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Jan. 14 - Indian Prime Minister Dr. Manmohan Singh arrived in Beijing yesterday and urged the Indian business community both in India and China to “think big” and engage China to learn to both compete and cooperate.

“Indian businesses should think big. Indian business is ready to face the brave new world of globalization. China is an important part of that brave new world of globalization. We must engage China and learn to both compete and cooperate,” Singh said.

Singh discussed with high level Indian businessmen the problems they faced in developing trade with China, including the huge surplus in commerce with India. The main thrust from the Indian side was to ask him to press Beijing for the early removal of trade and non-trade barriers, and specifically in areas such as textiles and steel. Business leaders also praised Dr. Singh on the recent trends in bilateral trade and investment flows. They also drew attention to both the opportunities as well as the challenges faced by the Indian business in China.

“The rise of China and India should be viewed as an ‘international public good’ by the global community since it offers new opportunities to sustain global growth. At a time when there are concerns about a global economic slowdown, China and India can sustain global growth through their own development, and this represents a “historical necessity” for our two great nations to work together,” said Dr. Singh. “There will be areas of competition and there will be areas of cooperation. There is enough space in the world for both countries to continue to grow and address the developmental aspirations of their peoples.”

Calling for increased economic engagement between India and China, the Indian Prime Minister�said that a large part of thinking in India about China was shaped by western views of China and that there was need for greater investment in India for a better understanding of the processes of change in India.

Striking a positive note before talks with the top Chinese leadership, the Prime Minister had said India-China relations were poised to enter a “vibrant and dynamic phase.”.

Dr. Singh said China was India’s largest neighbor and a “focal point” of its “Look East” policy. He had also made it clear that India attached “high priority” to strengthening its relations with China.

The business leaders told Dr. Singh that they had overcome fears about Chinese imports but there were still areas of concern such as very low-priced products from China which were creating problems for Indian industry.

The concerns come against the backdrop of the burgeoning trade surplus to the tune of nine billion dollars in China’s favor in bilateral trade which has touched $38.6 billion in 2007, just short of the target of $40 billion both nations had wanted to reach by 2010, meaning trade levels are running at higher than expected levels already.

CII President Sunil Bharti Mittal said the industry leaders raised the issue of certain trade-related barriers faced by sectors like pharmaceutical industry on issues like generic product registration in China. “We sought the Prime Minister’s help in this regard,” Mittal said after the 45-minute interaction with Dr. Singh and the Indian Minister of Commerce. Kamal Nath. FICCI President F Khorakiwala said the trade deficit between the two countries was significant mainly because the Chinese products were competitive creating problems for the Indian industry which should take it up as a challenge. He said while India was open in the area of media content, there were a lot of restrictions in China. “We are asking for reciprocal rights in China,” Khorakiwala said. Ranbaxy Executive Director Ramesh L Adige said the pharmaceutical industry wanted fast-track registration of generic pharma products in China conforming to international standards of 12 to 18 months as against two to three years being taken now.

Prime Minister’s Secretary TKA Nair, Foreign Secretary Shivshankar Menon and Indian Ambassador Nirupama Rao attended the discussions with the industry which was represented by CEOs including Mittal, Jet Airways Chairman Naresh Goyal, NIIT Chairman RS Pawar, Zee Chairman Subhash Chandra, Hero Honda Motors MD Pawan Munjal, Wockhart Chairman and FICCI Secretary General Amit Mitra and IL and FS CEO Hari Shankaran.

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For advice on foreign direct investment in India, please contact Dezan Shira & Associates, writers of the 2point6billion.com blog, at india@dezshira.com.

This entry was posted on Monday, January 14th, 2008 at 12:30 am and is filed under China, India, Government, Politics. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.