India china april -2012

www.icec-council.org

Vol 1, Issue 2, April 2012

EDITOR-IN-CHIEFMohammed Saqib

EDITORPrashun Bhaumik

EDITORIAL BOARDAbid Hussain

Mani Shankar AiyarP.S. DeodharDilip Cherian

Amir Ullah KhanParama Sinha Palit

Chen Si (China)

EDITORIAL TEAMAnchit GoelIrfan AlamManju Hara

Sumelika BhattacharyyaShawahiq Siddiqui

DESIGNSita Raikwar

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Bottoms Up!For 17 years, o�cials from nearly 200 countries have gathered under

the auspices of the United Nations to try to deal with one of the most vexing questions of our era – how to slow the heating of the planet.

Every year they leave a trail of disillusion and discontent, particularly among the poorest nations and those most vulnerable to rising seas and spreading deserts. Every year they fail to signi�cantly advance their own stated goal of keeping the average global temperature from rising more than 2 degrees Celsius, or about 3.6 degrees Fahrenheit, above preindustrial levels.

�ere is no denying the dedication and stamina of the environment ministers and climate diplomats who conduct these talks. But maybe the task is too tall. �e issues on the table are far broader than atmospheric carbon levels or forestry practices or how to devise a fund to compensate those most a�ected by global warming.

What really is at play here are politics on the broadest scale, the relations among Europe, the United States, Canada, Japan and three rapidly rising economic powers, China, India and Brazil. �ose international relations, in turn, are driven by each country’s domestic politics and the strains the global �nancial crisis has put on all of them. And the question of “climate equity” – the obligations of rich nations to help poor countries cope with a problem they had no part in creating – is more than an “environmental” issue.

E�ectively addressing climate change will require over the coming decades a fundamental remaking of energy production, transportation and agriculture around the world – the sinews of modern life. It is simply too big a job for the men and women who have gathered for these talks under the United Nations Framework Convention on Climate Change, the 1992 treaty that began this grinding process.

�e United States is determined to sweep away those distinctions and work toward a system where all countries are bound by the same rules. �e conference in Durban kept the tiered system alive for another few years, but it is fading. And by the time the next phase of the Kyoto Protocol expires in 2020, a good many leaders hope that it will be gone for good.

So who is quali�ed to tackle these tasks? Two years ago, more than 100 heads of state and leaders of governments, including President Obama, joined the United Nations climate conference in Copenhagen hoping to write a new, legally binding treaty covering all parties. �at assignment proved too much even for the leaders, and the meeting collapsed in acrimony and �nger-pointing. Few top leaders have shown up at the two subsequent meetings, in Cancún, Mexico, in 2010 and in Durban last year. �e agenda has narrowed and expectations have shrunk, yet the ship sails grimly on. And as one observer at Durban put it: “Instead of waiting for them to negotiate some grand bargain, we have to keep working on the ground. Progress is going to come from the bottom up, not the top down. �at’s just reality.”The information contained in this

magazine has been reviewed for accuracy and is deemed reliable but

is not necessarily complete or guaranteed by the Editor. The views

expressed in this digest are solely that of the writers and do not necessarily

reflect the views of the magazine.

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April 2012 India-China Chronicle |3|

ENVIRONMENTAL CONSULTANCY IN INDIA

20 Open Sesame �e scope for environment

consultancy is opening up in India what with more and more businesses realizing the importance of doing ecologically sound business.

30 Rolling the ball in Durban

�e Durban conference’s greatest achievement was acknowledging the fact that current policies were not enough and that it was time for a change in how we viewed climate change and green energy.

MANAGEMENT & DELIVERY OF WATER SERVICES

32 Our Water Our Life �e key to successful community

participation in water supply management is to make the community understand the value of water resources and invite them to participate in managing the scarce resource.

DOING BUSINESS IN CHINA

36 �e First Step China is not the easiest places to do

business in. A guide to overcome hurdles across the Great Wall.

INTERVIEW

38 China market is not a cash cow

Ravi Shankar Bose is the Director of Fugumobile Ltd, a successful Shanghai based company started by Indians. He speaks with Anchit Goel about his experiences in China.

CHINA-INDIA AS TRANSFORMATIVE FORCE

41 �e Brave New G2 World

While most people are looking for a US-China G2 along the lines of the old school, the most important G2 could be that of China and India. We should see these two in a relationship that is mutually bene�cial.

INDIA-CHINA RELATIONS STRATEGIC

44 Linked like two wings of a bird India and China will be able to

successfully face the challenges that the new geopolitics are throwing up and would best serve their own national interests by further deepening their strategic cooperative relationship.

MUST SHED HISTORICAL BURDEN, MUST COOPERATE

48 No force in the world can stop China, India from rising together

REPUBLIC DAY & CHINESE NEW YEAR

54 Ringing in the New It was a unique celebration – the

combining of two joyous occasions �nding expression in one.

56 Exhibitions & Trade Show

TOURISM

58 10 places to see in China that aren’t the Great Wall

Glacier lakes, mountain forests, sandy beaches and more. Here’s a list of some dramatic destinations that you may not have yet considered for your trip to China

FILM REVIEW

62 �e Flowers of War

BEYOND THE GREAT WALL

64 Have a dragon year!

|2| India-China Chronicle April 2012

CONTENTSCONTENTS

Climate change is a matter of justice. �e richest countries caused the problem, but it is the world’s poorest who are already su�ering from its e�ects. In Durban, the international community should have committed to righting that wrong. But instead it got caught with semantics.

24

4 Feedback

INTERVIEW

6 We are all equally vulnerable

RR Rashmi is the Joint Secretary in the Ministry of Environment and Forests, Government of India and works on issues of climate change. Here he speaks with Shawahiq Siddiqui on a range of issues on climate change and India’s position in the global arena.

POLITICS OF CLIMATE

10 Two Degrees of Separation

Climate change is a double whammy for developing and poor countries as they are brought to the brink of global tipping point largely by indiscriminate historical and current emissions of the rich, industrialized and developed world. And now they are being pushed by global climate politics which is solely dictated by safeguarding self interests to pay for the sins not committed by them.

INTERVIEW

16 Need to make consumers aware of energy e�ciency

Irfan Alam spoke with Abha Shukla, Secretary, BEE on the bureau’s journey so far.

COVER STORY

Caught in semantics

DEVELOPED & DEVELOPING WORLDS


New ChapterNeed to Democratize Small

Businesses by Zhang Weixin, was an interesting article to read about the small private businesses in China. �ough they have played a major part in improving the country’s overall economy and have played a major role in providing employment and services, they are still lagging behind. �e problems are well understood, like the quality of produced good, management and many other factors which China needs to overcome in order to reach new heights in the global arena. It was a good article with many insights into the problems of the small business speci�c to China. Congratulations to ICEC for the opening of a new chapter in Ahmedabad. �is new chapter will help take India-China relations to a new level. Interaction of personnel from di�erent sectors on the same platform between two countries will surely help and improve relations in trade and allow for more cultural interactions in the coming years.

– Raj Bora, Vice President IFFCO-TOKIO General Insurance

Going Green�e article—Going Green now to

avoid Going Red later—in the last edi-tion of the India-China Chronicle made for a very interesting read. �e SME sector comprises a large portion of economic activity globally, thus

F E E D B A C K

making them highly energy intensive. It is quite disconcerting to �nd out how this sector has not been made aware of the high carbon emitting potential it can have and the policies related to it.

Mr Shawahiq’s article was a well re-searched and a descriptive note on how these enterprises can aim at reducing their carbon emissions and the legisla-tion and regulatory framework that is available. It is also remarkable to note how SMEs can view climate change policies as opportunities for accessing technology and �nance. I am sure that if there are provisions and innovations in other countries that have helped SME’s reduce their carbon footprint, India should adopt these at the earliest too.

– Shilpa Chohan, Advocate Delhi High Court

MSME ImpactMSMEs can have a much wid-

er reach and impact on the society. MSMEs which account for the second largest source of employment should be the target area to improve the eco-system and conserve the environment. �erefore, it is very important that the MSMEs should adopt CSR activities for its sustainable future. SIDBI is do-ing a very good job by �nancing small and medium enterprises for sustainable

development. However, more initia-tives, awareness programmes and pro-motional activities should be carried out in order to build a sense of respon-sibility among the MSMEs. Setting up of institutions for green �nancing will be an e�ective method for sustainable development.

