Indian, Chinese officials hold talks to address trade deficit
Beijing: Top Indian and Chinese commerce officials held talks to take steps to reduce India's ballooning trade deficit with China and discuss follow up actions needed to broaden market access for Indian products here.
Commerce Secretary S R Rao along with Additional Secretaries Rajiv Kher and J S Deepak, who arrived here on May 27 on a five-day visit, discussed bilateral trade issues with their Chinese counterparts in the last two days, officials here told the agency.
Rao and his colleagues held talks with three top officials in the Chinese Ministry of Commerce, National Development and Reforms Commission (NDRC), the planning body of China and Ministry of Industry and Information Technology (MIIT).
They met Chen Jian, Chinese Vice Minister of Commerce and Yan Xueshan, Vice Chairman of NDRC and Vice Minister of MIIT.
The talks are ongoing, the sources said.
The talks so far went off well and were reportedly focussed on streamlining procedures for Indian exports, they said.
India also looks to facilitate Chinese offer to invest in industrial zones to step up its investments.
Issues relating to declining bilateral trade, which fell to about USD 66.7 billion last year from around USD 74 billion in 2012, China's plans to step up investments in India as well as the ballooning trade deficit which touched about USD 30 billion last year figured in the talks, officials said.
The two countries set the target of USD 100 billion in bilateral trade by 2015 during Li's visit.
During his recent visit, Li had promised to address New Delhi's concerns in this regard and seriously consider ways to meet India's demand to open up IT and pharmaceutical sectors which offered great potential for Indian products.
Li's promise to open up the sectors and the MOUs signed during his visit were expected to facilitate India's exports of oilmeal, pharmaceuticals, marine products and buffalo meat.
Indian officials expect the buffalo meat exports to fetch about one USD billion dollars in the first year itself.
Meanwhile, a Chinese scholar came up with a bizarre argument that China's trade surplus is actually helping Indian economy.
"One could easily make a case that China's long-term surplus with India is supporting the economy of its large Asian neighbour rather than hindering it", Mei Xinyu, an associate researcher with the state-run Chinese Academy of International Trade and Economic Cooperation wrote in commentary in official daily Global Times.
"In India, protectionist policies have long kept outside companies from cementing footholds in its market. Sure, this means that Indian businesses face few foreign rivals within their home turf as they slowly develop - but it also means that local companies have few incentives to improve the quality of their products", the commentary said.
"If anything, opening the door to inexpensive goods from China will inspire healthy competition and push local companies to incrementally step up their games. This will encourage upgrading within India's manufacturing sector, which will translate into higher-quality goods for both local and world markets in the long run", it said.
"We can't forget that most of the imports entering India from China are cheap raw materials rather than finished products. These goods are highly prized in India because they keep operating and manufacturing costs at acceptable levels", Mei said.