Indo-China trade: The bankers' perspective
The banking industry has always had a major role to play in facilitating trade between two countries.
By TNN |
The banking industry has always had a major role to play in facilitating trade between two countries. And transnational banking giant HSBC, which has been playing its part fairly well in helping exporters and importers from the between India and China execute their trade transactions with ease, is looking at further strengthening its relations with traders in the two countries.
On the sidelines of the conference on Indo-China trade (focussing on SMEs) organised by ET and HSBC, Mr Mark Evans, head, trade services and supply chain, Asia Pacific (ex-Greater China), HSBC and Mr Puneet Chaddha, country head, commercial banking, HSBC India, spoke at length about various aspects concerning trade relations between the two nations that are billed as potential economic superpowers.
Mr Mark Evans, head, trade services and supply Chain, Asia Pacific (ex-Greater China), HSBC, is of the firm opinion that while US continues to be the centre of attention in terms of world trade, intra-Asian trade is steadily gaining in importance. "The US has always been important and this scenario is not going to change overnight.
It has often been said that if the US sneezes, the world catches cold, but things have started changing. If there is a US downturn, it will no doubt have an impact, but we are beginning to see intra-Asian trade acquiring great significance, increasing confidence among Asian countries. Asian companies are coming up with better quality products and their brand visibility is going up."
Talking specifically about China, Mr Evans reiterated what he had said during the panel discussion: "While carrying out trade with China, like any other market, it is important to do due diligence. Knowing your counterparty well is very crucial."
He also felt that opening up of lines of communication is the key to enhancing the level of trade between India and China. He stressed on the importance of increasing the awareness about opportunities available in both the countries.
When asked if HSBC had witnessed a rise in interest levels of Indian companies for conducting business with China, Mr Evans replied, "There is definitely a greater level of interest now. A number of corporates are talking to us. What's more, SMEs too are participating. The SME market in India is huge and we have seen plenty of enquiries pouring in from this segment."
Echoing Mr Evans' sentiments, Mr Puneet Chaddha, country head, commercial banking, HSBC India, said that the partnership between India and China could play a vital role in improving each others' international competitiveness. "Till recently, the Indian industry tended to focus on the domestic market which is relatively less competitive than the international arena.
Competition from China has encouraged Indian companies to become more cost competitive. This is also prompting Indian manufacturers to look at differentiating themselves - there is therefore an increased focus on quality and on production of value-added products," he explained.
Elaborating on India's plus points, he said that Indians are very entrepreneurial and innovative and this gives them an edge over other upcoming economies. He stated that good command over English is a key strength for India. "As a result, we are better equipped to deal with international clients. And this encourages an international perspective," he said, adding that the ability to adopt systemic change is another strength though the pace at which this takes place can improve.
For instance, Indian capital markets are seen to be amongst the more efficient ones in the world and this was not the case 5-7 years ago, he pointed out.
About trade between India and China, he was clear that Indian businesses would benefit from an increase in their dealings with Chinese companies. Indian entrepreneurs who want to grow have no choice but to know more about China as it is one of the fastest growing economies in the world today and is our next door neighbour as well; in many ways India has similar dynamics to China.
Also, strong complementarities exist between the two - while China is strong in manufacturing, India is strong in services. It is therefore natural for these two economies to interact. Indian companies ignoring China would risk missing a huge opportunity. "We should put in efforts to make sure that we don't miss out on the great opportunity of carrying out trade with China," he concluded.
Now, that should be some encouragement for exporters in India, who wish to do business with China considering the treasure trove of opportunities that the market has to offer, but are hesitant to take that step due to certain misconceptions and misperceptions, which the panel discussion on Indo-China trade sought to clear.
On the sidelines of the conference on Indo-China trade (focussing on SMEs) organised by ET and HSBC, Mr Mark Evans, head, trade services and supply chain, Asia Pacific (ex-Greater China), HSBC and Mr Puneet Chaddha, country head, commercial banking, HSBC India, spoke at length about various aspects concerning trade relations between the two nations that are billed as potential economic superpowers.
Mr Mark Evans, head, trade services and supply Chain, Asia Pacific (ex-Greater China), HSBC, is of the firm opinion that while US continues to be the centre of attention in terms of world trade, intra-Asian trade is steadily gaining in importance. "The US has always been important and this scenario is not going to change overnight.
It has often been said that if the US sneezes, the world catches cold, but things have started changing. If there is a US downturn, it will no doubt have an impact, but we are beginning to see intra-Asian trade acquiring great significance, increasing confidence among Asian countries. Asian companies are coming up with better quality products and their brand visibility is going up."
Talking specifically about China, Mr Evans reiterated what he had said during the panel discussion: "While carrying out trade with China, like any other market, it is important to do due diligence. Knowing your counterparty well is very crucial."
He also felt that opening up of lines of communication is the key to enhancing the level of trade between India and China. He stressed on the importance of increasing the awareness about opportunities available in both the countries.
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When asked if HSBC had witnessed a rise in interest levels of Indian companies for conducting business with China, Mr Evans replied, "There is definitely a greater level of interest now. A number of corporates are talking to us. What's more, SMEs too are participating. The SME market in India is huge and we have seen plenty of enquiries pouring in from this segment."
Echoing Mr Evans' sentiments, Mr Puneet Chaddha, country head, commercial banking, HSBC India, said that the partnership between India and China could play a vital role in improving each others' international competitiveness. "Till recently, the Indian industry tended to focus on the domestic market which is relatively less competitive than the international arena.
Competition from China has encouraged Indian companies to become more cost competitive. This is also prompting Indian manufacturers to look at differentiating themselves - there is therefore an increased focus on quality and on production of value-added products," he explained.
Elaborating on India's plus points, he said that Indians are very entrepreneurial and innovative and this gives them an edge over other upcoming economies. He stated that good command over English is a key strength for India. "As a result, we are better equipped to deal with international clients. And this encourages an international perspective," he said, adding that the ability to adopt systemic change is another strength though the pace at which this takes place can improve.
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For instance, Indian capital markets are seen to be amongst the more efficient ones in the world and this was not the case 5-7 years ago, he pointed out.
About trade between India and China, he was clear that Indian businesses would benefit from an increase in their dealings with Chinese companies. Indian entrepreneurs who want to grow have no choice but to know more about China as it is one of the fastest growing economies in the world today and is our next door neighbour as well; in many ways India has similar dynamics to China.
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Also, strong complementarities exist between the two - while China is strong in manufacturing, India is strong in services. It is therefore natural for these two economies to interact. Indian companies ignoring China would risk missing a huge opportunity. "We should put in efforts to make sure that we don't miss out on the great opportunity of carrying out trade with China," he concluded.
Now, that should be some encouragement for exporters in India, who wish to do business with China considering the treasure trove of opportunities that the market has to offer, but are hesitant to take that step due to certain misconceptions and misperceptions, which the panel discussion on Indo-China trade sought to clear.
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