India's Modi denies third-party brokered peace with Pakistan
The South Asian rivals fought a four-day conflict in May that left more than 70 people dead on both sides before Trump announced a ceasefire between the nuclear-armed neighbours.
"No world leader asked us to stop the operation," Modi told parliament during a debate on "Operation Sindoor", the military campaign launched against Pakistan in May. Modi did not name Trump in his speech.
The prime minister instead claimed that it was Pakistan which had pleaded for the fighting to stop after feeling the "heat of our attacks".
The conflict erupted after gunmen attacked tourists in Indian-administered Kashmir in April, killing 26 men, most of them Hindus. India accused Pakistan of backing the attackers, an allegation Islamabad denied.
TRUMP'S CLAIMS DISMISSED
Trump has repeatedly said he was responsible for brokering peace between the two countries, including most recently on Monday.
"If I weren't around, you'd have, right now, six major wars going on. India would be fighting with Pakistan," Trump said during a visit to Scotland.
Modi's comments came after Rahul Gandhi from the opposition Congress party challenged him to state in parliament that Trump was "lying".
Earlier on Tuesday, Home Minister Amit Shah told lawmakers that three Pakistani gunmen involved in the April attack in Indian-administered Kashmir were killed during a military operation on Monday.
Shah said all three were Pakistani nationals and identified two of them as members of Lashkar-e-Taiba, a UN-designated terrorist group based in Pakistan.
ONGOING TENSIONS IN KASHMIR
Muslim-majority Kashmir has been divided between India and Pakistan since independence from British rule in 1947, with both nations claiming the region in full. They have fought two wars and several skirmishes over its control.
The May fighting pushed the neighbours close to another war before Trump announced a ceasefire. The opposition has since questioned whether there was third-party mediation, a claim New Delhi has consistently denied.
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Business Times
14 minutes ago
- Business Times
Switzerland hit with steep 39% tariff in US trade blitz
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Business Times
43 minutes ago
- Business Times
Most Asean nations get softer US tariffs to cushion growth risks ahead of Aug 7 hikes
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Despite reduced tariffs of 40 per cent each, they still face one of the highest rates the US has imposed on its global trading partners. Dozens of other countries have been hit with tariffs ranging from 10 to 41 per cent, and goods from nations not specifically listed will be levied a universal US import tax of 10 per cent. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up The 40 per cent tariff on transshipped goods now applies not only to Vietnam, but also to other countries – a move analysts largely see as aimed at China. However, uncertainties remain surrounding the rules of origin used to identify targeted shipments, as well as upcoming sector-specific tariffs. Maybank senior economist Chua Hak Bin said: ''China + 1' is not dead, as all Asean countries will face lower effective tariff rates than China. China's multinational corporations (MNCs) will likely consider having an alternative base, given China's high effective tariff rates of over 35 per cent.' The Trump administration also signalled that 'meaningful' agreements with certain nations are forthcoming, potentially leading to revised duties, as the US seeks to bring more trading partners in line with its economic and national security priorities. 'Don't assume this is the end of the story. Trump regards this as an ongoing reality show,' noted Stephen Olson, former US trade negotiator and visiting senior fellow at ISEAS-Yusof Ishak Institute. 'Developing countries, especially those in South-east Asia hoping to pursue export-led development models, will be especially hard hit,' he added. 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'MTI has confirmed this understanding with the Office of the US Trade Representative,' a ministry spokesperson said, referringn to the US' Executive Order released on Jul 31 (eastern time). 'We are closely monitoring developments and will seek clarification from our US counterparts as necessary,' the spokesperson added. The relatively low baseline tariff rate of 10 per cent should bring some relief to exporters in Singapore, economists said. 'Singapore is in a sweet spot and 'can live with it', as her reciprocal tariff is the lowest in Asia,' said Dr Chua, echoing similar remarks by the Republic's Prime Minister Lawrence Wong earlier this week. But companies looking to launch investments are likely still 'in a holding pattern' as they assess the frequent changes in tariff policies, said Denise Cheok, head of South-east Asia economics at Moody's Analytics. Trump's tariff letters state that the levies may change 'depending on our relationship with your country', noted Bernard Aw, the Asia-Pacific chief economist at credit insurer Coface. 