At a time when everybody’s tilting their champagne glasses, toasting the rise of the Asian century, its sometimes time to get a reality check too. We all say, think & feel that India and China have more to gain by working together, yet security concerns keep the two countries from co-operating in trade.

Sify, recently announced that New Delhi is dragging their feet on granting permission to Liaohe Petroleum Exploration Bureau (LPEB), a Chinese seismic survey firm of the country’s hydrocarbons exploration and production giant CNPC, who wants to open offices in Kolkata and Chennai.

“Most of the state-owned Chinese companies have links with China’s intelligence services. We cannot jeopardise our country’s strategic and security interests,” a senior official in the home ministry told sify on the condition of anonymity.

“Since Chinese companies are now bidding for port projects in our neighbourhood, there is a chance that Liaohe Petroleum could misuse its office and give crucial oceanographic data of Indian waters to their navy,” the official added.

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Who knew that in 1991 ( economic policy), India would come this far and welcome investors with open arms. In the last few years the Nation has changed its policies towards a fruitful object and continues to do so.

I can recall when I was studying economic and business legislations of India that we used to talk about whether the FDI limits would eventually change to bring in more money and a better infrastructure or would Indians be driving on those bumpy roads and suffer in jams with its overgrowing population due to lack of adequate flyovers; will there be enough place at its airports to accommodate the immense increase in air traffic to India or for that matter will there be airlines other than Air India/Indian Airlines/a few more. Today the picture as changed and seems like we have the right people on board to gauge the needs of the hour.

Yesterday, 30th January 2008, the Government of India (GOI) showed how liberal it’s getting in its policies. The Cabinet Committee on Economic Affairs (CCEA) announced the following increases in the FDI limits in 7 sectors. Lets have a look below :

Sector/activity                                                           New Limit (max)        Old Lmit

oil refinery joint ventures with public-sector              49                                      26
oil firms  (1)

ventures involving the trading and marketing of        Deleted a rule
petroleum products. (2)

maintenance, repair and overhaul organisations        100                                   49
(MROs) and flying training institutes, helicopter
and sea-plane services

cargo and non-schedule airlines                                   74

ground handling services
(after requisite security clearances are obtained)`       74

Indian commodity exchanges     (3)                              49

mining and mineral separation of titanium
-bearing minerals and ores (4)                                      100

Credit information companies (5)                                 49

listed credit information companies                              24

Industrial Parks (6)                                                waviers (more…)

After an excellent response from many on the last issue on: Setting up Foreign Enterprises in India, we now bring to you an overview of the investment environment in Delhi and Mumbai. I’m sure a lot if you know both cities well, but we dig into the demographics and give you the rundown on the investment environment in these two emerging metropolis’s

Delhi, a city where I grew up in, is very warm and welcoming to everyone. From school to University to work, I have seen it changing into a real cosmopolitan city. It can be compared in many ways to Beijing also as the political head of the nation.

Mumbai rocks! I have spent a few years there to and that time is unforgettable. The city gets to you in many ways, it’s unique culture facing both east and west, and as the financial capital of India it now boasts some of the most expensive real estate in the world. We lift the lid off what is going on and give you a peek at why Mumbai is a city you should be considering having a good look at. It too compares in many ways with Shanghai.

Finally we look at the USD100 billion planned Delhi-Mumbai Corridor, tax incentives, and free trade zones. As India opens up, this is a neat introduction to two of it’s primary cities. We hope you enjoy it – subscription is complimentary and available on the India Briefing homepage

Chris Devonshire-Ellis, Senior Partner of Dezan Shira & Associates Beijing, and publisher of China Briefing magazine, has just completed his annual series of meetings with Chinese Government Ministers and is available for private meetings on matters of China business law, tax and investment policies from Monday, May 7th - Friday, May 11th in Bombay, and from Monday, May 14th to Wednesday May 17th in Delhi.

Chris has lived in China the past 20 years, while his business advisory and tax practice is retained by over 1,600 multinational clients with investments amounting to over USD25 billion in the PRC. He is one of China’s best known international consultants, and has also published the renowned “China Briefing” series of magazines and books for the past seven years.

Dezan Shira & Associates: http://www.dezshira.com/

China Briefing: http://www.china-briefing.com/

If you wish to meet with Chris to discuss matters of China business, or to explore potential collaborations, please email him directly at chris@dezshira.com to make an appointment. Meetings are on a confidential basis and will not be charged for.

Introduction to two presentations on the success and failure of businesses and associations in India:

India is currently the 10th largest economy, fourth in terms of purchasing power. Growth for this year alone is over 8%. The current, estimated GDP is around $719.8 Billion. Since becoming an open economy in 1991, India has worked to make its mark in the global market. The average age of its citizens is 27 years old and many of whom are well educated, married and without children; India has the ability and resources to be among the top four nations in terms of economy. The presentations include lessons to follow when establishing business operations in India: http://www.2point6billion.com/Succeeding_in_India.ppt and an overview of the climate for setting up a business in India: http://www.2point6billion.com/India_presentation.ppt.

This presentation was given by Ajay Muttreja, Plexus Consulting Group Affiliate in India and CEO, Director of Tecnova India. 

We are grateful to Plexus Consulting for allowing us to post this powerpoint presentation. Please visit them at www.plexusconsulting.com