continuously updated blog about China & India
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Beware the Waking Dragon
Chinese President Xi Jinping (R) holds talks with visiting Colombian President Ivan Duque Marquez at the Great Hall of the People in Beijing, capital of China, July 31, 2019. (Xinhua/Li Xueren)
BEIJING, July 31 (Xinhua) — Chinese President Xi Jinping and visiting Colombian President Ivan Duque Marquez on Wednesday pledged to promote bilateral relations to a new high.
Source: Xinhua
look set for another informal summit in October, and a key item on the agenda will be
.
, who have been looking to emulate their United States counterparts such as Tiger Global and Sequoia Capital that dominate the sector.
’s affordable labour market and strong economic growth provide a healthy breeding ground for young tech outfits.
have been injecting funds into a variety of cash-hungry Indian businesses.
Beneficiaries have included advertising firm Media.net, e-commerce operator Snapdeal, digital payment provider Paytm, online travel firm MakeMyTrip, messaging platform Hike, health tech start-up Practo and news aggregator Dailyhunt.
, the knowledge and technology of Chinese investors act as the backbone of their business, along with the operational expertise of Indians in the domestic market,” said Ntasha B, co-founder of Venture Gurukool, a mentoring platform for start-ups which works closely with Indian diplomatic missions in China.
She added that Chinese investors usually had a hands-on approach and were a bit inflexible, unlike their American counterparts, who gave some elbow room in hiring local teams.
A senior executive with an Indian start-up, who did not wish to be identified, said it was sometimes straightforward to convince Chinese investors as they could relate to Indian business models and requirements that were dissimilar to those from the Western world.
The world’s second-largest economy invested nearly US$2.5 billion in Indian start-ups last year, a figure that has touched almost US$1 billion so far this year, according to finance research firm Venture Intelligence. The number of such deals jumped from just one in 2013 to 27 last year.
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Indian start-ups are estimated to have raised US$3.9 billion from around the globe in the first six months of this year, and the inflow from Chinese behemoths played a key role in pushing them to turn east to source funding.
“What’s more interesting about [Chinese investors’] strategy is that they’re paying more attention to rural India. If you look at the companies they’ve invested in, a fair amount of their businesses target the rural segment,” said Sandeep Murthy, managing partner at venture capital firm Lightbox Ventures, which keeps a close watch on Chinese investments. He said the brisk economic activities in India’s tier two and tier three towns are more attractive to Chinese investors than India’s urban centres.
WHY INDIA?
For Ctrip – China’s largest online travel agency, which in April took a 49 per cent stake in MakeMyTrip – the appeal of India was its whirlwind technological advancement and the disposable income of its massive young population.
“[MakeMyTrip has] achieved fast growth in the online travel market and is becoming well recognised in the Indian market. Their comprehensive products and services, management team and the opportunities in India result in our confidence that they will continue to succeed,” said Wei Yuan Min, a member of Ctrip’s global team. Behind the US and China, India houses the world’s third-largest start-up ecosystem in terms of the number of companies. As for the number of unicorns – start-ups valued at over US$1 billion – India ranks third, offering a vibrant habitat for entrepreneurial ventures. The country is home to 32 such firms, with the addition of nearly half a dozen so far this year and 15 last year.
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New Delhi expects there to be 12,000 tech start-ups in the country by next year, up from 7,200 last year. There were 1,200 new tech firms in the sector last year, according to industry body Nasscom.
One of those capitalising on this opportunity is the Beijing-headquartered technology company Xiaomi, which last year promised to pump US$1 billion into 100 Indian start-ups over the next five years. Most of these Indian firms are involved in businesses that are ancillary to Xiaomi’s key operations.
“These start-ups help us in building a stronger product offering,” a Xiaomi spokesperson said. “The idea is to invest in start-ups which can further boost the mobile ecosystem in India. They could be into mobile gaming, service providers, value-added services or servicing the mobile industry.”
Xiaomi has been rapidly expanding its businesses in India, selling smartphones, television sets, security cameras, speakers, power banks, and more. India was the first market outside China where Xiaomi introduced its television sets.
Asked which sector would be Xiaomi’s focus for investment in the coming years, the spokesperson said the company was looking to focus on hardware-related start-ups in the ecosystem which could offer “robust solutions” to its Indian requirements.
