NEW DELHI: Facing the slowdown blues back home, most of the Indian companies working in China plan to ramp-up their investments this year, said a survey, adding these firms do not see any significant impact of the current trade war between China and the US.
A joint survey by industry body Confederation of Indian Industry (CII), and research and analytics company Evalueserve which received responses from 57 Indian companies in China, said 98 per cent of the respondents plan to make some investments in China this year, with two-fifth considering ramping-up their investments over 2018.
Moreover, the number of IT and business process outsourcing firms that plan to make investments in China in 2019, has increased compared to the previous year.
The survey titled ‘Business Climate for Indian Companies in China’ noted that 74 per cent of the firms are of the view that trade friction involving China and the US had no impact on their business. Of these, 26 companies have a business presence in the US as well.
According to the survey, two-thirds of the companies said that their businesses were “very profitable or profitable” in 2018, with higher earnings before interest and taxes compared to 2017.
Of the surveyed firms, 30 per cent generated revenue higher than CNY 100 million (approx Rs 101 crore) from China in 2018, and 4 of 5 respondents stated that their revenue in 2018 was higher than the previous year, it added. The largest proportion, 72 per cent of Indian firms have invested in Shanghai, the most popular destination, it said.
Besides, 72 per cent of the respondents have up to 50 employees and hire over half the workers locally. Among the challenges, while half of the firms felt China’s innovation is more favourable than the worldwide average, rising labour cost, finding and retaining talent, and stricter regulations were the top-cited issues. The quality of products and services continues to be a key success factor in China. The survey of Indian firms working in China shows cautious optimism and confidence ...Most firms don’t see a significant impact of the trade war between the US and China, said Chandrajit Banerjee, DG, CII.