The Indian Embassy in China has revised the trade advisory for Indian small and medium enterprises (SMEs) engaging in or planning to engage in business with Chinese companies. The advisory urges Indian businesses to heed the guidance and annexure documents and to exercise due caution when interacting with Chinese entities.
In a release, the Indian Embassy in China noted, “The Embassy has consistently encountered various issues that Indian companies face while transacting with Chinese entities in China. Indian companies are encouraged to pay attention to this advisory and its accompanying documents and to take appropriate precautions when dealing with Chinese entities.”
Indian companies are recommended to consult with the Indian Embassy prior to engaging in business with Chinese firms, especially for significant transactions.
The statement from the Indian Embassy in China detailed, “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.”
The advisory strongly suggests that “before initiating business with any Chinese entity, Indian companies should reach out to the Indian Embassy (com.beijing@mea.gov.in, ccom.beijing@mea.gov.in) or the Indian Consulates in Shanghai (hoc.shanghai@mea.gov.in), Guangzhou (com.guangzhou@mea.gov.in), and Hong Kong (commerce.hongkong@mea.gov.in) to confirm the entity’s credentials. The respective Mission will revert within 4-5 working days.”
The Indian Embassy in China has issued a statement saying, “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.”
Furthermore, the embassy emphasized, “Before conducting business with any Chinese entity, it is highly recommended for Indian companies to collect and keep copies of both the Resident Identity Card (Chinese Identity Number) and Passport of the owner and other responsible representatives of the Chinese entity.”
Highlighting the need for vigilance, the embassy advised Indian firms, “The Embassy has noted that a majority of trade disputes involve companies registered in the provinces of Shandong, Hebei, Guangdong, Jiangsu, and Zhejiang. Consequently, Indian companies are advised to exercise additional caution when dealing with companies from these regions.”