– Vishal Acharya, Assistant General Manager, Cluster Pulse

Nerves of Steel�e last issue of the India-China

Chronicle has been able to give us an in-sight into how the industries in China have grown so rapidly over the last few years. I especially like the article China’s nerves of steel which gave a deep insight into the present day scenario of the in-dustrial boom in China and how it is looking to transform itself from a coun-try which is looked at as a manufacturer of the world to a country which is fast becoming the new innovators of the world. �e Chinese have been able to tap the potential of their skilled man-power and develop many joint ventures that have helped the Chinese to learn about the technologies of the world. Even though India is only second to China when it comes to the growth rate but we still have a long way to go before we can catch up with China. We should look at strengthening our own R&D sector and learn to develop our own indigenous technologies.

– Saloni Jha Mishra, Assistant Director, FICCI

Love LostIssues related to women have always

been there in every society. Women not only have passed through some of the most terrible times but also have also been exploited. �e article

by Manju Hara, Love Must Not Be Forgotten de�nitely gives readers an insight into Chinese society, and the status of women in China. �e result of several inequalities over

centuries on di�erent grounds has pro-voked many women writers to show-case the emerging image of women in China. �e writer has pointed out a few of the interesting novels which are worth a read

– Shallu Khetan, Student, IP University


THE PAST CANNOT BE IGNORED; THE DEVELOPED COUNTRIES WHICH HAVE THE RESOURCE

MUST BE WILLING TO INVEST IN A RATIONAL WAY AND SHOULD IMPLEMENT WHAT THEY HAVE COMMITTED (TO REDUCE THEIR

EMISSIONS) AND THIS IS THE REAL CHALLENGE

ICC: There have been many versions about the role that India played at Durban. What actually transpired?

Rashmi: Before Durban, with my little understanding, India had lots of hope to stir the process itself on behalf of developing countries. In Durban the major role was to save the Kyoto Pro-tocol. In fact, it was the Environment Minister from India who played a piv-otal role in foraging a consensus. �e talks would have completely collapsed without her. We were heading nowhere and EU was not willing to move further on the Kyoto Protocol unless they were assured of some road maps beyond 2020. So, we �nally broke the impasse with an understanding that there will no be agreement on the legal forms of the �nal outcome, whether it is bind-ing or non-binding, legal or in some other form, that issue will be revisited as we proceed along with the negotia-tions. �at was the fundamental issue in Durban.

Did India play a leadership role for developing countries?

We have been able to safeguard the fundamental interest of developing countries by ensuring that there is no commitment to reduce the emissions till 2020. And also, beyond 2020 we have ensured that the new arrange-ments that are going to evolve will be under the Convention (UNFCCC). Now if one is familiar with the conven-tion, the fundamental issue is that the countries must take action according to their responsibility. �ere is a prin-ciple of common but di�erentiated responsibility and the principal of eq-uity. So, the arrangements that evolve post 2020 period will have to be con-structed according to these principles. In a way these two are the major gains of the Durban conference. From our perspective, we have been able to bring the Kyoto Protocol back on track and established the second commitment period without any legal obligation for any developing countries.

One way to look at it could be that the commitment to emis-sion reduction that was to come within the period of 2020

has been stretched beyond. Did we delay the final outcome by postponing it to 2020?

It is a mistake to presume that cli-mate change takes place because of cur-rent emissions. Climate change does not take place or has taken place be-cause of the emissions that took place in the last 10 years, or will take place in the next 50 years. Climate change is entirely an environment phenomenon which is attributed in totality to the emissions by the developed countries in the past 150 years.

In short the point is we are not saying that we should be shy of our ambitious actions, rather we

should contribute to expect the best possible results. All countries must contribute in a reasonable way to the principal of common but di�erentiated responsibilities.

But the past cannot be ignored; the developed countries which have the resource must be willing to invest in a rational way and should imple-ment what they have committed (to reduce their emissions) and this is the real challenge.

�e Kyoto Protocol is a protocol which mandates one to reduce the emissions, and except a few countries, no other countries have actually reduced its emission which is a complete travesty of the Kyoto Protocol. Countries with emerging economies like India, China, South Africa, Brazil, are part of it and that is what matters and they are doing everything which is possible within their given limited resource. Domestically we have taken a number of actions; we have our National Action Plan on Climate Change. Along with that, we are doing so many things in di�erent sectors and are an example for others. In fact, there are several international studies that have highlighted the Indian policy e�orts on climate change and have concluded that our national voluntary action and its impact are more signi�cant than

|6| India-China Chronicle March 2012

INFOCUS | INDIA-CHINA | INTERVIEW

RR Rashmi is the Joint Secretary in the Ministry of Environment and Forests, Government of India and works on issues of climate change. Rashmi belongs to the 1983 batch of the Indian Administrative Service (IAS). He has been dealing with Climate Change matters as Joint Secretary, Ministry of Environment and Forests, Government of India for the last eight months. He has participated in several important bilateral and multilateral negotiations on behalf of India. In his career spanning more than 25 years, he has acted as trade negotiator on behalf of India. Here he speaks with Shawahiq Siddiqui on a range of issues on climate change and India’s position in the global arena.

We are all equally vulnerable


(consuming more than 20 tonnes/year of carbon). �erefore an inequality issue like this has to be addressed.

Do you think that the coordination and reporting machinery among the various ministries and the Ministry of Environment and Forest are lacking in any way?

It is not fully correct that there is no coordination, there is a coordina-tion mechanism functioning in this ministry and we have a dedicated co-ordination committee in the ministry (MOEF). Several inter ministry meet-ing of all the ministries in-charge of the di�erent environmental missions and action plans of the government are conducted by the committee. Here the progress (of various ministries) is seen and the possible outcomes are then determined and the future actions are coordinated accordingly.

Let me put it in perspective, there are two aspects where one might feel that the coordination mechanism needs to be further strengthened; legal and developmental. For instance, in our country climate change is seen by us (MOEF) as a nodal ministry but it is not only an environment issue, but also a social and developmental issue. And development and social aspects of the issue are not handled by Ministry of Environment and Forest, but by the respective ministries. And we should not go over their role in these matters

as there exist no environment law that says it is our job to lay down the targets for each ministry.

Do we have a mechanism where we create a different institution in a ministry and put forward various questions and challenges to another ministry?

Even in Parliament it happens that one ministry answers on behalf of the entire government. So it’s not one min-istry’s responsibility, it’s the Central government’s. If there are bottlenecks those have to be resolved. It is an ad-ministrative issue.

THE PRESENT NEGOTIATIONS ARE MORE ON POLITICAL AND ECONOMICAL ISSUES RATHER

THAN BEING ENVIRONMENTAL IN NATURE. AND EVERY

ATTEMPT IS BEING MADE TO DIVIDE COUNTRIES,

PARTICULARLY THOSE WHO ARE IN THE DEVELOPING

WORLD. WE ARE ALL EQUALLY VULNERABLE

India and China are bilaterally related countries on climate change and environment. Is there a possibility of an exchange of idea especially in the technology sector?

We have a MoU with China on cli-mate change, under which we have had two workshops. First, it was exchange of ideas on the national action plan and the second, was an exchange on water and mountain ecosystems (Himalayas Eco-system Mission). And we are planning to hold a third one in the near future.

Is there anything else that we can gain from China?

We can learn from China in terms of market mechanism; as to what kind of strategy China is employing to decrease its Carbon-dioxide intensity. Which maybe in terms of law on carbon or any other strategy; such an exchange of idea would be bene�cial to both countries.

We have a huge amount trade from China, is it environmen-tally safe? As we have to deal with the disposal issues of the goods that are imported and that impinges a cost on us.

We would not like to bring in the linkage between environmental challenges and trade either in context of China or any other country as it is in the interest of environment as well as trade.


the developed countries. But this does not mean that we should take a legally binding commitment even before 2020 or before the developed countries have made their commitments as we are the ones who are a�ected most by climate change and our interest should be seen by the global communities before anyone else.

The Least Developed Coun-tries (LDC) and island nations feel that India is not in a posi-tion to lead them due to its alliance with the BASIC coun-tries. Do you think India is going to be looked upon as a leader for other countries?

I think this classi�cation of coun-tries is not motivated by very noble reasons. �e present negotiations are more on political and economical is-sues rather than being environmental in nature. And every attempt is be-ing made to divide coun-tries, particularly those who are in the developing world. We are all equally vulnerable. For instance if the small island develop-ing countries are going to go under water in 20-50 years, so are a large num-ber of coastal communities in India. �is makes us all the more conscious of our responsibility. And instead of quarreling among ourselves we should remain united and put pressure on the developed countries to meet their commitments. On the other hand, the developed countries are trying to cre-ate a notion that the �nal agreement is legally binding in nature. So, the so-lution for this lies in actions taken by the developed countries to meet their responsibility and thereby allowing the developing countries to take action within the reach of their resources.

