New Delhi: India has conveyed to China that the trade imbalance of around 36 billion USD is "not sustainable", prompting the two sides to decide on an expert-level meeting to address the issue.
Vice President Hamid Ansari, who returned home last night after a five-day visit to China, underlined that ties with that country is an "important" priority of the new Indian government.
"I had a long discussion...The minister (Commerce Minister Nirmala Sitharaman) had separate discussions. We said the trade has increased but the imbalance exists which is not sustainable (is tarah se gaadi nahin chal sakti hai)," he said.
The bilateral trade declined from around USD 75 billion in 2011 to USD 65.45 billion last year amid continuing decline of Indian exports. The trade imbalance currently stands at around 36.5 billion, which is worrying the Indian side.
The imbalance is mainly because of strong regulatory systems in China that discourage India exports in sectors like the strong areas of IT and pharma.
The two countries had set the target of USD 100 billion by next year, which officials say is an uphill task.
The Vice President said there were two ways to improve the imbalance. One is that India increases its exports to China and the other is that China increases its investment in India.
"Their response was okay. There are some issues they want to study...It is a complicated, technical subject," he said while interacting with journalists while returning home.
"Talks will be held at the expert level," he said.
Replying to a question on reported difficulties for foreign companies to set up businesses in India, Ansari said Finance Minister Arun Jaitley and others have made statements in this regard and there are proposals to simplify FDI procedure.
He said the General Budget will spell out more details.
The Vice President said the Chinese leadership is keen to establish "personal-level contacts with the new leadership in India.
"It was mentioned to me by President (Xi Jinping) that he is looking forward to meeting with Prime Minister Narendra Modi on the sidelines of the BRICS summit" to be held in Brazil later this month, Ansari said.
During the visit, India and China signed an MoU on industrial parks with an aim of attracting Chinese investments in India and providing an enabling framework for Chinese companies to invest in Industrial parks and zones.
Under the MoU, the two countries have agreed to cooperate to increase mutual investment in each other's economies and this cooperation will be in accordance with the relevant domestic laws and regulations of each party and on the basis of equality and mutual benefit.
An Industrial Park Cooperation Working Group made up of equal number of representatives from both the countries will be set up to identify and agree upon the detailed modalities for implementing cooperation under this agreement and will periodically review the progress.
First Published: Tuesday, July 1, 2014, 17:59