~ by Charmaine Mirza

India Inc. is reeling in the wake of the recent dismissal of Cyrus Mistry’s dismissal as CEO of Tata Sons, the promoter company of the Tata Group. The subsequent fracas between Ratan Tata and Cyrus Mistry that has ensued has raised many questions (and eyebrows). But the question that Inchin Closer is asking is if this will have an impact on the Tata Group’s interests in China. If so, which way will the balance tilt?

• Cyrus Mistry was bullish on China as a market for future growth.
• But the fact remains that the initial roots for the Tata companies’ businesses in China were already sown prior to him taking over.
• There were also strategic alliances between the Tata Group and some provinces in China who foundations had already been laid under Ratan Tata’s stewardship.

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India and China’s swelling middle class is what advertisers, marketers and investors have counted on for a bigger return on investment, higher profits and soaring sales.  Its her growing population with a rising income, fattening consumption levels and ballooning aspirations that have lead companies to the hungry navel of the sweet and sour neighbours.

Yet, a recent PEW study shows that while both China and India have succeeded in pulling 356 million Chinese and 133 million Indians out of poverty between 2001 and 1011, China has managed to move a majority up the value scale – from poor to middle income. Whereas, India has just about managed to make her poor join the leagues of low income people, keeping their standard of living, access of opportunities and consumption rates dismally low at current purchasing power parity.

This means that while China was able to increase the standard of living of her people dramatically, India only marginally managed to improve the lives of her people. The lost opportunity, takes significantly away from India’s demographic dividend which investors have been counting on to spur sales. Analysts pose the consequences to India’s slow governance, corruption and general apathy. Economically, it means that while China’s population will be older than India’s by 2010, it will also be much richer as a whole, leaving people happier and companies richer.

According to the report, from 2001 to 2011, the poverty rate in China fell from 41 percent to 12 percent and the poverty rate in India dropped from 35 percent to 20 percent.

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All of a sudden, there is a flurry within Chinese business and diplomatic circles present in India. Nike Air Max 90 Hyperfuse Heren A sense of urgency prevails, to get things moving, paperwork pushed and machines brought in, companies established and capital pumped in, associations formed and collaborations sealed. Nike Air Max 90 Honeycomb Dame The Chinese within India have jumped into action and want things done in double time. They finally want to see results. Nike Air Max 90 BR Heren As India’s new Prime Minister gets sworn in today, many Chinese companies are going all guns to make their mark on the Indian subcontinent. Nike Air Max 90 Dames Chinese companies who have up until now sat quietly on the sidelines speculating about where to invest are now swooping into the country to strike it rich. As China’s GDP falls from her supersonic highs, and the economy stagnates as inflation balloons, Chinese companies are looking beyond their comfort zone of South East Asia – which they’ve already explored and are now bolstered with cash to invest further afar. India is a prime target and Chinese companies already in India have crunched their numbers long before Modi said – I do. Air Max Tailwind 7 Goedkoop Read more

As China and India play tug-of war in re-balancing their economies, Inchin Closer takes a look at the real growth engines in both countries — India’s Middle class and China’s Rural mass.

Birds of Gold as dubbed by the Mckinsey Global Institute, for their ability to sway consumer companies, public opinion and pull the weight of the economy simultaneously, the bulk of our populations, do not only dictate domestic decrees but also international tet-a-te’s. While India’s middle class, also sways political opinion, China’s rural junta doesn’t have this privilege. Yet, this is where the real markets lie, the untapped potential that producers churn factories for and investors pump in money for in the hope that one day, these masses will will reap them rich dividends.

An ambiguous title, India’s middle class is one that is defined on an income parameter which varies depending on which economic group you talk to, similarly, China’s rural masses too vary depending on which social analyst you speak with. Here at Inchin Closer we will look at their economic impact depending on their psychological position of being our real growth engines.

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Chinese companies in India’s financial hub of Mumbai are gradually coming together to form what will be an Association of Chinese Companies. Similar to New Delhi’s Chindia Chamber of Commerce and Industry, which represents over 110 Chinese firms in India, the association will lobby for common rights within India, will cooperate with Indian associations and will share best practices honed from across sectors, over years. Reflecting the Indian Association in Shanghai, a group of like minded individuals and companies who gather for business and social events, in China’s financial capital, the Chinese associations are only open to membership by Chinese companies.

In developing economies where freight is fraught and torrid trade disputes stretch on tirelessly, it becomes important for companies from one nation to club together to understand their host nation better and gain a sense of brotherhood in an alien land. While our bilateral trade might be Inchin towards the US$100 billion mark sooner than expected, there is yet so much we need to understand about each other. Our governments might shake hands in the capital and yet point the barrel of a gun on our borders. Our markets are keen to explode into each other, take advantage of our synergies and make the most of our billion plus populations, yet creating a body of commonness is key.

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