No developing country is running away from its responsibility. �e prob-lem is that of lack of con�dence which has been created because of most of the obligations under the convention have not been ful�lled. And the basic reason for non ful�llment of goals is lack of funds and technology. Even in terms of

coal, the most dominant source of en-ergy today, the clean coal technology and the coal gassi�cation technology are not available commercially. And the super critical technology and the ultra super critical technology require large investments for implementation and there is no global mechanism for their funding and implementation.

When it comes to India, we are certainly not demanding money, but ample resources and technologies to use e�ciently.

In Durban it was hoped that India would be closer to the EU stand but ultimately the EU and the US came together, and India was standing alone in terms of the statement. Is this in the right spirit?

I don’t think it happens by de-sign; it so happens that the fundamen-tal interest of USA and EU are same -- �ey are both a part of the developed world, both of them would not like to meet the obligation, both of them would not like to discharge their his-torical responsibility. But EU has been traditionally more environment con-scious, since they are the one who actu-ally piloted the initial discussions (on climate change). But as far as the Dur-ban outcomes are concerned, I would say that India was against the EU and in fact it was the only country which was against the EU for a legally binding agreement. And �nally it was a mutual dialogue between India and EU which resolved the issue, so I would certainly not agree with the view that we were together with the EU.

�e EU was trying to force a deci-

sion on something which was not re-quired in Durban. What they should have done is that, they should have agreed to the second commitment pe-riod of Kyoto Protocol as required un-der the obligations of the convention.

Does the Kyoto Protocol stop here and make way for a new regime that the world would want to come up with?

No, the Kyoto Protocol does not stop here because the second commit-ment period decision has been taken. So till 2017 or 2020 depending on the �nal negotiation, the Kyoto Protocol will continue to exist.

In case we come up with this soft agreement, are we in a

position to commit to bring down our emission?

�e requirements of compliance don’t state that we should bring down our emissions. India has made it very clear that we would not bring down our own emissions in the near fu-ture because it is our de-velopment requirement and our emissions are bound to rise. But we will be able to bring down the

emission intensity of our GDP and that is not only required for the purpose of addressing climate change and but also for the energy security of our country, as our energy resources are limited and they are required to be used in an ef-�cient way. And to add to that, we have certainly made progress in a direction where we use less energy for producing the same amount of goods by mainly improving our technology but we can-not say that we will use absolutely less energy than required as it is simply not possible given that we are a huge popu-lation with huge energy needs.

We also face a lot of challenges mainly due to our growth; 50% of our population still does not have com-mercial electricity. And a government would not like its people to live in pov-erty and without basic needs when the developed part of the world is ful�lling its needs at the cost of natural resources


Archana Vaidya

Climate Politics has yet another time not let the science dictate the quantum of action, in terms

of emission reduction needed from the rich developed world. It is extremely unfortunate that despite scienti�c evidence and the fact that the inter-national community knows the solu-tions there is little ‘real progress’ in the UN climate talks regarding the man-ner in which these objectives are to be achieved. In the words of Michael Jacobs, visiting professor at the Gran-tham Research Institute on Climate Change and the Environment in Lon-don, the Durban agreement has not in itself taken us o� the 4C path we are on but by forcing countries for the �rst time to admit that their current policies are inadequate and must be strengthened by 2015, it has snatched 2C from the jaws of impossibility.

Current emission trends, cost of adaptation, mitigation

�e Climate Action Tracker es-timates that global mean warming would reach about 3.5°C by 2100 with the current reduction proposals on the table. Approximate estimates indicate that the most extreme costs will be felt in West Africa and South Asia, with residual damage of 3.5% of regional GDP for 2°C warming and 5-6% for 3°C warming. �ere are still no new pledges on the table and the process agreed in Durban towards raising the ambition and increasing emission re-ductions is uncertain in its outcome. Unfortunately only rich countries have the wherewithal in terms of resources both �nancial and technological to help developing countries deal with and meet the expense of adaptation and mitigation. �e costs for adapta-tion and the residual damages from cli-mate change will increase rapidly with warming. With a 2°C warming, adap-tation costs would be half those associ-ated with a 3°C temperature rise.

‘Collective but differentiated responsibility’ does not warrant unequals to be treated equally

�ere is no denying the fact that his-torical as well as current polluters will

THE DURBAN AGREEMENT HAS NOT IN ITSELF TAKEN US OFF THE 4C PATH WE ARE ON BUT BY FORCING COUNTRIES FOR

THE FIRST TIME TO ADMIT THAT THEIR CURRENT POLICIES ARE

INADEQUATE AND MUST BE STRENGTHENED BY 2015, IT

HAS SNATCHED 2C FROM THE JAWS OF IMPOSSIBILITY

have to cut down emission signi�cantly if we are serious about keeping the rise in global average temperatures since pre-industrial times below 2C (3.6F), the internationally-agreed threshold. �e basic premise of UNFCCC is “collective but di�erentiated responsi-bility” thereby allowing scope for dif-ferent mitigation responsibility for dif-ferent countries depending upon where a particular country is at this point in time in its journey towards develop-ment. How do we expect countries with di�erent level of development, having huge di�erence in per capita green house gas emission, and di�erent �nancial resources thus di�erent capa-

bilities to have same responsibility and to be governed by the same rigours of legally binding emission reduction re-gime? �e fact of ‘ecological debt’ that a country has incurred, due to histori-cal emissions and thereby having taken much bigger ecological space than it is entitled to, will have to be kept in mind while deciding legal obligations of these countries.

Climate change is a global problem and has only global solutions but un-fortunately it does have local impacts. How well prepared one is to adapt and to mitigate the ill e�ects of rising atmospheric temperature is directly proportional to one’s �nancial muscles. It is a double whammy for developing and poor countries as they are brought to the brink of global tipping point largely by indiscriminate historical and current emissions of rich, industrial-ized and developed world, and now they are being pushed by global cli-mate politics which is solely dictated by safeguarding self interests, to pay for the sins not committed by them. De-veloping countries and the least devel-oped countries still have a long way to go and it would de�nitely not be in the interest of equity, fair play and justice to have restrictions imposed in their path and curb their ‘right to develop-ment’ because someone else has already occupied the ecological space that was rightfully theirs. �e developed world

April 2012 India-China Chronicle |11||10| India-China Chronicle March 2012

INFOCUS | CHINA-INDIA IT SECTOR | REPORTINFOCUS | CHINA-INDIA IT SECTOR | REPORT

Climate change is a double whammy for developing and poor countries as they are brought to the brink of global tipping point largely by indiscriminate historical and current emissions of the rich, industrialized and developed world. And now they are being pushed by global climate politics which is solely dictated by safeguarding self interests to pay for the sins not committed by them.

POLITICS OF CLIMATE

Two Degrees of Separation

help developing countries adapt or adjust to the e�ects of climate change) and “mitigation” (money needed by developing countries to eliminate or signi�cantly reduce greenhouse gasses). �erefore the two top big political issues at Dur-ban were to ensure operationalisation of the Green Climate Fund (GCF), and to have post-2012 arrangements in place apart from many practical de-cisions that needed to be taken.

As a long shot, delegates in Dur-ban could also agree to a global target for GHG emissions for 2050, and a “peaking year” for global emission (by 2020 if there’s a serious chance of limit-ing warming to 2 degrees Centigrade). An ambitious scheme to protect tropi-cal forests in return for money generat-ed mostly by carbon credits could also be �nalized during Durban talks.

What did Durban deliver?Before negotiations formally start-

ed it was made clear by Japan, Russia, Canada and Australia, that they did not want a second commitment pe-riod and backed American plans for a system of “pledge and review”. �e EU and most rich countries including the US were determined to get China and developing countries to commit to deeper cuts which were being strongly opposed by more than 100 developing countries including India. Finally two weeks of hectic parleys and roughly 20,000 delegates representing diver-gent interests and views, struggling to arrive at a workable solution, �nally yielded some results. Following are the main outcomes of the Durban meet

�e delegates agreed to establish a new body called “Ad Hoc Working Group on the Durban Platform for En-hanced Action” to negotiate a global agreement which would develop a new protocol, “another legal instrument or agreed outcome” with “legal force” that will be applicable to all Parties to the UN climate convention. �is new legally binding instrument is to be de-cided by 2015 and to come into force by 2020.

