labels: industry - general, governance , trade, it news
The ice meltsnews
29 June 2003

Mumbai: Just the way we licked Pakistan in 1971, China licked us in 1962. And just the way Pakistan is hurting, we seem to be hurting.

There is, however, not much reason for us to be crying over what at best could be termed as spilt milk. The differences between India and Pakistan are serious and the solution could be evasive. The differences between India and China, nevertheless, are not that contentious or unsolvable.

The Indo-China problem started in 1916 when the borders between the two countries were drawn up. As it happens in all such situations there were disagreements over certain areas. These disagreements were not major as is signified by the fact that after Independence and throughout the fifties, India and China were the best of friends with Panch Sheel, the five pillars of cooperation and 'Hindi Chini Bhai Bhai' being the slogans of the day.

The border differences could have been sorted out those days but no serious efforts were made. As a result China attacked us in 1962. The reason for the attack was for a piece of land in the Northeast where, to use Nehru's words, "Not a single blade of grass grows."

Relations between the two countries have been as chill as the snows of the Himalayas since then - a missed opportunity for trade and commerce between the world's two largest populous nations.

Prime Minister A B Vajpayee's high-powered visit to China is aimed at solving the political differences as well as to take steps for improving trade and commerce between the two countries.

The border problem cannot be sorted out in one visit but meaningful dialogues have been initiated. Most importantly, at the political level, China has recognised (though not officially) that Sikkim, which joined the Indian Union in 1976, is a part of India. At the reciprocal level India has also recognised (though not officially) that Tibet is an autonomous region and a part of China.

This will lead the two countries to set up customs outposts in Tibet and Sikkim and pave the way for flow of trade through Tibet and Sikkim - the Silk Route, as it is known; the route through which trade between India and China occurred through centuries.

The items traded through these routes are traditional items like grains, clothes and other merchandise items, which will greatly benefit the people living around the 4,000-km-long border areas.

The world, however, has changed substantially in the last 50 years. This is now the age of scooters, cars, computers and telephones where both India and Chinas have made tremendous strides and can go further if they join hands and cooperate in these ventures.

It is no wonder then that in the prime ministers' delegation, as many as 41 members are representatives of these as well as other industries.

Confederation of Indian Industries president Anand Mahindra, who is a member of the delegation, is quite optimistic about the outcome. "After discussions with Chinese business leaders I have come to the conclusion that the Chinese comments on a 'synergy between China and India' now has a conviction that they seemed to lack earlier. Along with this, China is beginning to think 'China and India,' which is a big shift.

According to Mahindra, the Chinese needs are growing at a fantastic pace. "In the past two years the Chinese had enviously tried to emulate India and build competencies in the IT area. But now it is in the market for whatever is available and this is a good opportunity for Indian companies."

Given the commonality of these conditions, Mahindra says: "There is a manufacturing miracle waiting to happen in India. There is a need to remove all the roadblocks, but the one most critical factor is the need for investment in infrastructure."

Eventually it is a question of synergies, and it is there between the two countries. India has made rapid strides in IT but that is in the software area. China on the other hand is strong in computer hardware. If the two countries work together, they can be world-beaters in this field.

Realising this, companies like Tata Consultancy Services Infosys and Satyam Computers have already set up development centres in China. These have been set up in a small way now but they can grow substantially.

Similarly, in the telecom sector, China is far ahead of us in the hardware part and India can provide their telecom sector the telecom software, which we are better at.

The TVS group has already received the clearances for setting up a two-wheeler manufacturing unit in China and the Munjals of the Hero Honda fame were in the delegation scouting for prospects.

Here, it is very pertinent to note that when the TVS group had applied for permission to set up a manufacturing unit in China, the necessary formalities and clearances were over in a matter of four days and the plant was slated to be operational in eight months. Our babus who are in the delegation as well others who will be associated in the several Indo-Chinese forums on economic cooperation will have to be as nifty as their Chinese counterparts.

Vajpayee's trip is over and a lot of agreements have been signed and joint cooperative ventures have been envisaged The visit has broken the thaw and let us hope that the prime minister's slow but steady stride ends up in a long march for Indo-Chinese cooperation.

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The ice melts