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While hopes for India’s start-up sector are high, there have been some disappointments. There were reports this month that Alibaba, a major shareholder in Paytm, was unhappy with the Indian firm’s performance, pressuring it to realign its strategies and looking unlikely to provide fresh capital.
Paytm, a digital-payment-system unicorn, launched its own e-commerce Paytm Mall in 2016 when Walmart-backed Flipkart and Amazon were dominating the market.
However, the venture has yet to take off and is burning through cash.
Paytm refused to comment on the matter.
NEW REVENUE STREAMS
Chinese firms’ coordinated effort to enter the Indian start-up scene has made it easy for Indian ventures to access new sources of revenue. For instance, the state-run Industrial and Commercial Bank of China (ICBC), the country’s largest lender, launched an India-specific investment fund for Chinese investors in May last year.
Several Chinese venture capitalists are also providing platforms for entrepreneurs through fellowship schemes. Four Indian ventures – Zefo, Healthy Buddha, NowFloats and Grozip – took part in one such fellowship initiative run by Alibaba last year.
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India has warmly welcomed these initiatives. Amitabh Kant, chief executive of state-backed policy think tank Niti Aayog and a close aide of Modi, has publicly said China should become the topmost investor in its neighbour.
Vikram Misri, India’s ambassador to China, has also been pushing for increased economic cooperation and Chinese investment since he took charge in January, despite expressing concerns over New Delhi’s widening trade deficit with Beijing.
The increased Chinese investment in Indian ventures has coincided with the Modi administration’s 2015 launch of the Startup India initiative, an umbrella scheme aimed at easing related activities through measures such as tax exemptions and simplified paperwork.
Industry pundits say active cooperation between Chinese investors and Indian entrepreneurs holds a multitude of benefits for both sides.
“The cooperation gives Chinese investors global scale and opportunity to diversify their investments,” said Neil Shah, partner and research director at the technology market research firm Counterpoint.
The growing importance of China to Brazil’s economy has created a difficult position for President Jair Bolsonaro, who accused Beijing of trying to buy Brazil during his election campaign, but changed tack on assuming office in January.
In March, Bolsonaro called China his country’s “main partner, politically as well as economically and commercially” and announced plans to travel to Beijing this year, a visit which was confirmed on Tuesday for late October.
China is now Latin America’s second largest trading partner with bilateral trade at US$307.4 billion, growing 18.9 per cent over the previous year, according to China’s ministry of commerce, in a relationship focused on commodity imports, including mining products like copper and energy, as well as soybeans and other agricultural goods.
While the US and China have tentatively agreed to resume talks in Shanghai next week, China and Latin American countries are likely to continue deepening their trade relations as production chains realign as a result of the trade war, according to Gustavo Oliveira, assistant professor of global and international studies at the University of California, Irvine.
“This means Chinese imports of Latin American agricultural and mineral commodities, and Latin American imports of Chinese manufactured products and hi-tech, might contribute to China’s ability to stand its ground against US pressure,” he said.
Pompeo blasted China’s role in the region during a previous tour of South America in April, when he singled out Beijing’s support for President Nicolas Maduro of Venezuela. Maduro is backed by Beijing, Russia and other allies, while the US and many European countries have supported opposition leader Juan Guaido as legitimate president since elections in January.
Speaking from Chile on that tour, Pompeo said Beijing’s calls for non-intervention in Venezuela were “hypocritical” and aimed at protecting Beijing’s investments in the country, as well as debts owed to China by Venezuela.
Pompeo also accused Beijing of “sowing discord” in the region through debt traps. “When China does business in places like Latin America, it often injects corrosive capital into the economic bloodstream, giving life to corruption and eroding good governance,” he said.
Professor Cui Shoujun of Renmin University in Beijing said Washington’s concerns about “debt trap diplomacy” in Latin America reflected concerns that China’s growing involvement in financing infrastructure and development projects would make the region more pro-China.
“China’s interests in Latin America go beyond raw materials extraction,” he said. “The biggest point of tension between the US and China in the region is perhaps that China presents an alternative model for development that is very different from the Western model.”
‘Mr Pompeo, you can stop’: China hits back over Latin America criticism
While the US was drumming up tensions about China across the world, Beijing was not openly retaliating but responding with investment and trade for global partners, said Kevin Gallagher, researcher on China-Latin America ties, and professor at Boston University.