�e exact nature of this “legal in-strument” or “agreed outcome” has not yet been decided. �e next three years till 2015 are crucial as during this pe-

riod country wise emission reductions will be decided based on review of the pledges of the rich nations, voluntary mitigation action of the developing world and of ��h assessment report of UN’s scienti�c body, the Intergovern-mental Panel on Climate Change.

Durban managed to extend Kyoto, whose �rst phase of emissions cuts run from 2008 to the end of 2012. �e sec-ond commitment period will run from January 1, 2013 until the end of either 2017 or 2020 as both are under consid-eration.

However in the bonhomie of this new global deal and a fresh lease of life that Kyoto got, little attention was giv-en to enhancing the current emission targets for the Annex 1 countries for the second commitment period. So a second commitment period surely has been secured but its adequacy leaves a lot to desire for. European Union, the 27-nation bloc, which already has its own internal target of lowering green-house gases by 20 per cent below 1990 levels by 2020, will place its current emission-cutting pledges inside the legally-binding Kyoto Protocol. EU is also open to raising its mitigation tar-gets to 30 per cent if other countries follow suit.

All the parties to Kyoto Protocol will submit their voluntary QELRO by 1 May 2012 in a “pledge and translate” exercise for the second commitment periods. However unlike Kyoto, these emission targets will not be derived, for now, by an overall aggregate level of ambition. Parties’ unilateral pledges will be converted to QELROs without

A MAJOR CONCERN RELATED TO THE SOURCES OF FUNDING

FOR THE GCF IS THAT IT IS PREDOMINATELY FROM

PRIVATE SOURCES THAT ARE LIKELY TO VIEW CLIMATE

CHANGE MORE AS A BUSINESS OPPORTUNITY THAN A SOCIAL

RESPONSIBILITY


wants the growth of developing world to be fettered by mandatory emission reduction regime and have succeeded to some extent as the same has been agreed upon and would be in force from the year 2020.

However having said this if there are �nances available to pursue the more capital intensive carbon benign growth path then these countries are not encumbered unnecessarily and will willingly follow the sustainable growth path. Durban has been able to extend the Kyoto Protocol beyond 2012 and it has created a fund to deal with ad-aptation and mitigation of developing countries but on both accounts a lot still needs to be done to make them deliver. We are trapped in the midst of doing too little too late.

What was expected of Durban?�e discussions at Durban was

expected to advance, in a balanced fashion, the implementation of the Convention and the Kyoto Protocol, as well as the Bali Action plan, agreed at COP 13 in 2007, and the Cancun agreements, reached at COP 16 last December. In view of the successive failure of the international community at both Copenhagen and Cancun to have any agreement on post 2012 emis-sion reduction regime, COP 17 was looked upon as the last chance before the expiration of the Kyoto Protocol to get a new agreement in place to reduce greenhouse gases emissions. COP17 was also expected to witness protract-ed negotiations to ramp up the �nan-cial resources required by developing countries for “adaptation” (money to

HOW DO WE EXPECT COUNTRIES WITH DIFFERENT

LEVEL OF DEVELOPMENT, HAVING HUGE DIFFERENCE IN

PER CAPITA GREEN HOUSE GAS EMISSION, AND DIFFERENT

FINANCIAL RESOURCES THUS DIFFERENT CAPABILITIES TO HAVE SAME RESPONSIBILITY

AND TO BE GOVERNED BY THE SAME RIGOURS OF

LEGALLY BINDING EMISSION REDUCTION REGIME?

INFOCUS | INDIA-CHINA | ENVIRONMENT | REPORT


reducing emissions from deforestation and forest degradation, paving the way for billions of dollars of private invest-ment. Details will be discussed in the course of next year and it may still take years until the programme takes o� at a big scale.

Delegates agreed to delay a decision on whether to decouple the future of JI from that of Kyoto until next year’s talks.

India’s role, stand at DurbanIndia, as a resource-rich country,

with its economy growing at a hectic pace still has to alleviate poverty for millions and at the same time deal with the consequences of climate change. �e bedrock of India’s arguments in climate change negotiations right from the beginning has been equity to en-sure that the developed world is made accountable for its historical ecologi-cal debt and developing countries like India get some window for unfettered growth without any legally binding emissions cuts. India is also acutely aware of the need to adopt the benign green growth path as far as possible for a sustainable future.

As a country therefore it had a lot at stake getting involved in these cli-mate change negotiations and along with other developing countries it had a challenging task to ensure that de-veloped countries come good on their promise for providing money to com-bat climate change. India did register a moral victory of sorts by ensuring that equity would be central for any future climate negotiations. It would not be an exaggeration to say that to ignore eq-uity in these negotiations would mean

Archana Vaidya is an advocate and managing partner in Indian Environment Law O�ces (IELO), a natural

resource management and environment law �rm based out of New Delhi, India.

signing the death warrant for millions of people across the developing and the LDC world living in subhuman condi-tions. It is a �ght between “right to life” versus “right to maintain a lifestyle” and India with the support of other de-veloping world has managed to enlarge that window for unfettered growth at least outside of mandatory emission re-duction till 2020.

COP17 has also shown the need to combine the UN approach with coun-try driven climate e�orts and the slow pace here should not be an excuse for inaction at the local level.

It is however amply clear from Durban yet another time that in this unequal world to curb emission in the coming years e�ectively will be an uphill task. India’s per capita emission even in 2030 will be less than the developed world’s average per capita green house gases emission and today also our per capita emission is half that of per capita emission of China. It would be very challenging in this scenario to ensure that principles of equity are adhered to and the target of 2oC temperature increase is anywhere within reach.

THE BEDROCK OF INDIA’S ARGUMENTS IN CLIMATE

CHANGE NEGOTIATIONS RIGHT FROM THE BEGINNING HAS

BEEN EQUITY TO ENSURE THAT THE DEVELOPED WORLD IS

MADE ACCOUNTABLE FOR ITS HISTORICAL ECOLOGICAL DEBT AND DEVELOPING COUNTRIES

LIKE INDIA GET SOME WINDOW FOR UNFETTERED GROWTH

WITHOUT ANY LEGALLY BINDING EMISSIONS CUTS

Indian Environment Minister Jayanthi Natarajan in Durban

South Africa Foreign Minister Maite Nkoana-Mashabane in Durban


reference to an overall global mitiga-tion target, not to mention one that is evidence-based.

At the request of the EU and the Al-liance of Small Island States (AOSIS), the delegates agreed to launch a work plan to identify options for closing the “ambition gap” between countries’ cur-rent emissions reduction pledges for 2020 and the goal of keeping global warming below 2 degrees Celsius. �e Durban negotiations did not manage to extend the emissions cut pledges made in both Copenhagen in 2009 and 2010 in Cancun.

�e Durban Package brings into operation new arrangements for mak-ing more transparent, the actions taken by both developed and developing countries, to address their emissions. �is is a key measure for building trust between parties.

�e Durban talks made headway on agreeing the design of Green Cli-mate Fund (GCF) to channel up to $100 billion a year by 2020 to poorer nations, but achieved little on estab-lishing where the money will come from to �ll it.

As structured, resources for the GCF will be from voluntary contribu-tions it is important that these funds come in the form of grants and not loans and these should be additional grants committed to by the developed world above and beyond o�cial de-velopment assistance (ODA). If funds were to come in the form of loans it is likely to increase the indebtedness of developing countries. Developed countries are committed to mobilise the promised funds through various

means, which include carbon trading (the real bene�ts of which to the envi-ronment are as yet unproven), private equities, and investments in cleaner development mechanisms. �us, a ma-jor concern related to the sources of funding for the GCF is that it is pre-dominately from private sources that are likely to view climate change more as a business opportunity than a social responsibility.

Another fact that makes this prom-ised amount look puny is the estimated cost given by United Nations World Economic and Social Survey in 2009, which is needed annually for adap-tation and mitigation in developing countries, is between US$500-US$600 billion.

�e Durban talks ended six years of debate over whether and how the tech-nology of carbon capture and storage could qualify for carbon o�sets under the Clean Development Mechanism. �e Kyoto scheme rewards govern-ments or companies who invest in clean energy projects in developing countries with carbon credits, which they can trade and sell for pro�t. �e new rules force project developers to put �ve per cent of the carbon credits earned in a reserve, to be awarded to them only af-ter site monitors have proved that no carbon dioxide has leaked from the un-derground store 20 years a�er the end of the crediting period.

