In recent years, China-India relations have been developing smoothly. When Premier Wen visited India in 2005, China and India announced the establishment of strategic cooperative partnership for peace and prosperity.
The two countries finished joint research onthe Five-year Plan of China-India Comprehensive Trade and Economic Cooperation in March 2005, and the Plan becomes a guiding document for the development of trade and economic cooperation.
The year 2006 was a year of friendship bteween China and India, and was a year of milestone in bilateral diplomatic history. The Joint Statement released by President Hu Jintao on a visit to India served as a blueprint for cooperative development in various fields henceforth.
Bilateral Trade Grows with Great Strength
China-India trade has been growing so fast in recent years that trade value has kept growing rapidly. Bilateral trade increased from 2.914 billion USD in 2000 to 18.703 billion USD in 2005, with an average annual growth of 45%. It reached 24.9 billion USD in 2006, meeting the target set by the leaders of the two countries in advance. According to China's statistic, India China's 10th biggest trade partner in 2006. And China became India's 2nd biggest trade partner in the 2005-2006 fiscal year in accordance with India's statistic.
Broad Cooperation in Contractual Projects
India has tried hard to build infrastructure in recent years. A large number of private enterprises invested heavily, planned to build a set of infrastructure like roads, bridges, railways, ports and power stations, so that a huge market of contractual projects has emerged. According to the Federation of Indian Chambers of Commerce and Industry, India needed 380 billion USD in investment in infrastructure construction in the next 6 years.
Chinese enterprises possessed great predominance in such fields and they made great progress in the Indian contractual projects market, especially in cash and owner financing projects, through years of exploration.
By the end of 2006, China signed 7.012 USD economic and technological contracts in India, with a 2.108 USD turnover. In the recent 3 years, in particular, China has been in favorable development in the contractual projects market. From 2004 to 2006, Chinese enterprises signed 5.616 USD projects in India, with a 1.792 billion USD turnover, of which contractual value reached 3.298 billion USD in 2006. India now has become one of China's most important overseas contractual project markets.
Investment Cooperation on the Upswing
Mutual investment of the two countries has just started. By the end of 2006, approved or recorded by the Ministry of Commerce, China's investment in India amounted to 17 million USD, in such fields as the electric industry, communications and light industry.
By the end of 2006, India's non-financial investment projects in China totaled 256, with a 548 million USD contractual values and 172 million USD in actual use. The investment fields involved metallurgy, electric appliances, pharmaceuticals, printing ink and textiles. Chinese enterprises such as Haier, TCL, Huawei and ZTE have set up manufacturing factories or researching institutes in India, and India's enterprises including Tata Consultancy Service Corporation and INFOSYS invested in China as well.
Frequent Bilateral Business Visits
In recent years, there have been frequent China-India bilateral trade and economic visits, so that more and more people have attended all kinds of exhibitions and expositions and the number of people who have gone on tour and business increased substantially. In 2005, people from China and India entering each other's country reached 360,000 person-times. In March 2002, China Eastern Air Company was the first to open the air route from Beijing to New Delhi via Shanghai. In addition, Air India opened an air route to Shanghai via Thailand in Nov 2003. Air China opened airline services from Beijing to New Delhi in Oct 2006 as well.
