NEW DELHI: With India’s trade deficit with China in danger of steadily expanding, newly minted Commerce and Industries minister Suresh Prabhu said on Saturday that the two countries have agreed to set up industry specific working groups which will help increasing Indian exports.
“Concerned about growing trade deficit with China, we agreed to set up industry specific working groups, to promote more exports from India,” Prabhu tweeted from the capital city of Philippines – Manila – where he is attending the fifth East Asia Summit (EAS) Economic Ministers’ Meeting. He is also set to participate in the trade ministers’ meeting of 16 Regional Comprehensive Economic Partnership (RCEP) member countries on Sunday.
While seeking to reduce the trade gap, Prabhu has also sent out a call for Chinese businessmen to begin investing in India, offering facilitation of investments in special economic zones. The issue of the widening trade gap between India and its neighbour has been at the centre of the commerce ministry for a while now. In 2014, Prabhu’s predecessor Nirmala Sitharaman had informed the Rajya Sabha that this deficit can be reduced to sustainable levels through more exports… as well as by China’s investing in building manufacturing capacities in India.”
In contrast to the trade gap, with stood at $51.08 billion in fiscal year 2016-17, Chinese investment has not grown as fast. Chinese Foreign Direct Investment (FDI) in India between April 2000 and June 2017 stood at a miniscule $1.67 billion – only 0.49 per cent of total FDI inflows of $342 billion during that period.
The disparity has led India to press for more investment from China, even as it desires greater market access to the Chinese market in sectors like Information Technology and pharmaceuticals.
The announcement of the creation of working groups came after Prabhu and his Chinese counterpart Zhong Shan met on the sidelines of the summit to discuss ways to promote bilateral trade between the countries. The Indian minister also met Japanese minister of economy, trade and industry Hiroshige Seko, Korean trade minister Hyun Chong KIM and Australian minister for trade, tourism, investment Steven Ciobo.
Source: http://www.newindianexpress.com/business/2017/sep/10/india-china-to-set-up-joint-working-groups-to-bridge-trade-deficit-1654795.html