Delegates agreed to consider private funding and market-based mechanisms as options to �nance the programme on

IT IS HOWEVER AMPLY CLEAR FROM DURBAN YET

ANOTHER TIME THAT IN THIS UNEQUAL WORLD TO CURB EMISSION IN THE COMING YEARS EFFECTIVELY WILL

BE AN UPHILL TASK. INDIA’S PER CAPITA EMISSION EVEN IN 2030 WILL BE LESS THAN THE DEVELOPED WORLD’S

AVERAGE PER CAPITA GREEN HOUSE GASES EMISSION AND TODAY ALSO OUR PER CAPITA

EMISSION IS HALF THAT OF PER CAPITA EMISSION OF CHINA

INFOCUS | INDIA-CHINA | ENVIRONMENT | REPORT



ICC: The Energy Conservation Act was introduced in 2001 and the BEE was launched in 2002. What has been the expe-rience over the last 10 years?

In the beginning initiatives were slow. Work really started in 2007 and most schemes got sanctioned in 2007-08. In the past 3-4 years we have worked in four major areas. Our focus was on demand side management and small and medium scale enterprise as well as in the agriculture sector. We have also started schemes like the Bachat Lamp Yojana (BLY), which was the part of the demand side management and we wanted to leverage the Clean Development Mechanism (CDM). We have arrived at a huge target for ourselves. �en the third was the standard and labelling scheme for application, energy consuming appliances.

For now 40 major applications are covered and out of which four ap-pliances are in the mandatory phase. �ese are PC, Distribution Transform-ers, Refrigerators and Tubelights. �en another area which we wanted to tap was the commercial building; along with commercial buildings we have also tried to look at the option of elec-tro-�tting old buildings, but our main focus remains on the new commercial buildings. �ese are the major areas where we have really focused our ef-forts. Last year we started a brand new scheme for industries. Until then we hardly had announced anyone as desig-nated consumers. Because the Energy E�ciency Act says that we can desig-nate energy consumers as designated consumers and we can put some condi-tion on them. If we designate them as designated consumers then they have to �le compulsory energy data and un-dertake energy audits.

We have identi�ed 477 major industrial units and eight major industries. Like power plants, cement, iron and steel, aluminum are all energy inclusive units. We conduct a baseline survey and accordingly we decide energy saving targets for them. �is eventually will be mandatory for all industries. Till now the targets have not been made applicable to industries and we are yet to notify those targets.

�is remains our prime concern and will be completed as soon as possible.

What is the Conservation Scenario?

�e target of 10,000 Mega-Watt in the 11th �ve year plan has almost been achieved; we have already crossed 89-90 per cent mark. It is about two months behind but we are about to achieve the planned year target. �is in nutshell is what we have achieved so far.

How does the coordination with line agencies at the state or district levels take place since there is no dedicated agency at these levels?

�e Act says that at the state level we can designate any agency which will coordinate with di�erent line agencies. And we accordingly have designated di�erent departments, some were probably state regulatory commissions and in some places energy departments were designated.

Actually they have overburdened themselves. �e Ministry of New and Renewable Energy (MNRE) has more targets with larger budgets. �ey are already overburdening with whatever the MNRE has given them. �ere are two missions under the same plan that is the enhance e�ciency plan – it is

very similar to the general SMEs and is not secondary in any way; it has to be treated equal. Because e�ciency is something which at least the domestic sector cannot regulate, you have to pro-mote it. �is is true that the approach for both things is entirely di�erent. Be-cause when we talk of new and renew-able energy we talk about the develop-ment of that area. So it is necessary to tap that energy.

But somewhere I don’t think that margin or distinction between conservation and energy has been brought about very clearly. What do you think?

I agree with you, but the point is, if a thing becomes too diversi�ed in it-self then it becomes di�cult to handle. Conservation and e�ciency are the two similar kinds of things which are equally diversi�ed in nature. Because when we talk about only energy e�-ciency, then there are buildings, there are appliances, there are industries and many more things. Similarly when we talk of MNRE again they have got the world out there. So, I think the agency which is handling all these things are already overburden with targets be-cause ultimately we only talk in terms of targets. It is also supposed to be ac-


The Government of India set up the Bureau of Energy Efficiency (BEE) on 1 March 2002 under the provisions of the Energy Conservation Act, 2001. The mission of the Bureau of Energy Efficiency is to assist in developing policies and strategies with a thrust on self-regulation and market principles, within the overall framework of the Energy Conservation Act, 2001 with the primary objective of reducing energy intensity of the Indian economy. This will be achieved with active participation of all stakeholders, resulting in accelerated and sustained adoption of energy efficiency in all sectors. Towards this the BEE

co-ordinates with designated consumers, designated agencies and other organizations to recognize, identify and utilize the existing resources and infrastructure in performing the functions assigned to it under the Energy Conservation Act. Irfan Alam spoke with Abha Shukla, Secretary, BEE on the bureau’s journey so far.

Need to make consumers aware of energy efficiency

INFOCUS | ENERGY EFFICIENCY | INTERVIEW


shi�, there has to be awareness which will take time. And for awareness to spread education is essential. Standards are getting better every year, and so the EER (Energy E�ciency Ratio) is changing every year or two.

Is there any specific programme aimed at SME clusters?

SME is the only area where we have adopted this approach of clus-ters. We have identi�ed 25 clusters and we have conducted energy au-dits report which has been shared with associations of the small scale industry. A number of them have been implemented because there is one component of energy e�ciency, which is called low cost measures. And by implementing these low cost mea-sures, around 15-20 per cent of energy e�ciency can be achieved. For that matter we have been coordinating with a Japanese agency which is our coun-terpart in energy e�ciency. �ey have been imparting training to our SMEs for the past of four years.

Do you think there is any con-nectivity between water and energy efficiency? Something called watery or water use ef-ficiency as it is termed, and whether you are doing some-

thing about it. Is there any connect between National Water Mission’s objectives of achieving 20 per cent en-hanced water efficiency and targets under the EE Mission.

Yes, there are close links between water and energy use especially when we talk about the sector. And last year we conducted a study that shows how these two things can be linked together. Even if go for energy e�ciency farms the water table and water output are the major factors a�ecting our schemes. We have to take into account that these two things must go together.

I think we have conducted one study, but right now I will not be able to tell about it because it still has to take shape. �ese are initial thoughts but we realize that these are very important and need to work out ways to formalize central training, to coordinate with di�erent agencies, because coordination is the biggest issue for any modern machinery. Because everyone has their own goal, targets, rules and regulation, coordination at times becomes very di�cult. But then everyone is realizing that this needs to

be done. �ere is de�nitely a link between the two age and it was discussed in our meeting with the Planning Commission.


cording to some budget. So, it is �ne they can empathize with our sensi-tivity store energy e�ciency. I think there are a few states were o�cers have been very dynamic and could bring about a few changes. But then it depends on the indi-vidual – you will �nd that in the same state they are do-ing very well where they are taking a personal interest, but in some states they are taking more interest in en-ergy e�ciency rather than in new renewable energy, whereas in others they are more interested in new and renewable rather than energy e�ciency.

Where does the country stand in terms of energy efficiency achievement targets? Are we placed at par with other developed countries in terms of achieving what we set out to achieve?

It depends. What do you compare yourself with? �ere has to be a refer-ence point which is very important. I have stayed in some countries where they have been into energy e�ciency

business for a long time whereas for starters like us it will take some time.

Do laws or policies actually matter?

Energy conservation or any resource conserva-tion law is something you can promote rather than

regulate. I don’t think that in each household you can

ensure that some amount of energy will be conserved or bring about e�ciency. You can only promote it. But you all are silent on

the promotional aspect your voice is very clear on conserva-

tion aspect.As far as the policies which

were put in place by BEE or Gov-ernment of India they are not

directly doing it, we are assisting them (government). �ey are basically promotional in nature. For example, the standards and labelling scheme is market driven; we opened this idea to the consumers and by and by it was ac-cepted by the consumers and markets were developed over a period of time for targeting products. I think people are getting more and more aware about energy e�ciency.

What needs to be done about consumer behaviour and markets?

Consumers actually don‘t care: If you have two products in the market, one with four star rating and other without any label, consumers will go for the product which costs less. �e majority of consumers go for price, only a small number of consumers who are aware opt for star rating. In devel-oped countries where consumers are more aware they will replace old appli-ances with the new labelled ones for ef-�ciency as per the new standards.

Energy e�ciency develops with the passage of time. �e sense of energy ef-�ciency will develop only when people become aware of energy e�ciency. So, you cannot put it on the consumer, or cannot make it mandatory. Ultimately if the consumer has money, he will buy the star rated product. For such a

for a long time, almost three to four decades. And that is why they are well ahead of us. Like the US, they have a standardization agency for a long time. When we talk about buildings, Switzer-land has done a lot. Similarly Norway, Germany and Sweden are much ahead of us. It is just because they are in this

INFOCUS | ENERGY EFFICIENCY | INTERVIEW

The scope for environmentconsultancy is opening up in India with more and more businesses realizing the importance of doing ecologically sound business.

