New Delhi: India and China, the two fastest growing economies in the world, are set to achieve a bilateral trade target of $60 billion by 2010 despite the Indian industry becoming wary of signing a free trade agreement with the neighbouring economic giant.
China’s Ambassador to India Zhang Yan said here on Monday that the Chinese government would provide full support towards realising the target for bilateral trade, which is increasing by 50% per annum.
He said, the bilateral trade between the two countries was in order of $38 billion last year.
“People are stressing that India and China are the future of the world economy,” Yan said, adding both India and China are facing unique opportunity to strengthen themselves economically.
While the two governments have set the $60 billion trade target in the next three years, a study by the Federation of Indian Micro and Small and Medium Enterprises (FISME) indicated that it would surpass it and reach the $100 billion mark by 2010.
However, industry body Assocham said that the government should adopt an “extremely cautious approach” before signing a Free Trade Agreement with China, as the resultant tariff cuts will see the Chinese goods flood Indian markets.
Suggesting that the government undertake a comprehensive consultation process with Indian industry, the chamber has prescribed a minimum period of five years before the two countries finalise the FTA.
FISME’s study - ‘Business opportunities for Indian SMEs in China´ identified about 100 products which has wide scope of exports to China.
As per the study, there is huge potential in the areas such as textiles, apparels, leather, chemicals.