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China Seeks Preferential Trade Regime for Investing in India

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CHANDIGARH, India – In order to consolidate its 80 million plus annual production the vast Chinese bicycle and e-bike industry is looking for new markets. India is regarded as potentially interesting as the country is switching to premium bicycles as well as e-bikes. For an investment cooperation China seeks a preferential trade regime, as became evident at the Asia Bicycle Alliance Conference which took place December 8 and 9 in India.

China Seeks Preferential Trade Regime for Investing in India
Ma Zhongchao, Chairman of the China Bicycle Association, ‘Looking for partners in emerging markets like India.’ – Photo Bike Europe

Despite trade barriers like the 48.5% anti-dumping duty for its bicycle and parts export to the EU, China continues to export globally some 55 million bicycles. But that huge export is under pressure which is turning China to focus more on its domestic market as well as new markets.

In an interaction with Bike Europe Ma Zhongchao, Chairman of the China Bicycle Association (CBA), said on this at the Asia Bicycle Alliance Conference, “The industry is focusing now more on innovation and making hi-end bikes using smart technology. It is also looking for partners in emerging markets like India.”

Joint venture possibilities

Ma was heading a formidable delegation comprising of key bicycle producers from China at the Asia Bicycle Alliance conference held in Northern Indian city of Chandigarh on 8 and 9 December. The Chinese companies have shown keenness on exploring joint venture possibilities in India in near future. The Shanghai based Phoenix Group is one of these companies that was looking to enter into JVs with Indian producers.

Attracting Chinese investments

“For attracting investments from Chinese companies we urge the Indian government to provide a preferential trade & taxation regime,” said CBA Chairman Ma.

Next to Phoenix there are other major Chinese producers looking for an entry into the India market. One of them is China’s biggest bicycle and e-bike producer Fushida. This company is said to be producing over ten million bikes annually.

Stabilizing production

In the first ten months of this year China exported 437,000 bicycles to India. In India annually some 15 million bikes are produced which stands small compared to China’s 80 to 85 million yearly production. When asked about growth prospect for the Chinese industry CBA Chairman Ma pointed out, “Don’t expect further growth. China’s bicycle production is expected to stabilize at some 80 million units. We also produce about 30 million electric bikes in a year and exports merely 5% of that production.”

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