June 11, 2015
BEIJING – In the last 15 years, Chinese investments in India have amounted to a mere $600 million, according to figures from the Indian ministry of commerce and industry. This, despite efforts to increase the numbers and attract Chinese businesses to boost India’s manufacturing base as well as narrow the trade deficit estimated at $45 billion in 2014-15.
June 11, 2015
BEIJING – In the last 15 years, Chinese investments in India have amounted to a mere $600 million, according to figures from the Indian ministry of commerce and industry. This, despite efforts to increase the numbers and attract Chinese businesses to boost India’s manufacturing base as well as narrow the trade deficit estimated at $45 billion in 2014-15.
Land acquisition a hurdle to Chinese investors inclined to invest in India: Le Yucheng: According Le Yucheng (in picture), following the recent visit by Narendra Modi to China, there is a concerted attempt by both sides to correct the trade imbalance. Photo: Money Sharma/AFP
According to China’s ambassador to India Le Yucheng, following the recent visit by Prime Minister Narendra Modi to China, there is a concerted attempt by both sides to correct this imbalance. However, issues such as land acquisition are proving to be a hurdle to Chinese investors inclined to invest in India. Edited excerpts:
What impediments do Chinese investors face in India?
I would say there are some impediments. Actually over the years, we have worked a lot to remove these impediments, but still Chinese business people find it’s not so efficient. In China, we do everything quickly, so efficiency in investment approval, efficiency in the environment assessment approval need to be raised. The second is security clearance, we have come to invest, not to do other things. We would like to see more facilitation in security clearance and efficiency. The third is land acquisition. Land acquisition is very difficult. If we want to invest, we want land. We need land for projects, but India has its own conditions and we understand, but we need government help. We need clearances to be expedited and also a single-window contact point. If all this is provided, we’ll have more Chinese people to invest.
You mentioned the single-window contact point. Now, Prime Minister Narendra Modi has tasked a joint secretary-level official within his office to deal with this. How far do you think this will help?
I think it will help some major projects like that of Dalian Wanda Group (who have interests in entertainment parks, malls, multiplexes). This is a major project and the coordinator in the Prime Minister’s Office will help, but for small- and medium-sized businesses and processes/projects, we need more such single contact points in various sectors, not just in the Prime Minister’s Office, but also in local government departments and ministries. We need more such people.
When Modi visited China in April, there were agreements between businesses worth above $20 billion. How many of those do you think will be realized in the near future, given that between April 2000 and April 2015, Chinese investments in India were worth only $600 million.
I think we are accelerating the pace of investment. I am sure that in the coming years, the number will increase to $5 billion or $10 billion. Some projects, like the industrial parks in Gujarat and Pune, are in full swing. These two parks, if completed, will create more than 100,000 jobs. About $20 or $30 billion will be invested, and an initial investment of several 100 millions is already in place. In Vadodara, the third stage of a power transmission industrial park is under way. In Pune’s automobile car parts (auto components) industrial park, one company got environment clearance just last month and they may get started in September.
Has land been acquired for these parks?
Not fully, but 20-30% for one factory. But we have a group of factories to be set up, and land acquisition is done for one factory. For supporting factories, we need more land. But the problem is land acquisition is hard. When local people come to know that a huge park will be set up, they just move in and live here and ask for compensation. There are several stages. In the first stage, the first factory will be set up by the end of the year, and then more factories will be set up. It will take many years to complete this.
Courtesy: LiveMint
