India-China Sign Industrial Park Gujarat Pact on Nirmala Visit to China

The Vice President of India M. Hamid Ansari along with Commerce and Industry Minister Nirmala Sitharaman were on a five day official visit to People’s Republic of China from June 26 - 30, 2014. Ansari was in China to mark 60 years of Panchsheel or five principles. Minister Nirmala oversaw the signing of a trade pact for China Parks in India approved earlier by Prime Minister Modi and his Cabinet.

A Memorandum of Understanding on Cooperation on Industrial Parks in India between Ms. Sujatha Singh Foreign Secretary and Ms. Gao Yan, Vice Minister, Ministry of Commerce was signed for cooperation between Chinese and Indian enterprises including the development of industrial parks in India to provide a platform for cluster type development.

The Union Government has already given an in-principle approval to the signing of an MoU at, with regard to the setting up of Chinese industrial parks in India.

While five states for Chinese industrial parks namely Uttar Pradesh, Andhra Pradesh, Gujarat, Maharashtra and Karnataka have been named, Gujarat has taken the lead in this subject.

A 20-member Chinese business-cum-investor delegation has short-listed three locations near Sanand in Ahmedabad district to set up their units in an industrial park with an initial investment of $1 billion. They shortlisted three locations to set up a Chinese township and industrial park at Sachana, Dalsana and Jakhwada villages near Sanand town of Ahmedabad.

Wei Wei, China’s Ambassador to India met Gujarat Chief Minister Anandiben Patel in this context. Anandi Patel informed the Ambassador of China about the ‘Statue of Unity’, Sardar Sarovar and Dahej-Ghogha ferry service projects, the envoy showed interest in co-operating with Gujarat on these projects.

Gujarat has become a favoured destination for industrial investments after the then Gujarat Chief Minister Narendra Modi’s visit to China in 2011. Modi, now the Indian PM, is likely to meet Chinese President Xi Jinping on the sidelines of the BRICS summit in Brazil next month.

China is interested in investing in India especially in automotive, electronics, agro-processing, tourism and manufacturing and will participate in setting up of the industrial parks in the country. It has emerged as India’s biggest trading partner in the current fiscal replacing the UAE and pushing it to the third spot.

India has shown interest in setting up parks for pharma and IT sector in China.

Falling Exports to China

India-China trade has reached $49.5 billion with 8.7 per cent share in India’s total trade, US is second with 8.1 per cent share and the UAE third at $45.4 billion with 8 per cent share during the first nine months of the current fiscal of China, which commenced in September 2013. Indian Exports to China are falling, specially after restrictions on iron ore exports.