The Hindu Business Line : `Lack of awareness on customs norms hinders trade with China'

THE managers of the economies of the two Asian giants - India and China - will have to contend with and address the concerns of Indian industry on doing business with China even as visiting Chinese delegation led by the Premier, Mr Wen Jiabao, and their counterparts in New Delhi get down to initial a comprehensive trade enlargement agenda.

A survey of companies involved in trade with China, conducted by the Federation of Indian Chambers of Commerce and Industry (FICCI), brings into sharp focus the ground-level roadblocks in penetrating the Chinese market. To begin with the Indian companies said that they felt constrained by the lack of information on the Customs procedures in China and imposition of excessive customs and other levies with frequent changes in rates.

Further, there is the issue of standards and conformance norms. Indian companies felt the absence of a designated nodal agency for doing business with China. The survey said that the Chinese authorities also do not accept manufacturers self-certification showing compliance with international product standards and differentiated testing norms applicable to imported and domestic products.

India Inc cited unfamiliarity with the legal and regulatory rules and procedures across various provinces in China. They felt that regulations across China are not homogeneous and that differences also exist with regard to interpretation and implementation of Central Government rules and regulations at the State/provincial level.

While addressing these concerns would become a priority for the Chinese authorities, the FICCI survey listed out a host of steps that the Indian Government would need to introduce to ensure a higher level of trade engagement with China.

These are: Setting up of a India-China Joint Council for dealing with contentious issues; setting up trade promotion offices in Shanghai and Beijing; strengthening direct transportation and shipping links - more direct flights to China; supporting `Showcase India' in China through buyer-seller meets and expos; subsidising freight costs to China; and encourage public sector banks to enter and open branches in China.

Indian industry, on its part, would have to pull up its socks by improving cost competitiveness and productivity, identifying reliable local partners, setting up of local offices in China, commissioning market survey of consumption habits and purchasing behaviour of the Chinese and other nationals in China (especially for the purpose of fast moving consumer goods and durable goods industries), the survey said.

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