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How did the India-China dispute affect business?

Posted on 22nd Aug 2020 02:06 pm by rohit kumar

The deteriorating relationship between India and China is indicating that even though the two countries have shown warmth in the last few years, some fundamental disputes remain between them.

 

In such a situation, India's foreign policy role becomes very important regarding the future of mutual relations between the two countries.

 

India's former foreign secretary Nirupama Rao says that "there has not been a single bullet on the LAC in the last 45 years, but now everything seems to be scattered due to the Galvan incident."

 

India has had a friendly attitude towards China in the last decade. China has also invested in India and both countries have been doing business.

 

After the border dispute, India's ban on Chinese mobile apps was also a limited step.

 

Ein Bremer, president of the Eurasia Group, admits that 'India does not want to promote border disputes'.

 

He told the BBC, "It is very clear that the Indian Army is not even close to the Chinese military's firing capability and does not want to escalate the dispute with China on the border, but India has a very popular Prime Minister and China's To enhance their nationalist image by speaking against them gives them a political advantage, it also helps the industry in the country and it is an effective way for Indians to come back against China in the area of ​​their choice. "

 

India trade between China

The story of the development of mutual trade between India and China is encouraging.

 

It cost only $ 3.6 billion in 2001. In the year 2019, the bilateral trade reached about $ 90 billion.

 

China is India's largest trading partner.

 

This relationship is not one-sided. If today India is the world's largest exporter of generic medicines, then China also has a big contribution in it, because the raw material for general medicines comes from China.

 

Apart from trade, the two countries have also invested in each other, but far less than their potential.

 

Despite the 1962 war and the ongoing tension in the Line of Actual Control, mutual trade has continued to grow.

 

On the Indian side, there are complaints that China's exports to bilateral trade are two-thirds.

 

Given the 50 billion dollar trade deficit between India and China, taking a more drastic step may reverse India.

 

India needs to take steps carefully. He has to take care of his geopolitical aspirations as well as economic needs in the area.

 

China and India are big markets for each other's producers.

 

Also, both these countries are the biggest and attractive markets for the USA and Western countries.

 

According to the International Monetary Fund (IMAF) 2019 figures, the world's collective economy is worth about US $ 90 trillion with China contributing 15.5 percent and India contributing 3.9 percent.

 

On 22-23 percent of the world's economy, 37 percent of the world's population is responsible for taking care of it.

 

Belt and Road project challenge for India

Along with this, China's belt and road project under which highway, railway, port is also being built in neighboring countries can prove to be a challenge for India in times to come.

 

According to Ian Bremer, "China will have a great influence on these countries. Indians find themselves on the back foot. China is a capitalist economy where a lot of investment is happening at the behest of the government and the government is getting political benefits. India "It's a growing challenge."

 

Stability in this area will depend on how the two countries work together in the coming times.

 

The China-Pakistan Economic Corridor or CPEC is also part of the business network being built under China's ambitious Belt and Road project.

 

Several infrastructure-related projects are underway in Pakistan under CPEC, in which China has an investment of $ 62 billion.

 

China considers Cepec the most important of all its projects.

 

The violent clash took place on 15 June in Galvan

On June 15, 20 soldiers of India were killed in a clash between Indian and Chinese soldiers in the Galvan Valley.

 

China has not officially given any information about the casualties yet.

 

Since then, there has been a gathering of troops from both countries in the border area.

 

Negotiations are continuing at both military and diplomatic levels in both countries and claims are also being made to reduce tensions.

 

However, last month when Defense Minister Rajnath Singh said in Ladakh that talks are going on in both countries and the problem should be resolved. At the same time, he also said that to what extent this matter will be resolved, he cannot guarantee it.

 

After the incident of June 15, India and China have held several talks.

 

The armies of both the countries have retreated from many areas, but still, talks are going on in some countries about some areas.

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