China-India Business Update: Jun. 29

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Jun. 29 – Welcome to our biweekly China-India round up in which we examine the latest bilateral news and commentary affecting foreign investment in the two countries.

Population Forecast: India to Overtake China by 2025
India will overtake China as the world’s most populous nation by 2025 and the combined populations of the two countries will reach nearly 3 billion by 2050, according to projections released by the U.S. Census Bureau earlier this week.

The bureau’s forecasts suggest that India will add some 467 million people to its population over the next 39 years, much more than any other nation. China, meanwhile, is expected to see its total population drop by 33 million.

AirAsia Eyes Indian and Chinese Markets
Asia’s largest low-cost airline, the Malaysian-based AirAsia Berhad is looking to develop more routes to India and China, seeing the opportunities generated from the increasing demand from those fast-growing countries. Its expansion plan in India may bring more competition to IndiGo, India’s domestic airline that operates under a similar low-cost model and currently boasts routes to 25 destinations in the country.

India Sees FDI Increase 43 Percent in April
Indian foreign direct investment in April grew at a rate of 43 percent year-on-year, up from US$2.17 billion in 2010 to US$3.12 billion this year.

China and India Resume Military Exchanges
An eight-member Indian military delegation began a six-day visit to China on June 19, marking the resumption of the two countries’ military exchanges which were suspended for almost a year due to a visa dispute.

Fast Track Exit Mode Guidelines for Defunct Companies in India
Offering the Fast Track Exit mode guiding principles for defunct companies in India under section 560 of the Companies Act, 1956.

Employers in India to Have Compulsory Insurance for Overseas Workers
From August 1, 2011 all South Korean companies hiring overseas labor-intensive workers will be required from later this year to give to the departure expiration insurance to pay their retirement benefits.

In a statement issued by India’s Labor Ministry, the revised enforcement ordinance to the law on the employment of foreign workers is set to go into effect on August 1 as no parliamentary consent is necessary.

Bribe Confession Web Sites Emerge in China, Imitate India
Learning from the concept of India’s, a web site that encourages people to relate stories of bribery in its discussion forums, several similar bribe-reporting web sites have also emerged lately in China and are attracting a myriad of visitors just days after opening. However, many visitors and story posters worry that without obtaining the government’s support, the web sites cannot last long under China’s powerful internet censorship system.

Verifying the Accuracy of TDS Certificates in India
India’s National Securities Depository Ltd. (NSDL) has now begun an online service whereby any deductee can verify the accuracy of the TDS Certificate (Form 16A) issued by the deductor.

IEA Looks for Chinese, Indian Support in Release of Oil Reserves
The International Energy Agency (IEA) said it had consulted Saudi Arabia, China and India before it made the decision to release 60 million barrels of oil reserves in the coming month. It has also invited China – the world’s second-largest oil consumer – to join the IEA and contribute, together with other member countries, to stabilizing global oil prices.

SCO Astana Summit Seeks Further Security and Economic Cooperation
Member country leaders of the Shanghai Cooperation Organization gathered at a summit yesterday in Kazakhstan’s capital Astana to celebrate their past achievements and to direct their future cooperation.

Dezan Shira & Associates provide foreign direct investment advice and services to clients in both China and India. The firm provides due diligence, incorporation, tax, accounting and other business services from ten China offices and five in India. Please contact the practice at or as appropriate, visit the firm’s web site here, or download the firm’s brochure here.

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