CHINESE PRODUCTS IN INDIAN MARKET
India and China look for ways to enhance business cooperation
India and China, two of the world's fastest growing economies, have started looking at more opportunities in the business sector. As work continues on ironing out diplomatic issues, both nations recently inked a much-awaited agreement at resolving the long-running dispute over their Himalayan border.
Now, augmenting bilateral trade between the two nations has become an area of focus.
From $13.6 billion in 2004, bilateral trade between India and China has increased in the current year, and both nations have targeted trade worth $20 billion by 2008. In fact, over the past eight years, two-way trade has been growing at 30 percent a year and current estimates predict that by 2010, the figure could easily surpass $30 billion. At that level, China could well emerge as India's largest trading partner, overtaking the US.
For a nation that was concerned about the Chinese imports a few years ago, India today has a positive balance of trade with China. Figures for 2004 put India's exports to China at $7,677.43 million compared to imports from China at $5,926.67 million. The industry views this as extremely encouraging but there are concerns.
Experts feel the time is yet not ripe for India to give free access to China into its domestic markets for all kinds of products.
However, the trend reverses in case of the auto component industry. Imports from China are being viewed as the next big challenge for component manufacturers here. According to figures available from Automotive Component Manufacturer's Association (ACMA), in 2002-03, India's export to China was worth Rs 69.34 crore while import was a little over Rs 47 crore. The following year, India's exports to China fell in comparison to its imports from China.
By the close of the current fiscal, the import-export disparity is expected to widen further. While India could end with exports worth Rs 80 crore,...