New Delhi: China on Wednesday joined India in opposing protectionism, saying it is detrimental to the “recovery and growth ” of global economy which is going through a very difficult phase.

“China is firmly opposing trade protectionism because such a policy is harmful to the recovery and growth of world economy,” Chinese Ambassador Zhang Yan said here.

He said as a responsible member of the World Trade Organisation, China will continue to stand by the principle of free trade and oppose any form of trade protectionism.

The Chinese envoy’s comments came a day after India said protectionist steps by developed nations would complicate the global financial crisis.

As the US moves towards eliminating tax benefits for American firms outsourcing jobs to foreign countries, Finance Minister Pranab Mukherjee had said developed countries should not resort to protectionism to overcome the financial crisis.

“Any sort of protectionism will complicate the problem instead of resolving it,” Mukherjee said on Tuesday.

Favouring deeper cooperation between China and India in dealing with the financial downturn, the Chinese Ambassador said both countries must guard against protectionism.

“In the G-20 summit in Washington last November, our leaders committed themselves to not adopting measures of trade protectionism,” he added.

“China and India should work hand in hand in a cooperative manner, instead of resorting to protectionism,” Yan said addressing a conference organised by the CII.

On 26 February, US President Barack Obama in his maiden budget speech said his administration would do away with tax breaks for firms outsourcing jobs to overseas destinations, including India. At the same time, the US administration would be providing tax relief to 95% of American working families.

Nearly 1,000 US firms, which have shipped their jobs overseas, are expected to be affected by the proposed elimination of tax incentives.

India has been saying that during the time of crisis developed economies must ensure that there is no hindrance in the flow of investments to developing countries.

The US on 15 November 2008, hosted the first G-20 economic conference, which deliberated on the ways to overcome the financial crisis. The next G-20 summit will be held on 2 April in London.

The Chinese envoy said that as result of the downturn in the economy, China’s export has notably shrunk as about 670,000 small-scale export oriented enterprises have been shut down and 6.7 million jobs have “evaporated”.