Chinese companies making mark in Indian markets

Last Updated : 17 January 2011, 10:10 IST
Last Updated : 17 January 2011, 10:10 IST

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While the market share for Chinese acquired Lenovo computers, has gained nine per cent share in the Indian market against stiff competition from HP, Dell and Acer, Chinese telecom equipment maker Huawei and ZTE made big inroad into Indian market, it said.
Lenovo, the Chinese company, which took over IBM's personal computer (PC) arm in 2005, now has a bold plan to surpass all its competitors to become the largest player in India by 2014.

"If we can be a strong No 1 in China and, giving the similarity between the two countries (China and India), why can't we be the No 1 in India?," the Managing Director of Lenovo India R K Amar Babu told China Daily in Bangalore.

He said because India is "a little behind China" in terms of economic development, market penetration and maturity, many of Lenovo's successful experiences can be applied to India.

As part of its global strategy to steer away from relying on advanced markets such as the US to fuel overseas growth, Lenovo started focusing its expansion on emerging markets.
It started investing in India and Russia after its business in the mature markets was hit hard by the global financial crisis in 2008.

Although India is the world's ninth biggest PC market, Babu said the country has a huge potential for growth due to its vast population, growing numbers of young people and relatively low PC penetration.

"By being manufactured in China, our product can be 25 per cent cheaper than our rivals. We expected our business to grow at the rate of 30 per cent annually and become one of the top two players in India in the next three years," D K Ghosh, chairman of ZTE Telecom India said.

According to research firm Analysys Mason, ZTE is the fourth biggest player in the India telecom equipment market, following Ericsson, Huawei and Nokia Siemens Networks.
Last month, the Chinese government approved ZTE's plan to increase investment in India.

Ghosh said he expects ZTE's business will be USD 1.7 billion last year, an increase of about 70 per cent compared with 2008.

China and India have built up their own positions of strength in the world economy since instituting economic reforms adopting different models, the daily said.

"The economic structures of China and India are in fact more complementary than competitive," said Peng Gang, commercial counsellor of the Chinese embassy in India.
China has emerged as India's largest trading partner.

Last year, bilateral trade was expected to reach USD 60 billion, up from USD 42 billion the previous year and a 30- fold increase since 2000.

On the back of that trend, especially after the financial crisis during which the United States and European countries struggled with the economic downturn, more and more Chinese have chosen to turn their eyes to their emerging neighbour.

Despite the increasing economic ties between China and India, the political relationship between two of Asia's biggest countries was still "very fragile, very easy to be damaged and very difficult to repair,"  Chinese ambassador to India Zhang Yan said.

Issues such as territorial disputes and employment visas often disrupt normal communication between the two countries.

For businessmen such as Ghosh from ZTE, the best solution to solve that problem may be commercial cooperation.

"India and China are not enemies. Our relationship should not be India versus China but India and China...If India and China work as one, we can create an economic tsunami in the world", said Ghosh.

Published 17 January 2011, 10:10 IST

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