Asia Pacific News
LAST UPDATE: June 2, 2025
India records 6.5% annual growth
India’s economy grew by 6.5% in the fiscal year ending March 2025, with a robust 7.4% growth in the January-March quarter, driven by agriculture and construction sectors.
Insight
India’s 6.5% GDP growth in FY25, though lower than the previous year’s 9.2%, underscores the economy’s resilience amid global challenges. The strong Q4 performance indicates a rebound, particularly in agriculture and construction. However, concerns persist regarding urban demand and private sector investment. The government’s focus on public capital expenditure and infrastructure development has been pivotal. Moving forward, sustaining this growth will require bolstering private investment and addressing global trade uncertainties.
Yomiuri: Japan May Help U.S. Bolster Supply Chains for Minerals, Chips
Japan is considering cooperation with the U.S. to strengthen supply chains for critical minerals and semiconductors, aiming to reduce dependence on China.
Insight
Japan’s initiative to collaborate with the U.S. on critical mineral and semiconductor supply chains reflects a strategic move to enhance economic security. By reducing reliance on China, both nations aim to mitigate risks associated with geopolitical tensions. This partnership could lead to joint investments, technology sharing, and the development of alternative supply sources. The collaboration also aligns with broader efforts to diversify global supply chains and promote stability in essential industries.
China establishes global mediation body in Hong Kong
China, along with over 30 countries, has established the International Organization for Mediation (IOMed) in Hong Kong to provide a platform for resolving international disputes through mediation.
Insight
The creation of IOMed signifies China’s ambition to play a more prominent role in global governance and dispute resolution. By promoting mediation over litigation, China positions itself as a proponent of peaceful conflict resolution. The choice of Hong Kong as the headquarters leverages its unique legal system, combining common and Chinese law, to facilitate international legal services. This move may enhance China’s soft power and offer an alternative to Western-dominated institutions like the International Court of Justice. However, the effectiveness and impartiality of IOMed will be scrutinized by the international community.
China Preps $70 Billion in New Capital to Supercharge Investment
China plans to allocate 500 billion yuan ($70 billion) to accelerate infrastructure projects, aiming to stimulate the economy amid challenges from U.S. tariffs.
Insight
China’s decision to inject $70 billion into infrastructure projects is a strategic response to counteract the economic impact of U.S. tariffs. By fast-tracking investments in infrastructure, China seeks to sustain economic growth and employment. This move also reflects a shift towards domestic consumption and self-reliance. The capital will likely be channeled through policy banks and may involve public-private partnerships. While this stimulus could bolster short-term growth, it raises concerns about increasing debt levels and the long-term sustainability of such investments. Monitoring the implementation and outcomes of these projects will be crucial.
China issues countrywide ban on Brazilian poultry imports
China has imposed a nationwide ban on poultry imports from Brazil following an avian influenza outbreak in a Brazilian commercial poultry farm.
Insight
The ban on Brazilian poultry imports by China underscores the vulnerabilities in global food supply chains, especially concerning animal health issues. Brazil, being the world’s largest chicken exporter, faces significant economic repercussions due to this ban. The situation highlights the importance of stringent biosecurity measures and transparent communication between trading partners. Additionally, it may prompt Brazil to diversify its export markets and invest in disease prevention infrastructure. For China, the ban reflects a cautious approach to food safety, but it may also lead to supply shortages and increased prices domestically. The incident emphasizes the interconnectedness of global trade and the ripple effects of localized health crises.
Japan’s government says it agreed with US to accelerate trade talks
Japan and the U.S. have agreed to conduct a new round of trade talks before the upcoming G7 summit in June, focusing on tariffs and economic security.
Insight
The agreement to accelerate trade talks underscores the urgency both nations feel in addressing escalating tariffs, particularly those affecting Japan’s automobile industry. Japan’s firm stance against the 25% tariffs on automobiles highlights the sector’s significance to its economy. The discussions also encompass non-tariff barriers and cooperation in areas like semiconductor supply chains and rare earths, reflecting broader concerns about economic security. The outcome of these talks could set a precedent for how major economies navigate trade disputes and collaborate on critical industries amid rising global tensions.
