A wary India has restricted the release of a trade advisory for Indian companies doing business in China apparently to avoid another confrontation with Beijing following a series of recent run-ins including the expulsion of three Chinese journalists this month.
Trade advisories for Indian companies are usually prominently displayed on the Indian embassy website to ensure maximum publicity – the way it should be done.
But, as it turned out, not in the case of the latest advisory, which warns Indian traders to be careful of fraud Chinese companies that could supply them with sand, stones and bricks instead of goods promised when the deals were struck.
The advisory follows after several complaints from Indians doing business in China.
Despite several complaints, however, the Indian embassy decided to share the advisory only with an Indian community association in Shanghai; it wasn’t even shared with the Indian association in Beijing.
In what seems as an afterthought, the lengthy warning was put up on the Shanghai consulate website only on Friday morning.
“However, the advisory was not put on the website of the Indian missions in China to avoid misunderstanding considering the strain in ties due to differences on issues relating to listing of Pakistan-based militants and groups as terrorists by UN and Beijing's reluctance to support India's application to join the Nuclear Suppliers Group,” news agency, PTI, said in a report quoting informed sources.
It wasn’t immediately clear whether the business interests of the hundreds of Indian companies trading in China were being harmed because the important advisory – with very specific warnings – was not adequately publicised.
It is possible that many Indian companies working elsewhere in China like Guangzhou will not be aware of the advisory.
There’s a prominently displayed section “Trade Complaints” on the homepage of the Indian embassy.
At least three advisories issued to Indian traders and businessmen in 2013, 2011 and 2010 are displayed in the section with details of do’s and don’ts.
It details the procedure to register a trade complaint with the Indian embassy.
It also has the names and details of all Chinese companies involved in trade disputes with Indian companies between 2009 and 2015.
Indians in China are always advised to keep track of the embassy website to follow important announcements and notifications.
The new advisory, it seems, did not fall in that category.
When asked about the advisory, an embassy official responded: “This was sent to business bodies in India for their member companies. It is a routine advisory which we issue from time to time.”
The items to dupe Indian importers included supply of sand, stones, salt, bricks, mud in place of chemicals, Silicon Carbide, Aluminium and Zinc ingots, shellac, plastics, polymers, it said.
Other complaints included refusal to send consignments on receipt of payment, quantity dispute, stopping of communications on receipt of advance payment, dispatch of defective machinery, diversion of payment into unassociated bank accounts by third fraudulent parties by hacking into emails.
Other methods included taking money for sample dispatch and then stopping all correspondences.
Indian companies are also advised to take due precaution while engaging in business transactions, particularly when dealing with new or unfamiliar companies, it said.
It asked the Indian businessmen to follow the recommendations which included, checking of credentials of the Chinese company, including through the Embassy or the Consulates in China which may respond with basic information.
"In case of large transactions, consult a business service company which can provide a report on the business transparency, financial health, reputation, reliability and credential of the company," it said.
The advisory added: “If any Pre-Shipment Inspection is required to be carried out by any Chinese government-authorised agency and the relevant certificate needs to be submitted for clearance of the cargo at any Chinese port that must be obtained before the vessel leaves Indian port”.
Otherwise the ship may be stuck at the Chinese port and the Indian exporter may accumulate demurrage, it said.