India should focus on preserving good economic ties with China, rather than on the S.China Sea

By Hu Weijia Source:Global Times Published: 2016/8/8 23:58:48

While many Indian people have been focused on the South China Sea ahead of Chinese Foreign Minister Wang Yi's upcoming trip to the country, less attention has been paid to the recent fall in exports of made-in-India products to China.

India's exports to China have dropped 16.7 percent year-on-year in the first seven months of the year, Chinese customs data showed Monday, suggesting that a large number of Indian enterprises are having a hard time exploring the Chinese market amid simmering tensions between the two countries.

Regretfully, due attention has not been paid to the living conditions of those Indian firms.

For India this comes at a crucial moment when the country is pursuing its "Make in India" strategy that aims to turn the South Asian country into a new global manufacturing center. In this regard, boosting sustainable development in its export-oriented manufacturing will have to become a primary strategy for the country.

It is puzzling that India is focusing on the South China Sea issue at this moment, a move that might risk unnecessary side effects to Sino-Indian ties and potentially set up obstacles for Indian exporters hoping to increase their presence in China, now the world's second largest importer.

Tensions between China and India have been increasing in recent months owing to a series of political incidents. Considering that India does not face territorial disputes with China in the South China Sea, is it worth letting the South China Sea issue become another factor that will impact India's cooperation with China? India should consider this. In fairness, after dozens of countries have expressed support for China's stance in the South China Sea, India's attitude toward the issue may not be as important as the nation had imagined.

India should move its focus from geopolitical competition to economic issues, such as how to stop a further decline in exports to China. Under normal circumstances, defusing the tensions between the two counties will help lay a sound foundation for fostering closer economic ties. In this regard, Wang Yi's trip will offer concrete opportunities for India.

India may want to avoid unnecessary entanglement with China over the South China Sea debate during Wang's visit if the country wishes to create a good atmosphere for economic cooperation, which would include reducing tariffs on made-in-India products exported to China amid the ongoing free trade talk known as the Regional Comprehensive Economic Partnership. India is expected to allow only moderate tariff reduction on made-in-China products under the talks in a bid to preserve its domestic industries. If India wants China to be more generous in terms of tariff reduction, it would be unwise for the country to let its relationship with China deteriorate further at this moment.

The author is a reporter with the Global Times.

Posted in: Eye on The Economy

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