Rajeev Betne

India’s Environment Protection Act 1986 is one of the most stringent Acts in India’s independent his-

tory that gives sweeping powers to the government(s) with regards to clearing business proposals as well as providing a composite framework within which these businesses must operate. �e laws under this Act are coming fast, and along with lots of teeth. Processes such as the Corporate Social Responsi-bility (CSR), the Extended Producers Responsibility (EPR) and value con-tributions to end-of-life management of their products are progressively becoming the norm.

�us increasingly, and rightly so, India is getting strict on allowing business here.

Additionally, the global environ-ment and health regime is also moving towards creating a Globally Harmo-nized Policy and Institutional Frame-work that countries need to adhere to (this is inclusive of international char-ters and conventions on such issues). Hence, not adhering to the global en-vironment norms in the coming future would also mean losing huge market share and thus unviable.

However, the business conditions here are not the same as in the west-ern world and a lot of dots need to be joined in this sphere beginning busi-ness and development is approached to resource-use minimization, waste minimization and conducting opera-tions in environmentally sound man-

ner. �is provides scope for environ-ment consultancy in a gainful and ethical manner. Situations in the rest of South Asia is not bright either provid-ing supplementary or multiple options for improving business ambience in the region, including space for policy con-sultancy and advocacy.

�e following areas present opportunities for green consultancy in India:

A. Environment ClearanceB. Environment ComplianceC. Environment Consultancy for waste managing business/ certi�ed recyclersD. End of life management (EPR modeling)E. Policy EngagementsF. �ird party audit/ certi�cation G. Environment education, training and capacity building H. Advisory services for industrial �nancing houses

A. Environment ClearanceIndia’s Environment Ministry had

issued the Environmental Impact As-sessment Noti�cation in the year 2006, which makes environmental clearance mandatory for development activi-ties for industries listed in its sched-ule. Most of the sectors fall under this

schedule. �e proponents need to pre-pare them in advance and in full details to get the environment clearance for their business activities. While some of the big players and proponents might not �nd it di�cult to form a team to speci�cally look into such issues of en-vironment clearance and compliance, many would like to outsource for vari-ous reasons, capital and working cost for such a professional team being the primary one. With the ‘environment clearance’ domain in India getting tougher by the day, and bridging gaps between business clients and regula-tory enforcement agencies reaching critical levels, there is enormous op-portunity for engaging in environment consultancy. In this domain a consul-tant would need to do the following: Keep track of the latest environ-

mental regulation and their clauses ap-plicable to business. �rough a certain mechanism (it could be a paid one) this information could be made available to prospective clients, especially new pro-ponents. For example, if a small pro-ponent likes to start a plastic recycling operation in region ‘x’, what are his/her environmental obligations to get start-ed with, whom should s/he approach for clearance, what information would be needed for business clearance etc. �is can be sort of knowledge manage-


INFOCUS | INDIA-CHINA | ENVIRONMENT

Open SesameENVIRONMENTAL CONSULTANCY IN INDIA


Rajeev Betne is a development professional with over 15 years of experience. He has worked extensively in the

�eld of environment research and advocacy. He heads the Chemicals and Health Programme at Toxics Link,

a New Delhi based environment policy group.

E. Policy EngagementsA consultancy establishment could

think of the following service for min-istries and government bodies: Consultancy on best policies Consultancy on institutional

reforms for better compliance rate Implementation of existing

policies is a bottleneck in India because the infrastructure, �nancial mecha-nism and monitoring mechanism are not in place. Here is the opportunity for policy level engagements with the governments to design suitable plan for implementing regulations Regulators training and capac-

ity building (at central and state level) in improving compliance Compliance reports prepara-

tion on di�erent sectors for ministries/ government agencies. Research advisory services for

frontier areas such as nanotechnology

F. Third party audit/ certification

�is is going to be one of the man-dates for industries in the future. �e state of Gujarat for example has already initiated this and the industries need to submit third party audit to the Pollu-tion Control Board within prescribed time schedule. Further, in this age of globalization, most �rms like to go for international certi�cations such as ISO certi�cations. �ese are very special-ized and high-end jobs requiring dedi-cation and specialized skills.

One could develop the required capacity to render third party audit/ certi�cation services.

G. Environment education, training and capacity building

�is is needed along the complete business chain including major stake-holders such as governments, indus-tries, recyclers and even educational bodies. �is opportunity could be har-nessed by consultancies by designing tailored training manuals and modules including workshops, presentations, talks, technical guidance, visits etc.

H. Advisory services for industrial financing houses

In the coming days India would see surge of green �nancing and the do-nor/ �nancial houses would stick to putting money in ventures that are en-vironment compliant. Because, putting money elsewhere would mean both, (a) loss of worth of money �nanced in case of the proponent getting blacklist-ed on ecological grounds and / or (b)

the �nancial house getting a bad name in the market for �nancing ecologically irresponsible business proponent.

Here a consultant could assist the �nancers/donors for ecologically re-sponsible �nancing.

With the looming global environ-mental crisis, the world is progressively moving towards enforcing green mod-ules of development. �ere is no sec-ond chosen path. India, aspiring to be-come a major global power, can’t a�ord to lag behind and thus has initiated steps to massively improve its business ambience and has taken relevant policy measures. From being a mere concern, ecological spillover of human endeav-ours (especially commercial ones) has become a critical thematic area of the development paradigm; with the con-stant lookout for better alternatives. �e situation calls for specialized inter-vention and hence unwrap a pack full of opportunity for green consultancy.

It is hoped that entrepreneurs would harness the maximum out of the given situation and contribute towards creating an ecologically just and glob-ally competitive business ambience.

[Red Light]

Waste & hazardouschemicals

Waste management in OECD countries

OECD country emissions of CFCs

Municipal waste generation

Developing country emissions of CFCs

Hazardous waste management and transportation

Waste management in developing countries

Chemicals in the environment and in products

[Green Light] [Yellow Light]

Table1: �e OECD Environment Outlook 2030 for Waste Management

THE GLOBAL WASTE MARKET IS ESTIMATED TO

BE APPROXIMATELY USD 410 BILLION ANNUALLY. THIS IS A CONSERVATIVE ESTIMATE OF

WHAT THE WORLDWIDE WASTE IS WORTH AS MANY NATIONS STILL DO NOT HAVE PROPER

INVENTORY IN PLACE


ment and extension service; For the above purpose a sim-

ple and user-friendly model for envi-ronmental clearance could be built for preparing report/s needed to get busi-ness clearance. Such models could be made available on paid basis; �e third level could be con-

sultancy for preparing required stages and documents/ reports, essential for environment clearance and getting the NOCs from the MoEF under various rules; Designing sustainable long-

term environmental plan and plan doc-ument for clients based on compliance requirements; A consultant could also assist

representing clients during clearance processes.

Here, the Environment Impact Assessment (EIA) needs a special mention. An environmental impact assessment is an assessment of the pos-sible impacts (positive as well as nega-tive) that a proposed project may have on the environment, the society and the livelihood, especially locals. As a thumb rule EIAs need to be conduct-ed independently and in an open and transparent manner.

�e EIAs require multiple skills based team and are considered one of the most proli�c consulting areas. Further, public hearing process for projects is a must; project proponents need assistance in which a consultant could provide help to get the projects going. �is is part of the overall clearance process.

Interestingly, environment clearance is also a stage where long-term relations with clients could be built for future gainful engagement.

B. Environment Compliance

Industrial facilities generally choose not to dedicate existing sta� or hire new sta� to manage en-vironmental compliance ac-tivities. Reasons include sub-stantial cost associated with having dedicated sta� and its associated liabilities. Also, compliance is a specialized job. Hence, the common trend is to

outsource compliance services. It is like companies outsourcing services such as �nancial audits, website development and maintenance, logistics, event man-agement, housekeep etc.

Following are the areas of pro�table consultancy one could think of in the Indian context: Providing advisory services

on compliance and regulatory requirements – for example production ambience, product speci�cation and content, labelling and product information, information compliance, waste management, production e�ciency etc; Assisting companies to re-

duce compliance costs by prioritiz-ing and streamlining compliance requirements; Preparing compliance reports,

environment audit reports for clients; Develop internal environment

reporting and self tracking mechanism for clients; Environment data manage-

ment for clients (this can be a huge business in future for consultants); Remediation consultancy,

specialty and emerging technology services could be thought of as a pro�table model; Referral services based on

expertise of di�erent consulting �rms in India.

