It was my privilege to be a part of an important business delegation to China recently. The delegation was headed by Her Excellency Smt. Pratibha Patil, President of India. Mr. Subodh Kant Sahay, Minister of Food Processing Industry also accompanied us during the visit.
I am pleased to share my experiences and observations of the visit through IIA News.
The meeting was to commemorate the 60th anniversary of diplomatic ties between the two countries. The major discussions during the meet included the rising cost of manufacturing because of recent hike in wages which is a good opportunity for Indian Business to get some components manufactured in India. But the Indian Industry still needs to fully address itself to the opportunities present in China. Another, main issue is the size of investments and the depth of engagement with China as compared to the foreign players which have put in several billions in China.
There is a need for Indian companies to revaluate their outlook towards China. The immediate goal for government of both the countries is to achieve the trade targets of $60 billion set for this year. Quantitatively, the two countries met their targets of $40 billion three years ahead of schedule and are seen to be on course to reach the $60 billion mark. However, our trade represents not just a quantitative growth in our ties but a larger broadening of contacts between our societies. For this we are going to face three major challenges:-
1. To maintain and possibly accelerate the pace of trade expansion.
2. To address issues in our current trade pattern, especially the trade imbalances which are right now in favor of China.
3. To identify the common grounds between the two economies and leverage our individual strengths to mutual advantage.
There is a lot India and China can achieve by joining hands, during the visit the Chinese leaders have given clear signals that they were keen on reducing the trade gaps by buying more from India. But to increase imports, greater awareness is required of Indian Products and services among Chinese Companies.
To achieve this, the Indian Embassy is coordinating about 20 business events in China this year, culminating in our participation at the Western China International Trade fair in Chengdu in October, 2010. Dedicated events are being held to help match making between the potential Chinese customers and Indian Providers. But Chinese businesses are yet to be convinced of the value that India can bring in order to globalizing their operations.
Another most important challenge is to remove the perception that the Indian Industry is only interested in using China as a platform to service western customers and global markets. This can only happen when Indian Businesses are successful in Chinese domestic Market and then the economic relationship will come on its own.
There is a strong possibility of a significant improvement in Bilateral Trade in the Calendar year of 2010. A larger trade and economic relationship will not only provide greater opportunity to India- China ties but also encourage greater familiarity and broader understanding between the two neighbors who have been business partners for centuries.
In view of my observations, I would advice all my dear friends at IIA to explore the business expansion opportunities in China to your advantage as there is a lot to learn and plenty of opportunities to grab.