Beijing: With Premier Li Keqiang promising to further open up China's huge market to Indian products to bridge the ballooning trade deficit, Tibet could emerge as the trade route between the two countries, a Chinese expert has said.
The Chinese Commerce Ministry is studying a proposal to set up new comprehensive economic cooperation zones in Tibet, to link the two biggest emerging economies and to strive to meet the India-China trade target of USD 100 billion by 2015, Wang Rui, a researcher at a Commerce Ministry think tank, said.
The biggest obstacle to improving the negotiations is the trade imbalance between the two nations, Wang, researcher at the Chinese Academy of International Trade and Economic Cooperation told state-run China Daily.
Her comments came as the trade imbalance dominated the just concluded India visit of Li who promised to open up Chinese markets for Indian products.
While Natulla in Sikkim was regarded as one important land route, Indian officials say Jelep-La, through Kalimpong in West Bengal close to the India-Bhutan-Tibet tri-junction was also regarded as yet another route that could be explored for cross-border trade.
"There are solutions to helping the two countries maintain rapid growth in bilateral trade and investment," Li was quoted by the media here as saying at a banquet at the China-India Commercial Summit.
China and India are discussing boosting an equal and fair environment to promote two-way trade and investment, he said in Mumbai yesterday.
China has great potential to add investment in India, Li said, and is committed to addressing the trade imbalance with India.
Beijing is encouraging Chinese companies to invest abroad and India has launched its 12th five-year plan (2012-16) in which it plans to largely develop its infrastructure.
China will open its market wider and work with India to jointly mitigate the bilateral trade imbalance, Li told business leaders in New Delhi earlier.
He pledged support for Chinese companies stepping up investment in India, and help for Indian products to access the Chinese market.
According to China's General Administration of Customs, China's trade surplus with India was USD 28.87 billion in 2012, up from USD 9.38 billion in 2007, which has triggered Indian trade remedy cases targeting China in recent years.
Zhang Zhiwei, Nomura Securities chief economist in China, predicted China's economic growth may drop to 7.5 percent in the second quarter from 7.7 percent in the first, dragged down by sudden falls in exports to four per cent from 18.4 percent in the first three months and with imports dropping to eight percent from 8.3 percent.
Xu Changchun, an international economics expert from the China Centre for International Economic Exchanges, a government think tank, said tightened China-India trade cooperation is expected to accelerate economic growth in both countries.
The two nations signed deals yesterday to increase Indian access to China's drug market and to promote trade in fish and meat products.
China is willing to start official negotiations on a regional trade agreement with India, and to jointly resist trade protectionism, Li said.
Feasibility studies on regional trade between the two countries were completed in October 2007.
However, official negotiations to achieve an agreement have not yet started, because of differences about specific schemes, the paper said.
First Published: Wednesday, May 22, 2013, 16:27