It is only three months time since when the Hong Kong crisis deepened when the people of the country came in protest of a government proposal that would allow extraditions to mainland China, but now the bill remains suspended. While, the unending chaos could mean recession springing up in Hong Kong too, it has its repercussion felt world over.
Already the unending spat between the US and China is mounting fears of slowdown, and the emerging Hong Kong crisis only worsened the scenario. The equity markets world over tumbled and Hang Seng also sank but now there has been extended relief there.
To be noted Hong Kong jitters can continue on the Indian bullion markets:
As it is the prolonged US- China trade war sapped the demand for gold in Hong Kong, which serves as a conduit of goods to China and also accounts to be India's one-third export centre for gems and jewellery.
While the government of Hong Kong has now officially withdrawn the extradition bill, it is seen to be just a political retreat and any more aggravation on the front can result in the Hong Kong government feeling recessionary pressure.
If the unrest in Hong Kong "affects the flow of the buyers and the flow of trade, then the trend of these declining exports will increase," Ray, Executive director at the trade ministry-backed group said.
There is an upcoming huge trade fair, Hong Kong Jewellery & Gem Fair, to be organized later this month from September 16-22, in Hong Kong and as there are advisories issued against travel to the city given the prevailing turmoil, there are expected to be less footfalls and hence less of sales which is expected to further weaken India's exports.
It is to be highlighted that in an earlier PTI report, HKTDC said on Saturday said that the massive protest in Hong Kong would not impact its bilateral trade with India. For the fiscal year 2018-19, the trade value with India stood at around USD 31 billion.