India issues advisory as traders in China face fresh charges

The Indian Embassy in Beijing on Monday issued a second advisory warning, of the dangers of doing business in the southern Chinese trading hub of Yiwu, after two Indian traders, who have been fighting a six-month-long legal battle, were hit by fresh charges in an escalating dispute with local suppliers.

The advisory said there was “a high possibility of fresh cases being lodged in order to exert additional pressure on Indian businessmen,” who could face pressures to sign documents under duress, which “could be used against them in a court of law”.

The warning came after two new cases were filed in a Yiwu court against Deepak Raheja and Shyamsunder Agarwal, who were held hostage in the city in December, facing accusations from Chinese suppliers of owing 10 million RMB ($ 1.58 million), after the Yemeni owner of their trading firm fled, leaving dues unpaid. Chinese traders say the Indians, who were employed by the firm, are liable for the dues, and have signed documents that prove their claims.

The Indian traders argued at a court hearing last month that they were only employees of the firm, whose owners were a Yemeni and another Indian national, who remain untraceable. They said the documents were signed under duress, while they were illegally being held captive by suppliers.

An Indian official said the advisory was issued because the Embassy was “frustrated” by the local authorities' handling of the case. “We thought we were heading to a resolution after the hearings, but now the new charges have again stretched the process,” the official said.

A legal notice on the new charges was filed in Yiwu on January 20, and the summons date was fixed on May 2. The traders will again have to appear before a local court on June 27.

With no progress being made towards tracing the owners of the firm, Chinese authorities are reluctant to let the two Indians leave, with millions still owed to local businesses. The two traders, who are now staying at a hotel in Shanghai, have been under financial strain, and have relied on financial support from the Embassy and Shanghai Consulate for their daily living expenses, while they await a verdict.

The traders were, at one point, forced to spend several nights on the streets of Shanghai, and sell their jewellery when they ran out of funds.

The advisory warned that court disputes could require businessmen to stay on “for extended periods of time, hence requiring substantial funds for boarding and lodging,” in a message to the rest of the businessmen that the Indian government couldn't be expected to similarly bail them out if another such case occurred.

Mr. Raheja told The Hindu on Monday that he believed the two cases were filed by suppliers because hearings on the initial charge, held last month at a higher level court at Jinghua, appeared to boost the Indians' arguments. He said he had already given 900,000 RMB (Rs. 78.1 lakh) of his personal savings to the suppliers, after he was beaten while being held captive by them in December. He claimed the 10 million RMB dues that have been alleged hadn't been proven, and only 1.1 million RMB was owed. The suppliers and local prosecutors couldn't be reached to verify his claims.

According to the new charges, a further 400,000 RMB (Rs. 34.7 lakh) is being demanded from him, and 1.2 million RMB (Rs. 1.04 crore) from Mr. Agarwal. “We cannot pay this money,” Mr. Raheja said. “We are already out of funds, our families are in distress, and now even our lawyer is telling us to go and start begging on the streets of Shanghai.”

There is a possibility of fresh cases being lodged to exert additional pressure on Indian businessmen.

The new charges have stretched the legal process, detaining the businessmen.

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Printable version | Oct 15, 2021 11:28:27 PM |

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