:00:00. > :00:08.Press rewind. The US and Japan. And flying high, Indian carriers are
:00:09. > :00:11.expanding their reach in aviation. Good morning, Asia. Hello, world.
:00:12. > :00:16.I'm Rico Hizon. Thank you for investing your time in Asia Business
:00:17. > :00:22.Report. It's a Thursday. We start off with Japan's Prime Minister,
:00:23. > :00:26.Shinzo Abe. He has his work cut out for him when he meets with US
:00:27. > :00:30.President Donald Trump tomorrow. This is important symbolically.
:00:31. > :00:36.Shinzo Abe is the first Asian leader to meet the new US president. The
:00:37. > :00:42.stakes are high. President Trump has had direct criticism of Japanese
:00:43. > :00:50.companies and Japan. It has put them on again. Last month he criticised
:00:51. > :01:00.Toyota Motors. They said they would invest more in America. The fall in
:01:01. > :01:04.the yen is a reflection of the relationship between the US and
:01:05. > :01:10.Japan in the 1980s. Are we in for deja vu? There is a huge difference
:01:11. > :01:13.between what happened in the 1980s and is now. At the time, the
:01:14. > :01:18.deficit, how much Japan was selling to the US in comparison to how much
:01:19. > :01:24.the US was selling to Japan was a really wide gap. That situation is
:01:25. > :01:27.not the same today. If anyone can be accused of dumping products into the
:01:28. > :01:32.US it would be the other favourite sort of villain in the story that
:01:33. > :01:38.President Trump likes to bring up, that is China. The deficit between
:01:39. > :01:42.Japan and the US has really shrunk comparative to the US GDP over the
:01:43. > :01:47.last three decades. And Japan is going to try to point out that there
:01:48. > :01:51.are massive differences between what was going on then and what is
:01:52. > :01:57.happening now. So, with this fear of a protectionist policy from the
:01:58. > :02:06.Trump administration, it seems like the Japanese are trying to be more
:02:07. > :02:08.aggressive in, basically, building a relationship with the Donald Trump
:02:09. > :02:13.administration. Well, they don't have much of a joint. Back in the
:02:14. > :02:17.1980s, one of the major considerations for Tokyo to give in
:02:18. > :02:23.to concessions was the political factor. Basically, Japan needs
:02:24. > :02:27.Washington as a major US ally in its backyard. The Seine is today. The
:02:28. > :02:35.situation on that front has not changed. -- autor. Things like
:02:36. > :02:40.autos, trade, that is what will be on the agenda. And for analysis of
:02:41. > :02:44.the meeting with Donald Trump in Washington, DC with Shinzo Abe, you
:02:45. > :02:49.can read more on her blog topic that is on the website, BBC .com. Japan
:02:50. > :02:58.is not the only country nervous about a trade war under the
:02:59. > :03:02.administration. I asked which Asian economies will be affected the most.
:03:03. > :03:09.I think the US border adjustment task will hit Vietnam the hardest,
:03:10. > :03:13.along with Korea, Taiwan, and Malaysia. These are the economies
:03:14. > :03:17.which export a lot to the US. The nature of their products,
:03:18. > :03:22.electronics, durable goods, they are highly responsive to price changes.
:03:23. > :03:27.If there is a price hike in the US they will be impacted the most. If
:03:28. > :03:34.that is true, by how much could this impact Gross Domestic Product and
:03:35. > :03:42.economic growth? By adulation, even with the direct impact, it could be
:03:43. > :03:46.in the tune of 0.6 - 0.9% of the GDP. That is significant already.
:03:47. > :03:50.That could have knock-on impacts with domestic investment as well.
:03:51. > :03:55.So, in countries like Vietnam, it could be bigger than 1% GDP. A
:03:56. > :04:01.knock-on effect on the direct investment and a lot of lost jobs in
:04:02. > :04:05.these countries. Yes. Potentially, it will not just be investment. It
:04:06. > :04:11.will have an impact on employment which would also impact consumption.
:04:12. > :04:14.So we are really thinking about the potential scaling down of some of
:04:15. > :04:20.these trade related impacts which could really impact the economy. So,
:04:21. > :04:25.how can many of these Asian economies which could be impacted by
:04:26. > :04:33.the trade pacts basically skirt the reduction in growth? Is it through
:04:34. > :04:39.bilateral agreements with the United States? I think that is probably one
:04:40. > :04:43.channel. At a company level, there will be a great incentive to invest
:04:44. > :04:47.and have domestic presence in the United States. Of course, that will
:04:48. > :04:52.be viable for some industries, but not be labour intensive industry,
:04:53. > :04:57.for example. It is not the easiest thing to do. It depends on the
:04:58. > :05:00.industries, what you can do. The second thing is they will probably
:05:01. > :05:05.look to each other more, increasing trade within the region. I think
:05:06. > :05:12.China, ASEAN, there will be a great amount more of Chinese regional
:05:13. > :05:18.investment to counter this. In other business news, we have what looks
:05:19. > :05:24.like a case of mistaken identity. Snapchat announced its plans last
:05:25. > :05:27.week. That seems to have gotten some investors slightly ahead of
:05:28. > :05:36.themselves. Shares of the completely unrelated company called Snap
:05:37. > :05:42.Interactives has since soared by more than 160%. Shares of the actual
:05:43. > :05:52.Snapchat company, Snap Inc, will start trading only a week from now.
