Updated: Sep 1, 2022
Image Courtesy: PTI/The Indian Express
C3S Event Report No: 008/2018
Ms. Shiho Bamba, Consul, Japanese Consulate in Chennai engaged with Chennai Centre for China Studies (C3S) via an informal interaction on the theme ‘Chinese investments in India’ on May 2, 2018, at C3S. Mr. K. Subramanian, Former Joint Secretary (Retd.), Ministry of Finance, Government of India and Mr T.V. Krishnamurthy, an investment banker and a top management professional, graced the occasion to present their views on the trends of China’s investments in India. Cmde. R.S. Vasan – Director of C3S and young researchers were also participants.
The interaction brought out investments of China in various sectors, and the authenticity of available data on China. The discussion also shed light on indirect investments and their impact on economic relations and trade. With regard to these investments, Mr. T.V. Krishnamurthy highlighted that the Foreign Direct Investment (FDI) in India was around US$ 60 billion for the year 2016-2017. A significant amount of investments do not go on record due to the existence of trade on high seas and other routes of indirect investment. For example, Alibaba invests from its California outlet so India is not able to fully capture its investment on paper as a Chinese investment. He thus believes that the investments are much more than what is reflected in numbers. The major section of Chinese investments into India comes into our telecom industry where China controls 51% of the Indian market. There could be a growth in the following sectors, railways, construction, power, automobiles, and renewable energy. There has also been a trend in the investment and funding of high-end information and technology start-ups in Bangalore. He concluded by making an important remark about how one needs to track the trends rather than numbers to fully understand the nature of Chinese investments in India.
Commodore R.S. Vasan, Director of C3S, added a fresh perspective to the interaction by highlighting the need for a multi-lateral dialogue among Europe, Japan, India and other economies. He also urged that a multilateral open-ended investment fund for the economic sector initiated by India and Japan would pave the way for developing economies to examine alternative investment avenues which are benign unlike the Chinese investments which seem to lead these countries toward debt trap.
Mr. K. Subramanian highlighted how Chinese acquisitions of American firms have benefitted the Chinese in advancing their own technology. He discussed the cases of COSCO, a shipping company, as well as pork companies which the Chinese have acquired in U.S.A. This reflected how the Chinese investments work on-ground. A discussion round concluded the interaction.
The PowerPoint Presentation made by Mr. T. V. Krishnamurthy during the event can be viewed at this link:
(Compiled by Sai Deepthi P., Research Assistant, C3S)