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China concerned at procedural delays: Meiqing
Even though Indian companies are setting up shop in China, and there is an upswing in bilateral ties between the two Asian giants, Chinese businesses have certain reservations when they invest in India. The Chinese companies are particularly concerned at long procedures for setting up subsidiaries or representative offices in India. It sometimes takes six months to one year to get a business license, which acts as a hindrance. This was stated by Mr Han Meiqing, Deputy Director, Department of International Relations, China Council for the Promotion of International Trade (CCPIT), at a session on ‘India and China: Action and Imagination’ at the 20th India Economic Summit 2004, organized by the World Economic Forum and the Confederation of Indian Industry (CII), here today.
Mr Meiqing also said that there are concerns regarding business visas and acquiring property in India. "Chinese companies have to wait for long to get business visas", and the compulsion of renewing business visas every month is also very cumbersome, he observed.
Chinese companies are also keen to buy properties in India for business purposes, he said, adding the rule barring them buying of property was an obstacle.
He said that to realize the full potential of Indo-China trade, the Indian government has to play a major role by taking steps towards reducing trade barriers on the Indian side. He further observed "China’s trade surplus is expected to rise sharply and this is likely to result in friction. And the governments must stand out to work out plans to eradicate frictions".
Mr Meiqing said that India and China were standing at the threshold of becoming economic super powers and the governments of the two countries must promote communication to understand each other better. He said that the India-China relationship need to be led by the government, even though business is the driving force. "Government should play a certain role in providing a friendly environ for mutual trade", he said.
Taking part in the discussion, Mr Michael G. Spencer, Chief Economist, Asia, Deutsche Bank, Hong Kong SAR, said that the reintroduction of these two economies in global trading existing was the most important challenge of the 20st century and the early 21st century. He observed that the integration was well handled by the Chinese while there was some reservation on India’s part.
In economic terms, this re-introduction is what is attracting businesses the world over to this part of the world, he said that every one is compelled to manufacture and outsource in India and China.
He added that the comparison between India as a software and China as a hardware and manufacturing hub was misleading and asserted that India has proven ability to manufacture in the face of heightened global competition, which is a key achievement of India. "Do not condemn Indian manufacturing. India has emerged as a manufacturing base," he observed.
Ms Elizabeth Padmore, Partner and Director, Policy and corporate Affairs, Accenture, UK, echoing Spencer’s views and observed that history was repeating itself as India and China, which both were economic super powers in the 17 and 18th century, before fading away, were again reasserting themselves in the world economy.
Padmore was of the view that it is in Beijing’s own interest to make sure that China’s rise in Asia is seen a ‘win-win’ situation. "It needs to be a sleeping dragon rather than a fire-breathing dragon," he said, adding India no longer sees China as a threat, as was the case few years ago.
Again, echoing Spencer’s views, Elizabeth observed that China will become competitive across the spectrum and not only in hardware and manufacturing, and added that it will be in India’s own interest to become more competitive in manufacturing and not only in IT.
However, she observed that this will not fuel any competition between the two as there was ample scope for cooperation, especially at the WTO forum, energy and environment.
Jalaj Dani, Vice President (International), Asian Paints, India, was of the view that India and China were poised for some exciting times ahead. He said that 1 out of 3 of the world’s customers are either from India or China and commented that this would give rise to new opportunities and imagination.
Mr Dinesh Paliwal, Chief Executive Officer, North America and Automation Technologies Worldwide, ABB, in his discussion, said that Government has a role to facilitate better ties and the Chinese government has taken certain right steps to boost trade. On the threat perception in the West, he said that it could be removed only when India and China come together in a common platform and tackle issue like tariffs and subsidies.
Rajeshwar Mishra, Group Managing Director, Orind Refractories, People’s Republic of China, also took part in the discussion.
Earlier, Mr Victor Chu, Chairman and Chief Executive Officer, First Eastern Investment Group, Hong Kong SAR, in his welcome remarks, said that both the countries are realizing the potential that exists for each other, and remarked that it is the right opportunity to do business.
New Delhi
December 7, 2004
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