless the government can find a way to boost demand within China. And with the US imposing tariffs on Chinese goods, there's even more pressure on China to stimulate its economy.Looking at the numbers, consumer prices rose 0.5 percent last month compared to the same time last year, which is a faster increase than the 0.1 percent rise we saw in December. This increase was also higher than what economists were predicting. When we take out the fluctuating costs of food and fuel, the core inflation rate also went up, from 0.4 percent to 0.6 percent.One economist pointed out that while consumer prices might keep creeping up, factory prices probably won't be back in positive territory anytime soon because there's still too much production capacity for industrial goods. They even suggested that it might take a few more quarters before China's economy as a whole pulls out of this deflationary period.It's worth noting that these numbers were influenced by the timing of the Lunar New Year. Since the holiday fell in January this year instead of February like last year, it likely caused prices to rise as people stocked up on food and other goods for the celebrations. We saw particularly big jumps in prices for things like plane tickets, tourist activities, and movie tickets. The proposed Free Trade Agreement (FTA) between India and Oman is progressing well, and the two nations will convene again to resolve any remaining concerns. As stated by an official. Commerce and Industry Minister Piyush Goyal's recent trip to Muscat provided a significant uplift to the negotiations.On January 27, tradeministers from India and Oman convened in Muscat to explore the pr ogress of a possible agreement and advance the discussions. The agreement was talked about by Goyal and Qais bin Mohammed Al Yousef, the Minister of Commerce, Industry, and Investment Promotion in Oman.In November 2023, the formal negotiations for the agreement officially commenced under the title CEPA. Under these agreements, customs fees on a maximum quantity of goods exchanged between two trading partners are either significantly lowered or completely removed. Moreover, they relax regulations to promote service trade and attract investors.Within the Gulf Cooperation Council (GCC), Oman holds the third position for India's export markets. India and the United Arab Emirates, another member of the GCC, also share a related agreement that commenced in May 2022.Bilateral trade has declined from $12.39 billion (exports at $4.47 billion and imports at $7.91 billion) in 2022­2023 to $8.94 billion (exports at $4.42 billion and imports at $4.5 billion) in 2023­2024. India's main imports consist of urea and petroleum products. Over 70 percent of imports are sourced from them. Iron and steel, pet coke, gypsum, chemicals, along with propylene and ethylene polymers, are additional significant products. CHINESE ECONOMY FACES INFLATIONARY PRESSURE OWING TO TRUMP'S TARIFFS
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