�ere is huge opportunity with clients in the chemical industry, healthcare sector and waste-generating sector such as tourism (hotels etc), electrical and electronics, big malls, construction etc.

C. Environment Consultancy for waste managers/ certified recyclers

�e global waste market is estimated to be approximately USD 410 billion annually. �is is a conservative estimate of what the worldwide waste is worth as many nations still do not have prop-er inventory in place. However, even this conservative estimate provides for a ripe opportunity for waste-business in developing countries, including In-dia. Nonetheless, this business due to its very nature of handling potentially (and ecologically as well) unsafe mate-rials (Table1) would require even more rigorous mechanism for clearance and operation and is ultimately an open �eld for prospective consultants.

D. End of life management (EPR modeling)

A lot of �rms struggle to �nd so-lutions for end of life management of their products. Till date many have not even thought of integrating this in their business model. However, the new environment and health regula-tion norms progressively talk of Ex-tended Producers Responsibility and other kinds of contribution towards

end of life management of consumer products which ultimately enter into the waste stream.

A lot of opportunities lie in designing cost e�ective

and eco-friendly models for such entities (electrical manu-facturers such as CFL and batteries, healthcare facilities generating bio-medical waste, hotels generating food waste,

electronic manufacturers etc.)


INFOCUS | INDIA-CHINA | ENVIRONMENT

ShawahiqSiddiquiAdvocate in the Supreme Court and is part of the team drafting the Renewable Energy Law

Before the Climate Talks began at Durban in December, 2011, it was speculated that the country groupings will have a major

role to play towards a constructive outcome at the seventeenth Conference of Parties (Cop 17). It was understood that the Durban out-come would largely depend on the interplay among the BASIC (Brazil, South Africa, India and China), the EU and the much larger group of developed countries led by the US and com-prising Russia, Japan, Canada, Australia and others who have been historically been opposing legally binding carbon reduction commitments. �e BASIC group has always maintained that it cannot be treated on an equal footing with the developed countries on emission cuts because of its ‘developing world’ status. At the same time it would not let go o� the US and others to share a greater responsibility for their historic emissions responsible for the current climate crisis. How-ever, post Cancun, the EU and others in the de-veloped country groups have been increasingly asserting that ‘all emerging economies’ should take legally binding emission cuts. With green house gas emissions increasing �ve times faster in China, making its per capita emissions close to Western Europe, South Africa’s emissions be-ing even higher than China, and India and Brazil having low emissions comparable to the world’s poorest countries but rising at an accelerated

�ve times higher than its earlier emission rates, BASIC represents a group where its emissions, put together, are growing much faster than the world’s. Based on such statistics, the pressure on BASIC has been to accept obligations identical to those imposed on the North. �ose in the group, especially India and China, have been resisting this pressure on the principles of eq-uity and Common but di�erentiated liability (CBDR). Brazil and South Africa howevr were ready to accept binding obligations in return for �nance. But China and India responded to such pressures by adopting voluntary measures and country speci�c Climate Action Plans for reduc-ing carbon emissions intensity of their GDP by 40-45 per cent and 20-25 per cent respectively by 2020.

Of Kyoto and Climate Debt�e Kyoto Protocol is the world’s only ef-

fective document that provides for binding emission cuts. Kyoto di�erentiates between the North and South’s responsibility for climate change and mandates that the North, respon-sible for 75 per cent accumulated emissions, re-pay its climate debt. It imposes a modest �ve per cent cut of its 1990 level on the global north. Kyoto’s e�ective early phase—‘�rst commit-ment period’—that imposed mandatory emis-sion cuts ends in 2012. �e Annex 1 countries


INFOCUS | INDIA-CHINA | ENVIRONMENT | COVER STORY

DEVELOPED & DEVELOPING WORLDS

Climate change is a matter of justice. The richest countries caused the problem, but it is the world’s poorest who are already suffering from its effects. In Durban, the international community should have committed to righting that wrong. But instead it got caught with semantics.

|24| India-China Chronicle

Caught in semantics

|27|

the next year. �ough the Durban talks agreed unanimously on extending the KP period which was considered crucial for any future viable cli-mate deal, there are exceptions to it. �e Annex I countries namely Japan, Russia and Canada will not take any emission reduction targets for the second commitment period of KP. �is will have a potential impact on the total global emis-sion reductions which were targeted to be less than 20 per cent. �e role of India and China in the Durban negotiations assumes signi�cant role as both countries have signi�cant emis-sion rates but have been playing the developing country card to which the EU was not willing to agree. �ough China agreed to consider the legally binding agreement, India took a�ront to any such commitment on the grounds that agreeing to any such legally binding climate deal would mean to sign away the livelihood of millions of poor people in the country and that issues of equity could not be put away by the Durban Process. �ough both countries constructively engaged on the issue of a legally binding outcome and stood together at times in the face of strong opposition to the demands of the “EU Road Map,” they were supported by developing countries from the Alliance of Small Island States (AOSIS) and Least Developed Countries. �e EU had o�ered a second com-mitment period of the Kyoto Protocol but only under the condition that a new global agree-ment including all countries would be needed to be agreed upon as well.

EU’s Formula �e EU initially played a very positive role in

the climate talks but since Cancun, has turned

conservative. �e EU had been maintaining that it would support second commitment peri-od only if the Durban summit agrees to binding cuts for emerging economies. �e developing countries were very annoyed with this stand of EU as it meant obliterating the North’s histori-cal responsibility for climate change and there-fore had made Kyoto second period a precon-dition for Durban’s success. However, the EU could achieve a change in the semantics of the Durban Outcome. Instead of a ‘legally binding outcome,’ it agreed for an “agreed outcome with legal force,” suggested by Brazil’s chief negotia-tor, Ambassador Luis Figueiredo Machado.A�er EU, India, China and other countries agreed on the choice of words which would lead the course for di�erent legal options for a global climate agreement. However, the exact form of outcome with legal force is still to be discussed in future negotiations which will conclude in 2015.

�e Scienti�c Perspective From a scienti�c perspective, the current 2020

mitigation targets are not ambitious enough and the global mean warming would reach about 3.5°C by 2100 with the current reduction pro-posals on the table. As reported in the recently published UNEP emissions gap report, current pledges by developed and developing countries will mean that by 2020 global emissions will be 6-11 Gigatonnes of CO2 equivalent, higher than a 2°C emissions trajectory. Current pledges by developed countries fall far short of what is needed as they add up to no more than 12-18% reductions below 1990 by 2020. What environ-mental groups as well as the Intergovernmental Panel on Climate Change (IPCC) require is

IF CLIMATE CHANGE HAS TO BE SUSTAINED, EXTENSION FOR THE SECOND COMMITMENT PERIOD OF KYOTO IS NECESSARY. THE EURO-PEAN UNION, THOUGH POSITIVE IN THE EARLIER STAGES OF CLIMATE NEGOTIATIONS DURING BALI AND COPENHA-GEN HAD SOMEWHAT WEAKENED THE KYOTO’S FUNDAMENTAL PREMISE OF THE NORTH’S OBLI-GATION FOR A MORE RESPONSIBLE ACTION BY ASKING FOR SIMILAR BINDING CUTS FOR THE EMERGING ECONOMIES, WITHOUT WHICH IT WOULD NOT SUPPORT THE SECOND COMMIT-MENT PERIOD OF KYOTO



have been resisting the extension of Kyoto. �e US never rati�ed it but still had been making at-tempts to kill Kyoto and replace it with a ‘new climate regime’ until the survival of Kyoto was made central to the success of the climate talks at Durban.If the stand on the North’s historical liability for climate change has to be sustained, extension for the second commitment period of Kyoto is necessary. �e European Union, though positive in the earlier stages of climate negotiations during Bali and Copenhagen had somewhat weakened the Kyoto’s fundamental premise of the North’s obligation for a more responsible action by asking for similar binding cuts for the emerging economies, without which it would not support the second commitment period of Kyoto. On the other hand develop-ing countries had been sticking to their stand on ‘common but di�erentiated liability’ and had made the second commitment period a pre-condition for Durban’s success. Durban even before its start had feared to become another Copenhagen, where all major claimants and perpetrators of climate change colluded to write an atrocious deal to adopt voluntary national pledges that were founded on dubious econom-ics and have come to reveal as massive scandals, replete with over-ambitious emission cuts, mis-reporting, loss of valuable public subsidy and

�ctitious projects. �erefore, Durban was likely to fall in any of the following three options: (1) Carrying forward the previous framework de-veloped in Copenhagen and Cancun without any signi�cant political breakthroughs and legal pledges; (2) Moving to a more voluntary ‘non legally binding’ commitment period under the Kyoto Protocol; and a scenario where the EU would not move a step forward with a legally binding outcome, (3) �e agreement to a Kyoto Protocol’s second commitment period for devel-oped countries as already provided under Kyoto as well as initiating a new mandate for all major developing economies.

