World Economy

China, India Sign $22b in Deals

China, India Sign $22b in DealsChina, India Sign $22b in Deals

China and India signed 26 business deals worth more than $22 billion in areas including renewable energy, ports, financing and industrial parks, an Indian embassy official said on Saturday.

Namgya C. Khampa, of the Indian Embassy in Beijing, made the remarks at the end of a three-day visit by Indian Prime Minister Narendra Modi, during which he sought to boost economic ties and quell anxiety over a border dispute between the neighbors, Reuters reported.

"The agreements have a bilateral commercial engagement in sectors like renewable energy, industrial parks, power, steel, logistics finance and media and entertainment," Khampa said.

At the same event, Modi encouraged Chinese companies to embrace opportunities in India in manufacturing, processing and infrastructure, announcing "now India is ready for business" with an improved regulatory environment.

India and China have agreed to work on long-standing border conflicts and trade imbalance disputes to bolster bilateral ties. Modi said that Beijing needed to "reconsider" its approach.

India is looking for a new direction to improve relations with China, he told reporters on Friday after meeting his Chinese counterpart, Li Keqiang, in Beijing.

"Our conversations were candid, constructive and friendly. We covered all issues ... I asked China to reconsider its approach on some of the issues that hold us back on realizing the full potential of our partnership," Modi said.

'Make in India' Initiative

On his final leg of his visit to China, Modi met the top business tycoons of China and pitched the 'Make in India' initiative to them, India Today reported.

Speaking to 22 top Chinese businessmen, Modi said "You are the 'factory of the world'. Whereas, we are the 'Back office of the world'. You give thrust on production of hardware, while India focuses on software and services".

And in a bid to assure the top CEOs of the ease of doing business in India, Modi informed them about the steps being taken to make the taxation system transparent, stable and predictable.

He also emphasized on his government's effort to not resort to retrospective taxation, probably keeping in mind the possible queries that have come from the CEOs about the recent tax issues foreign investors have faced in the country.

Modi also devised a '5F Formula' for the Chinese businessmen in the process of inviting them to 'Make in India': 'from farm to fiber to fabric to fashion to foreign'.

Positive Response

The Chinese CEOs have responded positively with a number of firms pledging their 'full support' to the 'Make in India' initiative.

Speaking to Modi, Alibaba's founder Jack Ma said, "We are excited about India. We are excited about Make in India and Digital India." while Lin Bin, President of mobile handset maker Xiaomi said, "We have some big plans for India, We fully support Make in India."

Indian CEOs who are part of the business delegation that have gone to China with the PM have welcomed the push given to trade relations. Infosys CEO, Vishal Sikka said that India and China working together would create a large pool of opportunities.

Modi also visited the Fudan University in Shanghai and spoke to students briefly. He said: 2016 is the year of China coming to India. Just like 2015 was the year of India visiting China. "The world is watching as India and China together are standing up to give a new hope to the world. Times have changed. China and India together hold the potential to help the world with the problems it faces."