Indian Companies Operating In China To Ramp Up Investments In 2019: CII Survey

Most Indian companies present in China are planning to continue to invest in China in 2019, according to a new survey by Confederation of Indian Industry (CII) and Evalueserve. This is the second such survey of Indian companies undertaken. The survey of Indian companies working in China shows cautious optimism and confidence as compared to the previous survey last year. Most companies do not see significant impact of the current trade situation between the US and China on their business, said Mr Chandrajit Banerjee, Director General, CII.

The survey, Business Climate for Indian Companies in China, drew responses from 57 Indian companies in China. As per the survey, 98% of the respondents plan to make some investments in China in 2019 with two-fifths considering ramping up their investments over 2018. More IT and BPO companies plan to make additional investments in 2019 compared to 2018.

Two thirds of the companies said that their business was very profitable or profitable in 2018, with higher EBIT than in 2017. Of the surveyed companies, 30% generated revenues higher than CNY 100 million from China in 2018 and four of five respondents stated that their revenues in 2018 were higher than in the previous year. The largest proportion, 72%, of Indian companies are invested in Shanghai, the most popular destination. 72% of the respondents have up to 50 employees and hire more than half the workforce locally, according to the report.

Among the challenges, while half the companies felt China's innovation is more favourable than the worldwide average, rising labour cost, finding and retaining talent and stricter regulations were the top cited issues. Quality of products and Services continues to be a key success factor in China. 74% of the companies said that trade friction involving China and the US has had no impact on their business.

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