'The certainty is that uncertainty will remain,' he said. With the fluid situation, he said companies likely have two plans ongoing – a short-term one to mitigate uncertainties, and a long-term plan to adjust to the new economic realities. The long-term one would entail reorganising logistics and shifting production, among other things. Even so, MNCs already in the city-state would likely maintain their presence, said Dr Chua. MNCs caught in a higher-tariff country may consider Singapore as a part of their supply chain. Still, Cheok estimates the baseline tariff could shave about 0.5 percentage points off Singapore's gross domestic product. 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Maybank analysts wrote in a recent note that Vietnam's steady rollout of private-sector reforms would cushion the impact of of the tariffs on external trade by promoting domestic investment and boosting the country's competitiveness as a destination for foreign direct investment. An improved business environment – characterised by reduced red tape, a more predictable legal framework, better education system and stronger local firms – is expected to broaden Vietnam's value proposition beyond being merely a low-cost destination, they added. Reported by Jamille Tran from Ho Chi Minh City Malaysia: Levelled playing field Just before the Aug 1 deadline kicked in, the US reduced the reciprocal tariff imposed on Malaysian imports to 19 per cent, down from the earlier 25 per cent rate, bringing the South-east Asian country in line with its regional peers. It also removes a key overhang for exporters, particularly in the electrical and electronics, as well as glove sectors. Hong Leong Investment Bank wrote in a note that from a trade standpoint, the harmonised US tariff rates across Asean ensure that Malaysia is not at a relative disadvantage. Ken Low, head of dealing at Moomoo Malaysia, noted that the tariff reduction offers short-term optimism. While the new rate is less damaging than the previous one, it remains on par with that of its regional peers, and continues to pose a hurdle to the competitiveness of Malaysian exports. In a statement on Friday, Malaysia's Ministry of Investment, Trade and Industry (Miti) stressed that the US-Malaysia tariff agreement was reached without compromising on the key 'red-line' issues protecting the country's sovereign economic policies. While negotiation details remain undisclosed – rare earths and halal standards were reportedly discussed – no specific concessions have been confirmed by the government. Miti said the government worked with Bank Negara Malaysia to model tariff scenarios and would implement targeted measures to support affected exporters and small and medium-sized enterprises. The tariff breakthrough coincides with the launch of a RM611 billion five-year development plan, which targets economic growth of 4.5 to 5.5 per cent, RM1.82 trillion in national revenue, and a fiscal deficit below 3 per cent by 2030. CIMB Treasury and Market Research said the combination of the lower tariff and strong fiscal planning should support investor sentiment and export resilience amid global trade uncertainties. Reported by Tan Ai Leng from Kuala Lumpur Indonesia: Room to breathe Indonesia, which is grappling with domestic economic pressures , has secured a final US tariff rate of 19 per cent on its exports, easing fears of the fallout from President Trump's Apr 2 rate of 32 per cent. 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While the shift in import sources may slightly weigh on the trade balance, the broader macroeconomic effects are expected to be manageable. Risks to the rupiah remain, but are likely to stay contained as long as Indonesia's commodity export prices remain stable. Reported by Elisa Valenta from Jakarta Cambodia: Double cuts to match peers Cambodia cheered the 'great news' of a 19-per-cent tariff on its US exports – a cut from the earlier 36 per cent and a significant drop from the original 49 per cent, which would have devastated its manufacturing sector and jarred its economy. The kingdom's Prime Minister Hun Manet took to Facebook on Friday morning to praise the 'excellent outcome', but analysts BT spoke with cautioned that Cambodia is not yet out of the woods. Adam Ahmad Samdin, an economist at research firm Oxford Economics, said that transshipments, the definition of which is left to the discretion of the US authorities, remain a bugbear for Cambodia, because its production is heavily reliant on Chinese inputs. The nation's post-pandemic economic expansion has been picking up speed, and annual growth has surpassed 5 per cent, but the double whammy of US tariffs and recent border disputes with neighbouring Thailand has clouded its outlook. Adam acknowledged that the reduced levy mitigates a substantial amount of downside risk to Cambodia's growth, noting that there remains scope for more immediate near-term support, as the kingdom improves its public debt ratio and rebuilds its fiscal space. Maybank economist Brian Lee added that border tensions will weigh on tourism, particularly in border areas, such as Poipet. Thailand is Cambodia's top source of international tourists. Nevertheless, the revised tariff brings Cambodia in line with its Asean neighbours and is lower than the rate imposed on its regional competitors (such as India) in the garment space, said Lee. He added that the risk of a sharp pullback in foreign direct investment is now reduced. The house expects Cambodia's growth to slow from 6 per cent in 2024 to 5 per cent this year and 4.6 per cent next year. Reported by Goh Ruoxue from Singapore
