Imbalanced trade not in India, China's interest: V K Singh

Imbalanced trade not in India, China's interest: V K Singh

India today said "imbalanced" trade with China leading to a yawning USD 47 billion trade deficit needs to be "pro-actively" addressed through improved market access for Indian products with competitive advantage like those in IT and agro.

"Such imbalanced trade is not in the long-term interest of either country. Both governments are committed to taking imaginative measures and rigorous effort in tackling this issue," Minister of State for External Affairs Gen (Retd) V K Singh said at the India-China Economic and Tourism Cooperation Forum.

"The deficit requires to be pro-actively addressed," he said at the forum, being held on the sidelines of China South Asia Fair in southwest China's Kunming city in Yunnan province.

Answer to the mounting trade deficit lies in improved market access for Indian products with competitive advantages such as IT products and services, pharmaceuticals, agro- products, and value-added textiles, he added.

However, he noted that the bilateral trade has not grown in a balanced way.
"While bilateral trade has grown, it is not balanced. Both sides have recognised the challenge posed by the growing trade imbalance and its negative effect on sustainability and diversification of bilateral trade," he said.

Singh said "last year, trade deficit climbed even more to cross USD 47 billion" of the total USD 70.59 billion trade, which officials say accounted for one-third of India's total trade deficit.

West Bengal's Finance Minister Amit Mitra and India's Ambassador to China Ashok K Kantha along with top Chinese officials took part in the meeting.

India is the country of honour at the annual five-day South Asia Expo this year. Many Indian businessmen have opened their stalls at a colourful pavilion built by the Indian Embassy here.

Stating that "bilateral investment can emerge as driver of our economic Sino-Indian economic partnership", Singh said he welcomes Chinese companies to partner in India's economic growth and development.

Singh said the 'Make in India' campaign provides Chinese firms the "golden opportunity" to build awareness of China's contribution to India's development.

"The Make in India campaign provides a golden opportunity for Chinese companies. The size of our market and its current stage of development make India a natural destination for Chinese companies.

"'Invested by China, Made in India' should be encouraged. The industrial parks in Gujarat and Maharashtra are important bilateral endeavours," he said pointing out two parks devoted for Chinese investors.

"I look forward to their speedy establishment. We are also open to promoting additional industrial parks and investment projects from China. The role of the States and Provinces in pushing economic cooperation and taking forward this agenda will be crucial.
"I welcome Yunnan to play a leading role," he said.

Singh also suggested that India and China should jointly push accelerated cooperation in infrastructure and briefly referred to the Bangladesh, China, India, Myanmar, (BCIM) Economic Corridor, which is part of China's Silk Road plan.

Accelerated cooperation in infrastructure, railway, industrial corridors and smart cities in sync with the thinking on the BCIM corridor will take these ideas forward.
India is backing only the BCIM among the Silk Road projects and remains silent on China's Maritime Silk Road.

"Railways, industrial corridors and smart cities can yield flagship projects that will symbolise the potential for India and China's economic partnership. The partnership in the Asia Infrastructure Investment Bank (AIIB) framework also needs to be harnessed towards this end," he said.

Singh added that investment can improve average Indian people's awareness about China.

"While China is active in project execution in India, the average Indian has limited awareness of China's contribution to our development process.

"Our cooperation in flagship infrastructure projects will help build that awareness. The modernisation of railways is a key priority of my government and we see China as a partner in this process," he said.

The sustained attention to strengthening railways cooperation is now showing results in the areas of speed raising of existing tracks, heavy haulage training, high-speed rail, station development and establishment of railway universities, Singh said.

About India's plans to create 100 smart cities, he said China also has a big smart city initiative and the two sides "should come together to combine our know-how and best practices".

"The recent successful visit of Prime Minister Modi to China has helped in pushing forward this common agenda. Shenzhen in China and GIFT City in Gujarat will be the first pair of smart cities for bilateral demonstration projects," he said.

He also called on Chinese tourists to take advantage of the e-visa facility announced by Modi to visit India.

Without doubt a transformative enhancement of tourism linkages should be an important element, he said.

"It is clear that the present bilateral tourist flows do not capture the immense potential for mutual travel and the interest that is latent in India as a travel destination. We hope that the stepped up focus through the celebration of Visit India Year in 2015 will help in better appreciating what India has to offer," Singh said.

"With more than 100 million overseas trips taken during last year, China has emerged as the leading source market for tourism in the world. India, however, receives a very small share of China's outbound market.

"Tourist arrivals from China amounted to only around 180,000 in 2013. India would like to tap the vast potential of this market and to increase its share in the outbound travel from China," he said.

"Even more than the economic imperative, tourism cooperation is a potential game changer in bringing both of us closer and in enhancing mutual understanding and trust," he said.

Singh said the e-visa facility is a huge positive signal for greater tourism exchanges.
"I encourage our friends in China to take advantage of this facility, particularly those in Yunnan that enjoys even closer geographic proximity to India than Beijing," he said.

Stating that India is emerging as one of the largest economies in the world and one of the fastest growing emerging markets with an average annual growth rate of more than seven per cent over the past decade, he said there are encouraging trends that suggest that India may be heading towards even more accelerated growth.

Development of a robust manufacturing sector is a priority of the government given its potential to speed up economic growth and create employment, he said.

"The government is committed to removing all bottlenecks to develop India as a manufacturing hub. This includes further liberalisation in the foreign investment regime, relaxation of labour laws, initiatives to augment domestic infrastructure and capacity," he said.

Simplification of the procedures and rationalisation of the existing rules and increased use of information technology to make governance more efficient, effective, and user- friendly were also included, he said.

"The development of infrastructure corridors and industrial clusters is being advanced through a series of initiatives. The 'Make in India' initiative launched in September last year promotes manufacturing in 25 key sectors. The Digital India Campaign promotes services and IT-based industries and e-governance," he said.

Indian Ambassador to China Ashok K Kantha in his speech said Chinese President Xi Jinping's trip to India last year and Modi's visit here last month have opened up a new chapter in India-China ties.

"India's participation as Theme Country at the 3rd China-South Asia Expo and Yunnan's active role in developing economic and other people-to-people engagement is a reflection of this emerging trend. We welcome it," he said.

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