Bilateral trade crossed $65 billion in 2013 and $72 billion in 2014-15. Chinese imports have grown sharply relative to Indian exports resulting in a record deficit of $35 billion in 2013. Latest figures released by the Department of Commerce, India, reveal that trade deficit has expanded to $48 billion in 2014-15, more than four times India’s total exports to China.
The report recommends a 4 point action plan:
uLeverage India’s importance as a market for Chinese products as well as an investment destination for Chinese companies
uPush for market access in key sectors of China – Pharma, IT, Tourism, Media and Entertainment, Auto Components and others
uPrioritise Chinese FDI in 18 identified industry sectors and establish a sovereign deal to attract investment in Indian infrastructure
uSet up an institutional committee of Govt and industry led by the PM’s Office or Department of Commerce to direct and monitor the achievement of goals
To promote exports and investments:
uIndia will need to push for specific actions in certain identified sectors like IT Services, Pharma, Auto Components, Tourism and Entertainment
uAcross these targeted sectors, India has a potential to generate revenues in excess of US $10 billion in 4-5 years ie nearly 80% of the exports of India to China in 2013
uIndian companies need to change their mindset towards China and invest for the long term by committing resources in terms of technology, capital and senior management and work in close co-ordination with the Indian Govt, which has a critical role in enabling market access in China.
