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Move over Japan, China beckons
Indians
By Indrajit Basu
KOLKATA - The Chinese presence in Indian markets
is unmistakable - everything from cheap decorative
lights to toys and numerous electric and electronic
knick-knacks that come with unbelievable price tags and
digestible quality.
But there is more to the
Chinese tale than meets the casual eye. Though imports
of Chinese goods outstrip Indian exports, according to
the Confederation of Indian Industry (CII) - one of
India's biggest industry lobbies - "China is fast
turning out to be our biggest trade partner in East
Asia". And the CII's claims will not appear tall when
one looks at the growing bilateral trade between the two
countries.
According to figures released by the
CII, during January to August 2002, India-China
bilateral trade increased by 37.5 percent over the same
period in 2001. While Chinese exports to India increased
by 40.8 percent, Indian exports to China rose by 33.7
percent. Going deeper into the numbers, Indian exports
to China totaled $1.4 billion during January-August
2002, while imports from China totaled $1.6 billion.
The CII figures also reveal something startling:
China, in fact, has overtaken Japan as a destination for
Indian exports. During April 2001 to March 2002, China
had already overtaken Japan as a source of imports into
India, when imports from China (at $1.9 billion) beat
imports from Japan (at $1.77 billion).
But the
scorching growth of exports to China, that started from
year 2002, has managed to replace Japan as India's
biggest exporting destination in Asia. Moreover, the CII
says that the numbers so far pertain to mainland China.
Adding India's bilateral trade with Hong Kong - which
stood at $2.6 billion during January to August 2002 -
the three-way trade could well take over the slot of the
second-largest trading partner of India, after the
United States. India's exports to the US during the same
period, which incidentally grew by about 18 percent
vis-a-vis China's 33.7 percent, stood at $1.3 billion.
The CII is bullish on China; so much so that it
believes China has the potential to overtake even the US
as the top exporting destination. "India and China are
the two fastest growing economies of the world. It is
possible to increase Sino-Indian trade 40 percent,"
Gurpal Singh, director, CII said adding, "CII is now
trying to enhance India-China bilateral trade to $10
billion by 2005 under a five-point agenda."
The
agenda includes holding trade shows wherein China
participates as the partner country. One such trade
show, called the International Engineering and
Technology Fair 2003, was held last week, which,
according to Singh, saw a record participation by 80
Chinese companies from the electrical machinery,
consumer products, to metal products industries.
Others on the agenda include a "Made in India
Show" in Beijing in October 2003; along with this,
another show called "India-China Hi-Tech" will be
conducted in October in collaboration with China's
Ministry of Foreign Trade and Economic Cooperation,
which will focus on information and communication
technology, biotechnology and pharmaceuticals;
strengthening of the Indian office of the CII; and
finally, the CII will start sending sectoral missions,
for instance a mission on steel, to promote that
industry in both countries.
The CII's China
fascination does not quite end there. Discussing its
role in the growth of cooperation between the two
nations, Ashok Soota, president, said that other
concurrent events would include an Indian fashion show,
an Indian food festival and a popular music show.
But it is not just Indian industry that is
focusing on the potential economic gains of increasing
bilateral trade with China. The Indian government, too,
is encouraging trade with China, hoping that such a step
will translate into better political ties. And "learn
from China," seems to be the new mantra adopted by
India's minister for disinvestments, information
technology and communications, Arun Shourie. "India has
to learn four crucial lessons from China," said Shourie
right after he took over the additional charge of
India's commerce ministry early February.
First,
to formulate policies that focus on higher growth.
"Second, we need to learn how to implement the policies
with impeccable execution; thirdly, we must learn to pay
due importance to the scale of operations; and the
fourth is to learn how to attract greater foreign
investment by facilitating the relocation of industries
from around the world in India", he said.
Fortunately for India, the feeling is mutual
from the Chinese side. "India is a very important market
for us and we have outlined major expansion plans here,"
said Linda Xia, brand manager, of a large Chinese
company, Midea.
And, according to China's
ambassador to India, Hua Junduo, the participation of 80
companies in the CII show was the country's largest
business delegation sent to any single country, which,
"reflects China's interests in building mutually
beneficial relations between the two countries".
(©2003 Asia Times Online Co, Ltd. All rights
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