India’s Prime Minister Manmohan Singh is travelling to China, as the two countries look to boost economic ties.In December, the two countries agreed to increase bilateral trade to $100bn (£66bn) by 2015, up from $60bn in 2010.Mr Singh will also attend a summit in China that will include Brazil, Russia, India, China and South Africa.China is India’s largest trading partner. However, the two countries still share a very unbalanced trade relationship.”India’s import dependence on China has gone up significantly on critical items,” said Samiran Chakraborty, regional head of research for India at Standard Chartered Bank.”Whereas if you look at exports, India’s primary export to China is only iron ore.”Mr Chakraborty says this issue could come up during the visit.
“One of the demands is to open up the Chinese markets to India. Otherwise the trade balance is very much in favour of China and working against India,” he adds.When China’s Prime Minister Wen Jiabao visited India in December, the two sides agreed to take measures to promote Indian exports in China, in an effort to reduce India’s trade deficit.About 400 business leaders came with Mr Wen to India and business deals worth $16bn were signed.The two countries also agreed to expand co-operation in infrastructure, environment, information technology, telecommunications, and investment and finance.Mr Chakraborty says it is in each sides interest to continue to deepen ties.”If these two have to stay side by side sharing borders and trying to grow at high growth rates, it has to be a complementary relationship rather then a tense relationship,” Mr Chakraborty said.”Otherwise it will impact the investment climate in both countries”. – BBC
