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'Trade will bring India, China together'
Chinese President Hu says business and trade will act as 'growth engine' for bilateral ties, reports Ravi Srinivasan.
Chinese President Hu Jintao underscored that trade and business ties will be the "growth engine" for bilateral relations between China and India, and called on the two Asian giants to boost trade and investment to levels more compatible with the sizes of their economies.
Addressing top business leaders in Mumbai on Thursday, Hu called for upping bilateral trade from the current $18 billion to $40 billion by 2010.
He unfolded a five-point roadmap to achieve this, including expanding trade and economic cooperation, strengthening focus on areas like energy, infrastructure and information technology, and joining hands to explore opportunities in other countries.
Calling for a liberalised trade environment, the Chinese president said the "basic conditions" or free trade between the two countries were already in place. The two countries have started a joint feasibility study on a regional free trade agreement. The committee is expected to submit its report by October 2007.
Nuancing the new phase of ties between China and India, Hu dubbed India a "sincere friend and partner", and called on both Chinese and Indian enterprises to achieve the bilateral trade target.
Commerce Minister Kamal Nath said that apart from trade, he was hoping that direct investment by China in India would reach at least $5 billion per year by 2010. He said China could leverage its strengths in infrastructure creation and project management by investing in India's ambitious development projects.
Responding to a specific query, Nath said that he would "welcome Chinese investment" in India's special economic zones (SEZs), which are based on China’s SEZ model.
His Chinese counterpart Bo Xilai, minister for commerce, said bilateral trade has to be taken to a "higher level", covering a wider range of goods and services.
At present, one of the major components of India’s exports to China comprises iron ore, while Chinese imports are largely manufactured goods. While China is eager to tap into India’s skills in information technology, India is eager to emulate China’s success in attracting foreign direct investment, especially in manufacturing.
While the terms "friendship" and "cooperation" cropped up repeatedly in official speeches from both sides, Indian businessmen pointed out several problem areas. FICCI president Saroj Kumar Poddar said that bilateral trade could easily hit even $75 billion by 2010, provided there was greater market access and more information on customs procedures.
Email Ravi Srinivasan: ravi.srinivasan@hindustantimes.com