“The US points fingers and makes angry speeches in the region as China cuts investment deals and helps address infrastructure needs,” he said.
“Latin American countries’ governments are rightly keeping their heads down on the broader geopolitical winds, and are getting down to business with their largest trading partner.”
Source: SCMP
BEIJING, July 26 (Xinhua) — Chinese President Xi Jinping on Friday sent a message of condolences to Tunisia’s interim President Mohamed Ennaceur over the passing away of President Beji Caid Essebsi.
Xi, on behalf of the Chinese government and people, and also in his own name, expressed deep condolences over the death of Essebsi, and extended sincere sympathy to Essebsi’s family and the Tunisian people.
Essebsi was an outstanding Tunisian statesman, Xi said, adding that he led the Tunisian people in overcoming various challenges facing the country’s development, and made positive efforts in promoting stability and development in his country.
Essebsi committed himself to furthering the development of China-Tunisia relations, and made positive contributions to promoting the two countries’ friendly cooperation and the two peoples’ friendship, Xi said.
China attaches, said Xi, great importance to the development of China-Tunisia relations, and is willing to join efforts with Tunisia to push forward the two countries’ friendly and cooperative relationship.
On the same day, Chinese Premier Li Keqiang sent a condolence message to Tunisian Prime Minister Youssef Chahed over Essebsi’s death, expressing deep condolences to the Tunisian government and extending sincere sympathy to Essebsi’s family.
Source: Xinhua
and China’s purchase of US farm products instead of political issues that will be more difficult to resolve.
“The Shanghai talks will only result in a small step,” Shen said.
and Treasury Secretary Steven Mnuchin are expected to lead the US delegation to meet their Chinese counterparts headed by Vice-Premier Liu He and Commerce Minister Zhong Shan, the South China Morning Postreported earlier this week.
“Shanghai is the window of China’s reform and opening up and the country’s economic heart,” Liao said. “It could be a positive change”.
Larry Hu, chief China economist of Macquarie Capital, noted that Shanghai has played a unique role in US-China relations.
“The important Shanghai Communiqué was inked in the city,” Hu said, referring to the diplomatic document signed between China and US in 1972 during president Richard Nixon’s visit to China to meet Chinese chairman Mao Zedong.
The document, which is part of the Three Joint Communiqués, paved the way for Beijing and Washington to establish official diplomatic relationships later that decade.
The Three Joint Communiqués are a collection of joint statements made by the governments of the US and China from 1972, 1979 and 1982.
Source: SCMP
and
met last week on the sidelines of the Shanghai Cooperation Organisation (SCO), the bonhomie seemed like it was there to stay.
(BRI) in the SCO summit’s Bishkek declaration.
finally stand? Somewhere in the middle, by all indications.
in Osaka, there have been increasing signs that both countries may now be trialling a fresh approach to diplomacy – one that neither sidesteps contentious issues nor does it allow differences to derail ties.
and the BRI – from other non-contentious issues of cooperation in other sectors.
But the jury is still out on whether it will pay off, especially given the historical distrust and the baggage that both countries carry.
ROAD BUMPS GALORE
In the last week alone, there have been at least three flashpoints in the Sino-India relationship.
While the dust was still settling on India’s refusal to sign the Bishkek declaration endorsing the BRI, reports emerged that the
was expected to scrap plans to build jointly with China an ocean observatory overlooking the Indian Ocean. The news came a week after Modi had visited the Maldives capital Male in early June.
The Maldives’ decision to build the observatory was first mulled in December 2017, raising the Indian establishment’s hackles as it would have given China a presence in the region.
Another irritant between India and China has seemed to be the proposed 16-nation
(RCEP). India has been lukewarm on the free-trade bloc, frustrating the Chinese. Indications have been that China is likely to push for a 13-member bloc at the coming RCEP meeting in Thailand on June 20, excluding India.
STRONG LEADERS, STRONGER AGENDAS
The approach might also have to do with where both leaders currently stand.
. Through the campaign, Modi portrayed a hardline image of himself and his government, especially on issues of national security. Similarly, Xi has emerged as a stronger leader since his reappointment last year – his approach marked by a higher-than-ever emphasis on economic nationalism and connectivity. Modi made a reference to this in his SCO meeting with Xi.
