"Adopt adequate precaution": India updates trade advisory for Indian SMEs doing business with Chinese firms
Jul 30, 2024
Beijing [China], July 30 : The Indian Embassy in China has updated the trade advisory for Indian small and medium enterprises (SMEs) that intend to or are doing business with Chinese companies. It has advised Indian firms to "note of this advisory and its annexure documents and adopt adequate precaution while dealing with Chinese entities."
In a statement, the Indian Embassy in China stated, "The Embassy has regularly come across several problems faced by Indian companies doing business with Chinese entities in China. It is requested that Indian companies take note of this advisory and its annexure documents and adopt adequate precaution while dealing with Chinese entities."
It advised Indian companies to write to the Indian Embassy before doing business with Chinese companies. The Indian Embassy in China issued advisory for Indian companies, in case of large transactions.
In a statement, the Indian Embassy in China stated, "Annexure 1 contains a list of typical problems that Indian companies face. It also contains a checklist of precautions that Indian companies are advised to take while dealing with Chinese entities. Annexure 2 contains descriptive accounts of the typical modus operandi adopted by offending Chinese entities. Annexure 3 contains a list of Chinese entities involved in trade disputes with Indian companies from 2009 to April 2024."
"It is highly recommended that before doing business with any Chinese entity, Indian companies write to the Indian Embassy (com.beijing@mea.gov.in, ccom.beijing@mea.gov.in) or Indian Consulates at Shanghai (hoc.shanghai@mea.gov.in), Guangzhou (com.guangzhou@mea.gov.in) and Hong Kong (commerce.hongkong@mea.gov.in) to verify the credentials of the entity. The respective Mission will respond in 4-5 working days," it added.
It advised Indian firms that before doing any business with Chinese companies must collect and retain copies of the resident identity card (Chinese identity number) and passport of the proprietor and other responsible interlocutor(s) of the Chinese entity.
In a statement, the Indian Embassy in China stated, "In case of large transactions, it is highly recommended that Indian companies may consult a Business Service Company which can provide a report on the business transparency, financial health, reputation, reliability and credentials of the Chinese entity."
"It is highly recommended that before doing business with any Chinese entity, Indian companies collect and retain the copies of both the Resident Identity Card (Chinese Identity Number) and Passport of the proprietor and other responsible interlocutor(s) of the Chinese entity," it added.
Urging Indian firms to take extra precautions, the embassy said, "The Embassy has observed that the majority of the trade dispute cases involve companies registered in Shandong, Hebei, Guangdong, Jiangsu and Zhejiang provinces. Therefore, Indian companies are advised to take extra precautions before trading with companies from these provinces."
