For many years, Investment from China was only 0.47% ($1.2 billion) of the total FDI inflow in India between the years 2000-2015. The investment flow from China remained a hostage to the security concerns though it was one of the India’s largest trading partners in 2008 surpassing the US.
However, looking at the recent announcements, there is a complete overhaul in this situation. Wanda, the largest commercial real estate developers in China, announced $10 billion worth investment in Haryana. The largest carmaker in China, SAIC Motor, has proposed to purchase the GM’s Gujarat facility. Around 100 SME’s in China have pledged investments worth $1 billion.
At the start of the New Year, Ctrip, China’s online travel company took a strategic stake in Baidu and Makemytrip, also unveiling their talks with several India start-ups for funding.
Frank Hancock, the managing director at Barclays said that the Chinese internet companies have acknowledged the high potential the digital start-ups in India has and there is quite likeness in the experiences and learning curves.
China’s investment in India is estimated to be $5 – $10 billion in 2015-2018. From 1st January 2015 to 22nd January 2016, Asian investors shortlisted 48 Indian start-ups to provide financial support. 22 companies from countries that include South Korea, Japan, Taiwan, Singapore, Malaysia, and China partook in the round of funding of $3.4 billion worth during this time. The major Chinese investors include Alibaba, Wanda, Baidu, SAIC, Tencent Holdings and SAFE.