India has called on China to facilitate “greater interaction and more openness” for Indian companies here to help address a trade imbalance between the two countries which grew to a record $ 16 billion last year in China's favour.
The Indian government has launched a year-long effort to address the trade deficit, starting with a major push to promote companies in information technology, pharmaceuticals, agro-products and engineering goods and services across 17 Chinese cities. The initiative began on Friday, with the Indian Embassy bringing together 300 of China's biggest state-owned firms, including the Bank of China, the Industrial and Commercial Bank of China (ICBC) and China Southern airlines, to drive home a simple message: Indian IT could bring value to China's domestic companies, and play a role in this country's growth story.
Indian businesses in China, in many sectors, have so far struggled to establish a presence in the domestic market, faced with competition from multinational firms that have a longer presence here, and in some instances, policies that prefer local companies. Another persisting problem, companies say, is insufficient “brand awareness” — a barrier Friday's “match-making session” sought to address.
“When we speak of our trade imbalance, China's response is ‘if you want a better balance of trade, you need to start being more active here'. That is a fair point,” Ambassador to China S. Jaishankar told The Hindu. “My view is instead of complaining about the trade deficit, we have got to start doing something about it.”
Mr. Jaishankar told a gathering of Chinese officials Indian companies required “greater interaction and more openness” in China. Addressing the imbalance in trade would only happen “if Chinese companies perceive value in working with their Indian counterparts,'' he said.
Indian companies, for their part, needed to better customise their services for Chinese consumers to have success here, executives at several IT companies who were at Friday's meet told The Hindu. “Our templates are still very western-centric, and we have largely failed to customise our processes for Chinese companies,” said Girija Pande, Chairman (Asia-Pacific) of Tata Consultancy Services. TCS is one of the few Indian companies that has had success in securing big government contracts, signing a $100 million deal with the Bank of China. Mr. Pande said ‘getting there' took the company more than seven years, and expecting Indian companies to "immediately turn things around" in China was ‘unrealistic.'
Indian companies also needed to do more to “show their value”, said Som Mittal, President of Nasscom. “Unlike Chinese companies, we have worked with the biggest global companies in different sectors, and understand different requirements very well,” he said. “We need to get this message across.”
Mr. Jaishankar said the Chinese government's response to India's IT push had been supportive so far, underlined by the presence of Vice Minister of Industry and Information Technology Lou Qinjian at Friday's meet.
In trade talks in January, Chinese officials had assured their Indian counterparts they would do more to address the trade imbalance, acknowledging it was unsustainable for the relationship in the long-term.