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How should India deal with China and Chinese companies? Niti Aayog gave this important advice – AnyTV News

by Aaryan Srivastav
August 4, 2024
How should India deal with China and Chinese companies? Niti Aayog gave this important advice - India TV Hindi


Photo:FILE Chinese Companies

coming from china The investment and policies of Chinese companies towards India have always been a cause of trouble. India has always been working on new strategies to deal with Chinese companies. Now NITI Aayog member Arvind Virmani has said that it would be better for India to attract companies of the neighboring country to invest and produce goods in India instead of importing products from China. He said that such a step will encourage local manufacturing of products. It will also help in bridging the trade deficit. Indian companies will also benefit from this step.

FDI was advocated

It is worth noting that the Economic Survey presented on July 22, a day before the general budget, advocated foreign direct investment (FDI) from China to promote local manufacturing and take advantage of the export market. Virmani was asked about this. Virmani said, “So, the way an economist looks at it. If something is going to be imported, which we are going to import for 10 years or 15 years anyway, then it would be better if we attract Chinese companies to invest in India and produce here.” The Economic Survey said, “Since America and Europe are removing their immediate sourcing from China, it is more effective for Chinese companies to invest in India.”

‘China Plus One Strategy’

The review said India has two options to benefit from the ‘China plus one strategy’ – it can integrate into China’s supply chain or promote FDI from China. “We should allow imports from China rather than continuing imports from it,” Virmani said. He said among these options, focusing on FDI from China appears more promising to increase India’s exports to the US. “Furthermore, choosing FDI as a strategy to gain benefits from China appears to be more beneficial than relying on trade. This is because China is India’s top import partner, and the trade deficit with China is growing,” it said.

Relations between the two countries are quite sour

China is ranked 22nd with only 0.37 percent share (US$ 2.5 billion) in the total FDI equity inflows that came to India from April 2000 to March 2024. Relations between the two countries have soured significantly after the fierce clash in the Galwan Valley in June 2020. India has always been saying that its relations with China cannot be normal before peace is restored in the border areas. Due to tensions between the two countries, India has banned more than 200 mobile apps of China, including TikTok.

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