Straits Times
an hour ago
- Straits Times
'Win-win' and still pushing: Reactions to Trump tariffs
Sign up now: Get ST's newsletters delivered to your inbox Cambodia says the lower tariffs decided on by US President Donald Trump was the 'best news for the people and economy'. TOKYO – Some nations reacted with relief on Aug 1 after US President Donald Trump announced tariffs that, in some cases, were lower than threatened and delayed by a week to Aug 7. But others, including Switzerland and chip powerhouse Taiwan, still hope to negotiate lower rates, and uncertainty remains over transshipments and levies on Japanese cars. Mr Trump's announcement does not cover export giant China – currently in negotiations on a trade deal ahead of an Aug 12 deadline – but here is how other economies reacted: Thailand: 'Major success' The 19 per cent levy for Thailand and Cambodia – fresh from border clashes that killed over 40 people – is a let-off from the threatened 36 per cent. Thailand called it a 'major success' and a 'win-win approach aimed at preserving Thailand's export base and long-term economic stability'. The US trade deficit with Thailand hit US$45.6 billion (S$59 billion) in 2024. Its main exports include machinery, vehicles and auto components. Cambodia: 'Best news' Cambodian Prime Minister Hun Manet called it 'the best news for the people and economy of Cambodia to continue to develop the country'. Top stories Swipe. Select. Stay informed. 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But Washington also intends to impose a 40 per cent surcharge on goods transported to the United States via third countries, known as transshipments. This could hurt, in particular, nations in South-east Asia, whose production chains are closely linked to China. Many Cambodian factories, for example, are Chinese-owned and the White House has accused Cambodia of allowing Chinese goods to stop over on the way to US markets, skirting steeper rates imposed on Beijing. Experts, however, are unclear on how Washington will define these 'transshipment' goods. Taiwan: Still pushing Taiwanese President Lai Ching-te called its 20 per cent tariff announced by Mr Trump 'temporary… with the possibility of further reductions should an agreement be reached'. The US president had threatened to hit the island with a 32 per cent tax and possible duties on the island's huge semiconductors shipments. Soaring demand for Taiwan's AI chips industry has fuelled its trade surplus with Washington, putting it in the crosshairs of Mr Trump's tariff blitz. Washington 'needs Taiwan in supporting resilient supply chains, in supporting manufacturing and some high-end technologies', Vice-President Hsiao Bi-khim said recently. Switzerland: 'Great regret' Switzerland expressed 'great regret' that it was hit with 39 per cent, up from the threatened 31 per cent, despite its 'very constructive position'. The levy – more than double the European Union's 15 per cent – appeared to catch the rich Alpine nation off guard. Switzerland ranks sixth in terms of direct investment in the US, with pharma giants Roche and Novartis announcing major spending plans in recent months. Japan: Car confusion A tariff of 15 per cent agreed last week between Japan and Washington – down from a threatened 25 per cent – is due to be applied from Aug 7. But Japanese auto exports were already being hit by a 25 per cent rate, and Tokyo wants to know when this will be lowered too. 'We continue to urge the US to take prompt measures to implement the agreement, including lowering tariffs on automobile and auto parts,' Prime Minister Shigeru Ishiba said on Aug 1. Confusion also surrounds Mr Trump's claim that Japan – as a 'signing bonus' – will invest US$550 billion in America, which will recoup 90 per cent of the profits. Malaysia: 'Positive outcome' Malaysia also achieved a lower tariff of 19 per cent, down from 25 per cent, which the government called a 'positive outcome' . 'This decision by the United States reflects the strong and enduring economic ties between our two nations,' Trade and Industry Minister Zafrul Abdul Aziz said. Sri Lanka: 'Happy' Sri Lanka also expressed relief that it will face a 20 per cent hit, a sharp reduction from the 44 per cent originally floated, and expressed hope of a further cut. 'We are happy that our competitiveness in exports to the US has been retained,' Finance Ministry official Harshana Suriyapperuma told reporters. Around 40 per cent of Sri Lanka's US$5 billion of garment exports in 2024 went to the US. AFP
