Wanda Dalian is a giant Chinese real estate company owned by one of China’s richest tycoons and it’s looking to place a super-sized $10-billion bet on India to build a huge industrial township in Haryana and invest in a host of other projects.

India was conspicuous by its absence at the China-led Belt and Road Initiative in Beijing last fortnight. The snub may have left the impression that geo-politics always frustrates Chinese-Indian commercial relations but that’s far from the truth. Business is going great guns, though Chinese firms are doing most of the running.

Chinese conglomerates such as Wanda Dalian, in fact, are eyeing India as the last big commercial frontier. Hitherto, they built global empires but steered clear of India as just too complicated. Now, India’s attained a scale that can’t be ignored and a battalion of Chinese companies are crossing the Himalayas, betting on virtually bottomless demand for better infrastructure, more manufacturing and rapid urbanisation.

What the numbers say

“Between 2010 and 2014, it was easy to predict which Chinese companies might be interested in India. Now, almost on a monthly basis, new industries are being added,” says lawyer Santosh Pai, partner at top legal firm Link Legal India Law Services, who visits corporate clients in China at least once a month.

The numbers tell how the Chinese have suddenly warmed to India. Around 2010, there were about 30 to 40 Chinese firms in India. Today, that number’s 400-500. According to Indian government statistics, $1.6 billion has come into India from China in 16 years. But Pai, one of the few Indians with LLM and MBA degrees from China, believes that’s a gross underestimate. “The Reserve Bank of India’s numbers show only what comes from a Chinese bank account to an Indian account. Globally, it’s well-known 60 to 70 per cent of Chinese investment comes from tax havens,” he says.

The Chinese pioneers who came to India have already highlighted its rich potential. India’s the world’s second-largest market for telecom solutions firm, Huawei. Chinese mobile phone makers have set up seven factories in India and have cornered 50 per cent of the market. In pharmaceuticals, the FIPB has just cleared China’s Fosun Pharma’s $1.3-billion bid for Hyderabad-based Gland Pharma. Pai reckons the action’s only just started.

Also, take a look at the Indian real estate sector that’s notorious for its byzantine complexity. Wanda Dalian’s assembling a team to run its business here and another real estate major, China Fortune Land Development Company (CFLD), has opened a Gurgaon office. CFLD’s looking at a $5-billion township project in Haryana and other projects in Mumbai. Guangdong-based Country Garden is looking to enter the competitive residential complex space and is talking with Mumbai’s Wadhwa Group. “The population in India has almost surpassed that of China and its economic growth is the fastest in the world. We got very excited after visiting India,” enthused Country Garden president Mo Bin enthused to Hong Kong’s South China Morning Post .

The mood’s catching

A similar scenario is unfolding across other sectors. Chinese solar panel giant Trina Solar has been selling in India for several years and has earmarked a plot near Visakhapatnam where it plans to build a ₹2,800-crore plant. Another Chinese company, CL-Poly Energy Holdings, is eyeing investing in India. Made-in-China solar panels face anti-dumping duties and steep tariffs as the EU and the US have held that they’ve been excessively subsidised, so Indian factories could serve as export hubs.

China’s booming auto giants have also been looking for ways to make a grand debut in the Indian market. The biggest manufacturer, SAIC, is mulling taking over the plant in Halol, Gujarat, that GM’s quitting while two of China’s Big Four manufacturers — Great Wall and Chongqing Changan Automobile — have declared India a key market of the future.

For Chinese automakers there is, of course, the brand issue which is why they’ve hesitated to enter the Indian market: Are Indians ready to drive about in Chinese brand cars? But the Chinese are also strong in trucks and electric vehicles. SAIC, for instance, makes around a million vans every year. And Chinese automakers have a degree of comfort because auto component makers from the Middle Kingdom are already big players here.

Bright spot

Also bringing China’s giants to India is the inescapable fact that the world economy has slowed and this country’s now one of the brightest spots on the map. Many Chinese, too, see India as being where they were a few decades ago. And the biggest thrust into India is coming from powerful tech giants such as Alibaba, a key Paytm stakeholder, and Tencent Holdings, which has placed a big bet on e-commerce’s Flipkart; Chinese travel company Ctrip has taken a $180-million stake in India's MakeMyTrip.

For the Chinese, India was one country that was almost beyond their comprehension. It wasn't like the West but it also wasn’t like Africa. And in South-East Asia, the Chinese moved in with help from local expatriate Chinese communities.

But if the Chinese have suddenly discovered India’s riches, our businessmen are still struggling to figure out China’s complexities. While Indians traders have been buying in a big way ever since the turn of the century and the Tatas got a foothold in the country when they bought Jaguar Land Rover, other companies have been hesitant. Says Pai: “Our understanding of China is very low. There are isolated success stories but it hasn't transformed into a trend.”

Will India suffer and will Chinese investment in this country dry up if New Delhi doesn’t join the Belt and Road Initiative? The answer to that is almost certainly no. The Belt and Road Initiative is all about buying geo-political clout and getting contracts for China’s state-run enterprises and getting markets for the vast amounts of steel and concrete China’s factories are churning out. The companies entering India are coming for entirely different reasons: the sheer size of the market and the prospect that it will burgeon in the coming decade, potentially becoming “China 2.0,” according to Chinese strategic think-tank Anbound.

China’s corporate stars want to be big players in that game.

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