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      India: Commerce Secretary calls for diversification in exports to China

      Posted AtFibre2Fashion

      Commerce Secretary S N Menon has called for diversification of IndiaÂ's export basket to China to maintain growth rate in bilateral trade.

      He was delivering the keynote address at the seminar on Â'Diversification of Indian Exports to ChinaÂ' jointly organized by the Department of Commerce, Ministry of Commerce and Industry and the Federation of Indian Chambers of Commerce and Industry (FICCI).

      Â"The bilateral trade between the two countries amounted to US $ 11.3 billion in 2004-05. However this is less than 1% of ChinaÂ's global trade. It is indicative of huge opportunities available for Indian entrepreneurs for increasing their exports to ChinaÂ", he said.

      Noting that IndiaÂ's exports to China are dominated by a few primary products, Shri Menon said that diversification of export basket would address the issue of deficit in balance of trade position for India.

      Menon quoting from various studies noted that a diverse range of products such as auto engine components and automobiles, organic and inorganic products and pharmaceuticals; metal and metal based products like alloy steel bars and rods, agricultural products like grains, tobacco and oilseeds, marine foods, fresh and processed fruits, and vegetables, engineering goods like diesel engines and compressors; medical and optical diagnostic equipment and laboratory equipments, consumer durables and textile yarns have a firm demand in China.

      Menon emphasized the need for a special focus on investment and trade in services in knowledge based sectors besides traditional manufacturing sector in view of the dynamic comparative advantage of India. The Indian companies could enter the Chinese domestic markets of US$ 50 billion by using China as a production base.
      Â"The trade in service is also an important form of trade to enhance Comprehensive Bilateral Economic Cooperation. The service and knowledge trade between India and China has particularly significant potential for both in areas like biotechnology, IT, ITES, health, education, tourism and financial sectorÂ" he said.

      Observing that it was imperative for the exporters and business houses to set up branches or representative offices in China to showcase products and liaise with the provincial and the Central Governments in China, Shri Menon urged the different product exporters to take advantage of various Government schemes like Market Development Assistance to visit potential markets in China so that they were better aware of the Chinese market and product requirements.

      Â"Liaisoning with major multinational manufacturers with investment in China would help our exporters to know the import requirements and specifications for their operations in China. We need only to harness the healthy trend of growth by way of continuous interaction through exchange of delegations, enhancing participation in each otherÂ's trade fairs and seminars and encouraging our trade through positive initiativesÂ" he said.

      July 21, 2005


       

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