Economic Corridor (CPEC), which runs through the disputed region of Kashmir.
“But to make sure this does not affect the relationship, PM Modi and President Xi are meeting numerous times,” Hashmi said. “The message is loud – India’s opposition to the BRI does not mean India will allow adversarial relations to develop between the two.”
A NEED FOR EACH OTHER
Another factor that has likely prompted the new approach between India and China is their need for each other, particularly as both Asian powers navigate bumpy relationships with US under
and is reeling from the tariffs imposed on Chinese imports to America. India, too, has seen a similar but smaller version of this trade battle play out – things have escalated especially since the Trump administration withdrew its preferential trade treatment towards India. Responding to this, India imposed tariffs on 28 US products over the weekend.
“Despite the chemistry, India and China’s promises to each other on the economic front haven’t materialised on the ground. Major projects as well as investments in each country are stuck.”
Source: SCMP
Luhut Pandjaitan, coordinating minister for maritime affairs, said separately the fund should provide loans “with low interest in regards to investment in Indonesia, in partnership with Indonesian companies”.
Pandjaitan, who oversees belt and road projects in Indonesia, previously said the Indonesian government had offered China involvement in about 30 projects, worth US$91 billion, during the second Belt and Road Forum in April.
The most high-profile belt and road venture in Indonesia is a US$6 billion high-speed rail project connecting the capital, Jakarta, to the textile hub of Bandung, awarded to a consortium of Chinese and Indonesian state firms in 2015.
The project has faced land ownership issues.
Another controversial project is a US$1.5 billion hydropower plant, funded by Chinese banks and being built by the Chinese state firm Sinohydro, in the heart of the Batang Toru rainforest on the island of Sumatra, which is home to the endangered Tapanuli orangutans.
Agus Djoko Ismanto, an executive of the power plant developer PT North Sumatra Hydro Energy, on Wednesday denied disrupting the orangutan habitat. He said 11 per cent of the construction had been completed and it was due to begin operation by 2022.
The two countries would meet in the southwestern Chinese city of Chengdu next month to discuss the arrangements, he added, without giving other details.
India and China fought a war in 1962 and the unresolved dispute over stretches of their 3,500km (2,200 miles) border has clouded relations ever since.
But the two big Asian economies share similar positions on a host of issues including concern about US tariffs and Chinese President Xi Jinping and Modi agreed in April to improve relations.
Source: SCMP
summit of world leaders in Osaka, Japan.
with US President Donald Trump, seeking to reach a truce on the year-long trade conflict between the world’s two biggest economies.
“The rise of protectionism and unilateralism has severely affected global stability and economic growth, as well as the existing international order which emerging economies and developing countries have relied on,” Xi was quoted as saying by state broadcaster CCTV.
“China, Russia and India should take on global responsibility to safeguard the fundamental and long-term interests of these three countries and the world,” he said.
Xi also called for the nations to promote “a more multipolar world and the democratisation of international relations” – meaning with less reliance on a US-led world order.
During a meeting with leaders of the other BRICS countries – major emerging economies Brazil, Russia, India, China and South Africa – Xi also said Beijing opposed what it saw as “illegal and unilateral sanctions” and “long-arm jurisdiction”.
The efforts to forge closer ties among China, Russia and India come as all three nations are locked in disputes with the United States.
New Delhi, a key strategic ally in Washington’s Indo-Pacific policy to contain China’s rise, has been upset over tariffs imposed on Indian goods by the Trump administration. Meanwhile, geopolitical rivalry and the Kremlin’s alleged meddling in US elections has strained relations between Moscow and Washington.
Wu Jianghao, director general of the Chinese foreign ministry’s Asian affairs department, said the trilateral meeting laid out a framework for future cooperation.
“The three countries have spoken with one voice on some major global issues, helping stability and injecting positive energy to the current international situation – which is filled with instability and uncertainties,” Wu said at a briefing on Friday.
Wu said that the leaders did not talk about Huawei Technologies or 5G networks, but that the three countries had maintained good communication on telecoms issues and would continue to cooperate.
Washington has banned US companies from selling American technology to Huawei and put pressure on its allies to block the Chinese tech firm over security concerns.
