Chinese President Xi Jinping will arrive in India next week with a promise of investing $100 billion or Rs 6,00,000 crore over five years.This is nearly thrice the $35 billion investment commitment secured by PM Narendra Modi during his Japan trip.
Confirming the investment promise, Liu Youfa, China's consul-general in Mumbai said, “On a conservative estimate, I can say that we will commit investments of over $100 billion or nearly thrice the investments committed by Japan during our President Xi Jinping's visit next week. These will be made in setting up of industrial parks, modernization of railways, highways, ports, electricity generation, distribution and transmission, automobiles, manufacturing, food processing and textile industries.“ Chinese President Xi Jinping will land in Gujarat on Modi's birthday--September 17-after wrapping up his visit to Tajikistan, Maldives and Sri Lanka. The consul-general's statements coincide with Modi's call for world class infrastructure projects after his review of major infrastructure sectors on Friday. The government also announced new projects worth Rs 9 lakh crore in energy, power, and roads.
China will initially invest $7 billion in industrial parks in Pune and Gandhinagar. “The Pune industrial park -spread across 5 square kilometres with an investment of $5 billion -will be for automobiles that will employ one lakh people and manufacture 1.5 lakh speciality vehicles. The Gujarat industrial park will be for manufacturing power equipment. China is also working on setting up an industrial park in Tamil Nadu for the textile sector and another one for the food processing sector,“ said Liu. Chinese investments in industrial parks are just the tip of the iceberg as Chinese firms are eyeing over $50 billion worth of investments in modernization of the Indian Railways and running bullet and hi-speed trains in India. Modi on Friday said that the railways has been granted clearance for 100% FDI, and therefore it should come up with a comprehensive plan for facilitating FDI in the sector. “The first bullet train project was given to Japan, which was a government decision. We are optimistic of building India's next bullet train in India. Besides bullet trains, we want to connect the cities with hi-speed trains with speed of 160 km hr. We will also look at modernization projects of Indian Railways across the country,“ said Liu.
China is willing to invest another $50 billion in roads, ports and the NDA government's ambitious river-linking plan. “India has over 600 reservoirs that need dredging work to provide better irrigation systems for the farmers. We are looking to work on that. Besides, our major thrust will be on construction of roads and ports,“ said Liu.
Meanwhile, road transport and highways minister Nitin Gadkari on Friday announced the launch of new roads and highways projects this year worth Rs 2 lakh crore. Power minister Piyush Goyal said that $100 billion of investments are likely to flow into India's renewable sector in the next four years. Oil minister Dharmendra Pradhan, while meeting Odisha chief minister Naveen Patnaik, said that Odisha alone will receive about Rs 1 lakh crore worth of investment in the next five years in petrochemicals, oil & gas pipe lines, LNG & LPG terminals, and strategic oil reserves to make it the `energy gateway' for eastern India.
The Chinese president is coming with a delegation of over 100 business heads, including those from China Harbour, China Railway Construction Group and Huawei, among others, and will address a business gathering of over 400 Indian CEOs in Delhi. The big four Chinese banks -Bank of China, Industrial & Commercial Bank of China (ICBC), China Construction Bank and the Agriculture Bank of China -are also coming with the delegation to give billions of dollars in loans to Indian infrastructure projects to be done in joint venture with Chinese firms.
“All major JV projects will be funded by Chinese banks. Major corporate houses like Tatas, Infosys, Reliance and Essar have already taken loans from these banks and the funding will only increase,“ said Liu.
The India-China bilateral trade stands at $65 billion of which trade deficit of $35 billion is in favour of China.
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