The story appears on

Page B7

August 15, 2011

GET this page in PDF

Free for subscribers

View shopping cart

Related News

Home » Feature

Why China is the ideal partner

E. B. Rajesh, chief representative of the Confederation of Indian Industry in China, is glad that he chose to come to China against his initial concerns about language, food, culture and various others factors.

"India and China are the fastest-moving emerging markets, I am involved in both of them, isn't that wonderful?" Rajesh said with a big smile.

The Confederation of Indian Industry is a non-government, not-for-profit, industry-led and industry-managed organization that works to create and sustain an environment conducive to the growth of industry in India. With a 116-year history, the confederation is India's premier business association which has more than 8,100 direct company members, and an indirect membership of more than 90,000 in both manufacturing and service sectors.

Established in 2003, the confederation's Shanghai office is the only Indian business association present in China so far. It is because among the 200-plus Indian companies investing in China, almost 60 percent are located in the eastern areas with Shanghai poised center stage. With the expanding bilateral business communications, the demand for greater presence of the confederation has emerged.

"Although we have no concrete plan right now to launch more offices, it seems we need to take it into consideration," Rajesh said.

During the past eight years, emphasis of the confederation's job in China has changed rapidly. In the early days, what it did most was to organize seminars and meetings to introduce China to Indian investors and tell them the possible opportunities. Today, there is less need for such inculcation. The most important part of Rajesh's job now is to help Indian companies settle in China with his knowledge about the proper procedure and help them overcome the initial difficulties. CII also helps the Chinese companies interested to do business with India in linking to the relevant Indian partners.

Many big Indian firms have taken root in China. State Bank of India, the largest Indian bank, upgraded its representative office in Shanghai to a full-fledged branch in 2006 and became the first Indian bank to start commercial operations in China. Infosys, a global leader in information technology, has made huge investment in Shanghai. Sterlite Technologies, a leading global provider of transmission solutions for the power and telecom industries, aims to "connect every home on the planet," and companies such as Wipro and TCS have all carried out new expansion plans in China.

Last year, Indian President Pratibha Patil had a five-day official visit to China. The trip coincided with the 60th anniversary of the establishment of diplomatic relations between the two countries.

Wan Guanghua, an economist at the Asian Development Bank, said at a Shanghai forum hosted by Fudan University in May that the India-China relationship will become the most important bilateral relationship in the near future. It is because the combined population of the two countries amounts to one-third of the world's total, he said. Wan's judgment is arguable, but no doubt a good relationship is important to both countries, and to the world as well.

After the two ancient civilizations returned to the growth track and were dubbed as the two most promising among the BRICS (Brazil, Russia, India, China and South Africa) nations, a closer cooperation in business may accelerate that growth process and benefit both countries. As emerging markets, they share a lot of interests in common.

Shanghai Daily: India and China are among the most reported emerging markets in recent years. Many media reports love to compare these two countries and make them look like rivals. What's your opinion about the business relationship between India and China?

Rajesh: If you ask me whether we are competitors or partners, I would say we are both. In some areas, cooperation is the mainstream. In some others, there is competition. And in most cases, cooperation and competition interact.

The most obvious area for partnership is the infrastructure. China can help India a lot in building roads, railways, harbors and airports. And in information technology and software where India can contribute, China is able to get added value through cooperation.

For being competitors, I want to say it is not a bad thing, as long as it is healthy competition that provides equal opportunities and can get the best out of both countries.

For example, India and China are growing markets that need a lot of natural resources, be it iron ore, cotton, oil or gas. We both go to Africa and other places for sourcing. Competition in such an area encourages us to think more on how to create new ways to minimize the usage of natural resources or to reduce energy consumption. That's why green technology is growing fast in both countries.

Sometimes, cooperation and competition are interwoven, just taking place in different parts of the same value chain. As big producers of agricultural products, both India and China are competing in the food processing industry. However, China still needs to import some food from India to complement its stockpile. And India requires a better infrastructure and better cold storage system that China can help with, to extend the shelf life of its products.

Shanghai Daily: Can you introduce briefly the role of the Confederation of Indian Industry?

Rajesh: As the premier business organization, we mainly represent Indian industries and get their views to the government for taking necessary policy decisions. In India, our membership covers major companies from different sectors which contribute a lot to India's economic output.

In China, we established our Shanghai office in 2003 when real Indian investment took place. India and China are long-time trade partners, but there was limited investment here a decade ago. In 2001, China joined the World Trade Organization and we felt it necessary to have a forward-looking and long-term engagement with China. We help guide and promote Indian businesses in China and get investment, and vice versa.

Just last month, we held seminars in four Indian cities, with the presence of some Chinese officials, to give an updated picture of China among the Indian businesses. We also established the India Business Forum in April 2009. It is a platform to raise awareness among Chinese firms about the capabilities and value offered by Indian companies, discussing and addressing challenges faced by Indian companies in China.

Shanghai Daily: What about Indian businesses' sentiment over investing in China at the moment?

Rajesh: Although China's economy has shown signs of moderation, I think it's a temporary dip because basics in China are quite solid. Also, we have to separate industries. In areas like information technology and software where India has strength, the growth momentum is less disturbed by the slowing economy.

Besides, you have to consider what destinations your investment can go to outside of China. The United States? Europe? Possibly not. Other markets like Latin America and Africa are just in a nascent stage compared with China. Thus the answer is quite clear.

Shanghai Daily: China has become increasingly a source of outbound foreign investment. Are there any potential areas in India that may attract Chinese investors?

Rajesh: Yes. As I mentioned earlier, China is very experienced in infrastructure, and it can help India build up roads, railways, harbors and airports that India urgently needs.

China has been focusing more on trade than investment. Bilateral trade between India and China amounted to nearly US$62 billion last year, with China exporting US$41 billion to India and importing US$21 billion. You can see a huge trade surplus here. In the past couple of years, Chinese investment in India has started to grow.


Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.

沪公网安备 31010602000204号

Email this to your friend