China and India have recently signed memorandums of understandings (MOUs) and agreements worth more than US$22 billion, according to India’s Ministry of External affairs. These 26 MOUs and agreements, signed during Indian Prime Minister Modi’s May 2015 visit to China, include a US$2.5 billion financing commitment, multiple industrial parks, and the establishment of a sister port relationship between the ports of Guangzhou and Mundra.
Infrastructure, power, renewable energy, steel, and small- and medium-sized industries were among the industries included in the 26 business deals set to occur, with many of the India-located projects contributing to the Government of India’s “Make in India” initiative to encourage the manufacturing of products within India. These deals build upon the US$20 billion worth of Chinese investments into Indian industrial parks, railways, credit, and leasing agreed to during Xi Jinping’s September 2014 visit to India.
The entertainment and film industries were also targeted as areas of cooperation, as were the offshore delivery, high-tech capital goods, and information service and technology industries. Modi’s keynote address at the India-China Business Forum in Shanghai identified manufacturing, processing, and infrastructure as three areas of potential greater Chinese investment, and identified new Indian policies meant to attract foreign direct investment. Said policies to improve the ease of doing business for investors include investor-friendly transparency, taxation, infrastructure, and simplification of forms and trade. According to India’s Department of Commerce, China is India’s largest trading partner and largest source of India’s imports.