Trade between India and China is booming and has surpassed
early expectations. But CNBC-TV18 reports that while
trade is friction-less, Chinese investments in India
between China and India has been smooth ever since the
thaw of 2003 and is expected to cross $20 billion, double
the target set for last year. Though the trade is hugely
in favour of China, India is taking the deficit in its
stride, and on the soaring wings of optimism has set
an ambitious target of $50 billion for 2010.
Kumar, minister of state for commerce and industry,
says, "We realise that it is our economic strength
that will give us the requisite negotiating leverage
as and when we have to negotiate. So the flavour is
on economic consolidation."
it is not just the border. Even Chinese investments
are getting quite contentious. Huawei Technonologies,
a Shenzen-based company, for instance, has been quite
a draw with the private Indian telecom equipment buyers
with its combination of quality and affordable pricing.
Sharma, deputy director, Huawei Technologies, says,
"We have got an order from Bharti, from Reliance,
etc. We are focusing more on private companies."
Sharma does not say is the government firms are quite
allergic to the company. It won a small order for MTNL
but failed to get a slice of the $6-billion GSM contract
from state-owned BSNL, through Motorola, apparently
because it failed to make the grade.
Chinese firm, ZTE, was also disqualified. And earlier
this year, Hutchison Port Holdings failed in its bid
to set up container terminals at three Indian ports
after a Cabinet bar on security grounds, though another
group company, Hutch Essar, is a large telecom player
in India. Two other Chinese companies also failed to
secure port contracts for the same reason.
Kumar says, "It is only when issues of security
are raised that the government will take a closer look
but I would say that there is no question of discriminating
on principle against investment from Chinese companies."
than a hundred Indian companies are currently operating
in China, and they are treated like any other. Indian
investment in China, currently at $130 million, exceeds
Chinese investments in India, which the Chinese put
at $47 million. China does not find India an easy place
to do business, and they wished that the government
did not make it harder still.
National Security Council regards investments from countries,
traditionally inimical to India''s interests as a security
hazard and would like them to be subject to special
scrutiny. The proposed National
Security Exception Act is supposed to enable this. The
government says the scrutiny is not country but firm
specific, but the Chinese are not convinced.