:05:53. > :05:55.There was an announcement that all restrictions on cash withdrawals
:05:56. > :06:01.will be removed from next month in Mumbai. The decision not to cut
:06:02. > :06:06.rates may have come at a huge surprise for the markets and
:06:07. > :06:09.investors. The decision to remove all curbs on cash withdrawals has,
:06:10. > :06:16.the huge relief for people all across the country. In 2016, there
:06:17. > :06:22.were restrictions regarding how much money people could withdraw from
:06:23. > :06:28.banks and ATMs. It was a surprise move to withdraw two high-value
:06:29. > :06:32.rupee notes from the system. The head of the Reserve Bank said that
:06:33. > :06:36.it is reasonably confident that by next month, the situation will be
:06:37. > :06:40.under control. There will be enough liquidity in the system. It is why
:06:41. > :06:44.it is confident banks will be in a position to provide the new currency
:06:45. > :06:50.notes without any problems. BBC News, Mumbai. Staying with India,
:06:51. > :06:56.their airlines are flying high, with the middle-class flying at even
:06:57. > :07:02.greater volumes. They are rushing to expand their fleet to take advantage
:07:03. > :07:06.of the growth. This one is one of them. They are paying for a new
:07:07. > :07:11.Boeing aircraft. They had to close operations a few years ago due to
:07:12. > :07:17.financial difficulties We have the details. For airlines, India has
:07:18. > :07:20.always been a land of opportunity. A growing population, rising
:07:21. > :07:25.disposable incomes, and an increasing thirst for travel, these
:07:26. > :07:29.are helping the aviation sector in the country finally take off. When
:07:30. > :07:34.Indians have extra money on hand, they usually buy things like cars
:07:35. > :07:37.and gadgets. But now more than before, they are choosing to travel,
:07:38. > :07:44.with many opting to fly overseas. Last year, air passenger traffic
:07:45. > :07:51.grew by 23% but overall, only 100 million people flew, a fraction of
:07:52. > :07:56.the 1.2 billion people in India. I am thankful for the confidence in...
:07:57. > :08:06.Low-cost airlines are rushing to expand their fleets and take
:08:07. > :08:10.advantage. Spicejet, the fourth biggest in India, is buying more
:08:11. > :08:18.Boeing aeroplanes. It helps reduce the cost of maintenance and flights
:08:19. > :08:24.and the fuel burn, because this is a far more modern aircraft. It flies
:08:25. > :08:27.off to many more destinations than we do today. That is quite a
:08:28. > :08:34.turnaround for an airline that was forced to close operations in 2014
:08:35. > :08:41.after running out of cash. Spicejet is not alone in expanding quickly.
:08:42. > :08:49.GoAir has more planes on order, and so is Indigo, with 400 plant. While
:08:50. > :08:52.that means more travellers can take to the skies, handling them on the
:08:53. > :08:58.ground remains a key challenge. -- planes. It now becomes a question of
:08:59. > :09:02.can the infrastructure keep up with that kind of growth? As Indian
:09:03. > :09:09.airlines continue to expand, that gives a boost to aviation design and
:09:10. > :09:12.many factoring and in that sector in India, since many plant products are
:09:13. > :09:19.made in India already. With the recent large aeroplane orders,
:09:20. > :09:24.India's skies are about to get more crowded. BBC News, Mumbai. Before we
:09:25. > :09:28.go, a quick look at the markets. So far, as you can see on the market
:09:29. > :09:34.boards, it is a mixed day for the stock markets. Japan is down by 76
:09:35. > :09:38.and a quarter points. A stronger yen is impacting the exports sector.
:09:39. > :09:43.There is concern about Mr Abe's meeting with Donald Trump in America
:09:44. > :09:47.and what comes out of that bilateral meeting in the White House. That is
:09:48. > :09:53.Wall Street. The NASDAQ edged up to another record. There is weakness in
:09:54. > :09:57.banking stocks pressuring the Dow Jones industrial average. And with
:09:58. > :10:04.that, we end this edition of Asia Business Report. Thank you very much
:10:05. > :10:07.for investing your time in us. I am Rico Hizon. Have a productive
:10:08. > :10:13.Thursday. That is it for now. The US Senate has confirmed
:10:14. > :10:19.President Trump's controversial choice for Attorney General,
:10:20. > :10:21.right-wing senator, Jeff Sessions. President Trump has criticised
:10:22. > :10:23.the clothing retailer, Nordstrom, for dropping his daughter
:10:24. > :10:26.Ivanka's clothing line.