China is likely to become India's largest trading partner in a
few years overtaking the US with two-way trade hitting US$100
billion in the near future, according to a senior Indian
businessman.
Saroj Kumar Poddar, president of the Federation of Indian
Chambers of Commerce and Industry (FICCI), said at the Sino-Indian
Business Forum yesterday in Beijing that "tremendous potential"
exists in terms of bilateral trade between the world's two
fastest-growing economies.
Addressing the forum, Wan Jifei, chairman of the China Council
for the Promotion of International Trade (CCPIT), said Sino-Indian
trade totaled US$18.7 billion last year, up 37.5 percent.
If this growth is sustained, the bilateral trade could soon
overtake Indo-US trade, which is hovering around the US$30 billion
mark, Poddar added. Poddar is leading an FICCI CEO delegation in
China this week.
But Poddar stressed that it is crucial to diversify the Indian
export basket from primary products to manufactured items and
processed products in order to sustain this rate of growth.
India's exports to China are now largely restricted to primary
and resource-based products, such as iron ore exports, which
constitute more than half of India's total exports to China.
"One of my tasks for this China trip is to try to find ways to
diversify the export basket, especially by increasing the
proportion of high value-added products," Poddar told China
Daily.
This week's visit by the FICCI delegation, which is composed of
a dozen representatives from modern Indian industries, is regarded
as a crucial step for the sustainable long-term growth of
Sino-Indian trade.
Poddar said the delegation members come from a wide range of
industries, including fertilizer, energy, food processing,
petrochemicals, textile and tobacco sectors.
"We have diversified interests and are looking for opportunities
in different fields," Poddar said, adding that the delegation would
also visit Xi'an, capital of northwest China's
Shaanxi Province, and Shanghai later in the week.
Poddar said India and China, dubbed the "double engines" of
economic development in Asia, have much to benefit from a closer
relationship with each other.
"The two countries have many complementary aspects and we can
learn from each other," Poddar said. "China's development is highly
dependent on foreign trade and investment, while India relies
mainly on the growth of domestic enterprises. Each of us can draw
from the experiences of the other."
Poddar called it "very natural" for the two populous countries
to be rivals in the world's economic arena.
"Even Indian companies themselves are competing with one
another. Competition creates the best Chinese enterprises and the
best Indian enterprises."
When talking about the feasibility of reaching a free trade
agreement (FTA) between India and China, Poddar said it would
happen in the future, but the idea was still premature for now.
"We need to understand each other better before such an
agreement is reached," Poddar said. "It takes time."
(China Daily April 18, 2006)