China should put more pressure on India to promote free trade, says state media
China “may need to adjust its speed and rhythm” to avoid overheating its outbound investment to India, state-run Global Times said.india Updated: Feb 17, 2017 19:47 IST
China should put “more pressure” on India to promote free trade as calls to boycott Chinese goods have hurt the interests of many Chinese firms, official media in China said on Friday.
China “may need to adjust its speed and rhythm” to avoid overheating its outbound investment to India, state-run Global Times said.
The opinion piece in the daily came as China’s direct investment to India in 2016 reached $1.06 billion - six times the volume the year before - and India intensified efforts to make the country an attractive investment destination by easing rules and reforming its tax structures.
India is ramping up efforts to boost domestic industries and cut reliance on imports under the Make in India initiative.
The article warned the Chinese government about boycott calls in India for China-made products. There were calls on social media to boycott Chinese products following Beijing’s opposition to a proposal at the United Nations by India to ban JeM chief Masood Azhar. The calls were triggered after Beijing obstructed India’s membership of the Nuclear Suppliers Group (NSG).
“Calls for boycotting of Chinese goods in India have hurt the interests of many Chinese companies in the country and such risks deserve serious attention. Additionally, Chinese firms have to contend with the risk that no bilateral investment treaty has been signed between the two countries - an agreement that would protect the interest of Chinese businesses,” the piece said.
The article asked the Chinese government to watch out its efforts to boost foreign investment “amid concerns that new forms of protectionism are taking root” across the world.
“Relevant countermeasures should be in place if India adopts forced localisation measures as a means to attract foreign investment, because boosting exports is as important as encouraging outbound investment for China. Beijing should put more pressure on New Delhi to promote free trade while continuing to adopt an open attitude toward overseas investment,” it said.
It claimed that the World Trade Organisation (WTO) found India’s solar Domestic Content Requirement policy was inconsistent with its treaty obligations under the global trading regime.
The piece asked Chinese investors to be “more patient” in acquainting themselves with the local market and regulations on foreign investment.
“At the least, more time is needed for some companies to adapt to the local business culture to better handle labour rights issues which are one of the most intractable challenges they face,” it said.