Tuesday, 23 September 2014

INDIA – CHINA : Efforts to Improve Trade Relations.


The recent visit of Chinese President Xi Jinping’s to India has removed some of the suspicions of two countries and has pushed bilateral relations to a new age. India and China agreed to work on improving the skewed trade relations and sort out the contentious border issue, which has often soured relations between the two countries.
As part of the trade balancing initiative, Chinese President Xi Jinping, during his three-day visit to India, announced that China will continue to take active steps to give more market access to products from India, including pharmaceutical and farm goods. Further, he also committed investments of $20 billion over five years.
Prime Minister Narendra Modi said that during his talks with Xi he had expressed concern over the worsening trade imbalance and sought the Chinese President’s partnership in improving market access and investment opportunities for Indian companies. According to Indian statistics, with an increase in the bilateral trade over the last decade, the trade imbalance against India also increased exponentially from $18.65 billion in 2009 to $36.86 billion in 2013.
Mr. Modi also mentioned that he was pleased with the agreement signed on two Chinese industrial parks, to be set up in India. One in Gujrat and the other in Maharashtra, at an investment of INR. 40,800 crore ($6.8 Billion). The idea of setting up industrial parks in India is to facilitate Chinese investments in the manufacturing sector as an aspect of strategic and cooperative partnership. Chinese investors from electrical, electronics, plastic and other sectors will establish their units in these industrial parks.  
The two sides exchanged 12 documents, including a five-year economic and trade development plan. An agreement on audio visual co-production, two documents on railways, another document on work plan for drug administration and a MoU on culture were exchanged between the two countries.
A MoU on peaceful use of outer space and a twinning agreement between Shanghai and Mumbai was also signed.
Prime Minister Narendra Modi said that Chinese President Xi Jinping has assured that he will take concrete steps to correct the trade imbalance and give more market access and investment in China. Modi has invited Chinese investments especially in Infrastructure.
Concrete steps on railways were also discussed between Modi and Jinping. The two leaders agreed to increase the speed on the existing rail section from Chennai to Mysore via Bangalore. China has also agreed to allow new route from Nathula to Kailash Mansarovar. This will also be usable during rains.
The Prime Minister has expressed concerns over what happened at the borders. Both of them discussed openly and touched on difficult issues, he said, adding that boundary issues will be sorted out soon.

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