Meanwhile, the United States is also seeking to build ties with India, with Trump holding trilateral talks with Modi and Japanese Prime Minister Shinzo Abe on Friday.
Indian Foreign Secretary Vijay Gokhale described that trilateral meeting as “very good”, saying it was “short but very productive”.
“The main topic of discussion was the Indo-Pacific, about how the three countries could work together in terms of connectivity, infrastructure and ensuring that peace and stability is maintained, and working together to build upon this new concept so that it would benefit the region as a whole and the three countries,” Gokhale said.
On the Modi-Trump bilateral meeting, he said the two leaders had “a very warm discussion”. They also briefly discussed 5G, with the focus on business cooperation between the two countries to leverage their technology and the potential of the Indian market, according to Gokhale.
He said the discussion of how to develop 5G networks was “in terms of business, not in terms of governments”. “It’s an exciting new area that India and the US can work together [on],” he said.
Source: SCMP
While the two nations’ militaries communicated extensively, it was mainly between their land forces, and that should be extended to the navies and air forces, Vikram Misri said.
“We need to talk about the two air forces and the two navies – especially the two navies – because we are operating in the same waters and increasingly in the coming years, we will be meeting more and more in common waters,” Misri said.
Misri said the two nations had made incremental progress, and opened new points where “border personnel can meet and exchange information, or exchange views about any particular situation”.
The ambassador was visiting the Indian consulate in Hong Kong over the weekend, six months after taking up the post and six weeks after Prime Minister Narendra Modi was re-elected.
He said preparations were under way for Chinese President Xi Jinping to visit India, which was expected to happen in the fourth quarter, after they pledged earlier to strengthen cooperation.
Tensions between
have periodically flared along their 4,000km (2,485-mile) border, resulting in a brief war in 1962. Relations have also been strained by China’s ties with Pakistan, and India’s concern over China’s growing presence in the Indian Ocean.
, which has projects that run through the disputed Kashmir region.
But he said the two nations should not let their differences evolve into disputes, and they should focus on areas where they can cooperate.
One such area was maritime and investment cooperation in the Indo-Pacific region, including infrastructure and disaster response. The US in recent years has focused on the Indo-Pacific region, and has asked its allies to send naval vessels to the area as a counterbalance to Beijing.
“We have made the point that our vision of the Indo-Pacific is not a strategy, which sometimes is a concern on the part of some partners, aimed against any particular country,” Misri said. “It is definitely not a military alliance in any format.
“It is on the other hand a vision that aims at economic and development cooperation with our partners in the Indo-Pacific space,” he said, adding that India was discussing such cooperation with China.
He also said trilateral meetings between China, India and Russia would become more regular after their three leaders met on the sidelines of the
summit in Osaka, Japan last month, when they vowed to uphold multilateralism.
India also had a trilateral meeting with Japan and the United States during the G20 summit.
“The fact that these countries seek us out also shows that they see value in engaging with India, and we have important issues to discuss in each of these settings,” he said. “None of our individual relationships is going to come at the cost of a relationship with any other partner.”
Misri also said there could be a broader consensus between China and India on counterterrorism. The two nations have clashed over Indian efforts to blacklist Masood Azhar, leader of the Pakistan-based terror group Jaish-e-Mohammed (JeM), at the United Nations, which China objected to for years – a move seen in India as being done at the behest of Islamabad.
Azhar was finally listed as a global terrorist by the UN in May, after JeM claimed responsibility for a deadly terror attack on Indian security forces in Pulwama in February, although the listing did not directly reference the attack.
“It could have happened earlier … but I’m glad that it did happen, and we hope to build on that – that should be taken as progress, and we hope to build on that in the coming years,” Misri said.
“Everybody is aware of the context in which the listing happened, and therefore, I don’t think it’s hidden from anybody as to what this was aimed at or who this was aimed at, or what the motivation for the action might have been.”
As for the tensions between India and Pakistan following the terror strike in Indian-controlled Kashmir, Misri said progress would be “largely dependent on Pakistan” and the actions it needed to take to address the “ecosystem of terror that prevails in different parts of that country”.
Source: SCMP
continuously updated blog about China & India
continuously updated blog about China & India
continuously updated blog about China & India
CHINDIA ALERT: You'll be living in their world, very soon 