What Transpired�e Durban climate negotiations spanned

for 16 days, longest in the history of the United Nations Framework Convention on Climate Change (UNFCCC). �e parties adopted a “package” which included as its main elements an amendment to the Kyoto Protocol (KP), the decision to negotiate a global climate change agreement by 2015 and operationalizing the Green Climate Fund.�e amendment to KP is an agreement for a second commitment period, starting in 2013. Whether the duration of the second commitment period will be �ve years or eight years will be decided over the course of


General Assembly Resolution that initiated the UN climate change negotiations and led to the development of the UN Framework Conven-tion on Climate Change. �e 1990 UN General Assembly resolution called clearly for the nego-tiation of a “convention” (albeit a “framework” agreement) “containing appropriate commit-ments.” In contrast, the Durban meeting was unable to agree on a mandate to negotiate a le-gal agreement and contains no language about commitments. �e Durban platform could be satis�ed by an “outcome with legal force” — a formulation that as far as I am aware does not have any precedent in international law. Argu-ably, “legal force” means the same thing as “le-gally-binding,” and the addition of “with legal force” to “agreed outcome” (the Bali Action Plan language) means that the outcome is some-thing more than what Bali contemplated (which included COP decisions). But the inability to reach agreement on “legally-binding” suggests that at least some parties thought “legal force” might mean something less.Moreover, the Dur-ban Platform does not specify anything about the content of the new “protocol, another legal instrument or legal outcome with legal force.” �e assumption is that it will set forth emissions limitation commitments, but the Durban deci-sion does not say so explicitly. So, in theory, the Durban Platform negotiations could be satis-�ed by another framework-style agreement. In Durban, the issue was o�en framed as whether the BASIC countries would agree to negotiate a legally-binding agreement for the post-2020 pe-

riod. But, of course, the BASIC countries are al-ready parties to two climate change agreements, the UNFCCC and the Kyoto Protocol, one of which (the UNFCCC) already imposes general mitigation obligations on all parties, including the BASICs. So the issue is not whether China, India and the other BASIC countries are willing to become party to a legally-binding agreement, even one that imposes mitigation commitments on them. Rather, the question is whether the BASIC countries are willing to accept speci�c obligations to limit their emissions.

�e OutcomeOverall, it is understood that in Durban the

multilateral process was strengthened and more clarity on the legal form of the future agreement exists. However, despite the positive outcomes of the Durban conference, there are still concerns from developing countries that too much bur-den has been shi�ed onto their shoulders. Fur-thermore, the last-minute compromise on legal form was a missed opportunity to clearly estab-lish equity as a basis for the coming negotiations, and the principle of common but di�erentiated responsibilities (CBDR) has been undermined to some degree, rather than strengthened, as asserted by India during the response to EU’s formula on the last day.�e agreement reached in Durban though represents a step forward for the multilateral process. However, the agree-ment will not a�ect the emissions outlook for 2020 and has postponed decisions on further emission reductions.

THE MOST SIGNIFICANT OUTCOME IN DURBAN IS THAT THE US, CHINA AND INDIA HAVE AGREED TO BE INCLUDED IN A LEGAL FRAMEWORK AFTER 2020. RELATIONSHIP BETWEEN THE US AND CHINA HAD HAMPERED THE PROGRESS OF GLOBAL CLIMATE TALKS FOR SEVERAL YEARS BECAUSE NEITHER PARTY HAD BEEN WILLING TO BE THE FIRST TO MOVE. NOW, HOWEVER, FOR THE FIRST TIME, THEY ARE MOVING AHEAD TOGETHER TOWARDS LEGALLY-BINDING REDUCTION TARGETS FOR ALL MAJOR EMITTERS FROM 2020

Climate change activists demonstrate their support for a global climate change treaty in Durban



that developed countries move into the 25-40% range, as a �rst step, and subsequently to more than 40% below 1990 by 2020.

An Agreed Outcome or a Green Wash�e Durban outcome is referred to as “an

agreed outcome with a legal force.” However, the legal nature of this outcome has been le� unde-�ned. �e �nal broad component of the COP 17 decision, the Durban Mandate constitutes the following: (i) the Second Commitment Period (SCP) for emissions reduction by Annex-I coun-tries under the Kyoto Protocol; (ii) a decision on the work of the Ad Hoc Working Group on Long-term Cooperative Action (AWG-LCA); (iii) a decision on the Green Climate Fund (GCF); and (iv) an agreement on the Durban Platform. �is agreed outcome will be developed by an Ad Hoc Working Group on the Durban Platform for En-hanced Action (AWG), which will begin work in the �rst half of 2012. �e AWG will formal-ize the legal regime not later than 2015, the year in which it will be adopted. As stated that the Durban conference was most likely to fall within the three possible scenarios viz moving on with business as usual with Copenhagen and Cancun framework, defying Kyoto by agreeing to non legally binding nature of the commitment for its second phase and the third and most unlikely one being agreeing to extending Kyoto and bringing all major economies to an agreement for a legally binding mandate. Various climate gurus have in-terpreted the Durban outcome as very close to the third scenario i.e. an in-principle agreement by all for a legally binding regime for carbon emis-sion cuts. For the triumph of optimism, if this is construed to be the best positive interpretation of COP 17 then in doing so did the global commu-nity put the planet at risk? �is is a question that only science can answer. However, science seems to have lost to the complexities of legal interpre-tation on ‘legal outcome’ and ‘agreed outcome with legal force’. Whatever may be the phrase, the substantive outcome is the delaying of any con-crete action with commitment and responsibility by the developed and developing world. All that the nation states agreed in Durban is to launch a new negotiating process to develop a “proto-col, another legal instrument, or agreed outcome with legal force,” that will address the post-2020 period and will be “applicable to all parties.” In addition to this Kyoto Protocol is extended by another 5-8 years without any clarity on emission targets for its second commitment period, thus rendering it only a basic political decision. In ad-dition to this, parties agreed to establish a Green Climate Fund and transparency rules for the de-veloped and developing countries.

Role Played by China, India�e outcome seemed unlikely because there

was little indication that China and India would agree to negotiate a new agreement to limit their emissions. Without any agreement from China and India, the United States had said that it would not agree to a new round of nego-tiations. And without agreement by the United States, China, and India, the European Union would not agree to a second commitment peri-od under the Kyoto Protocol. What allowed the Durban outcome was a careful compromise that gave BASIC countries, on one side, a 2020 start date for the new agreement and some ambigu-ity about its legal character (about which more below), and gave the EU, small island states and least-developed states, on the other side, early start and end dates for the negotiations (the negotiations will begin next year and conclude in 2015) and language that the outcome of the new negotiations will have “legal force.” Inter-estingly, the United States apparently played something of an intermediary role, since it had some �exibility about the issues of both dates and legal form. In the end game of Durban, In-dia was unwilling to accept a mandate to negoti-ate a “protocol or another legal instrument,” and preferred the formulation of a “legal outcome.” �e United States suggested “outcome with le-gal force,” India added “agreed,” and the EU said ok. �us the deal was done.

Uniting US, China, India on climateDurban resulted in new country group-

ings with the EU, coalition of small island states and LDC’s on one side and the US, China and India on the other. �e Europe-an Union was successful in pushing through an outcome about which the United States, China and India were, at best, lukewarm. “�e most signi�cant outcome in Durban is that the US, China and India have agreed to be included in a legal framework a�er 2020. Relationship between the US and China had hampered the progress of global climate talks for several years because neither party had been willing to be the �rst to move. Now, however, for the �rst time, they are moving ahead togeth-er towards legally-binding reduction targets for all major emitters from 2020. How ambitious those targets will be remains to be seen, but the fact that all countries have agreed to this process is a major leap forward.

No Precedent in International Law�e Durban Platform is also pretty thin gru-

el as a negotiating mandate. In terms of its actual language, it is arguably weaker than the 1990 UN

THOUGH CHINA AGREED TO CONSIDER THE LEGALLY BINDING AGREEMENT, INDIA TOOK AFFRONT TO ANY SUCH COMMITMENT ON THE GROUNDS THAT AGREE-ING TO ANY SUCH LE-GALLY BINDING CLIMATE DEAL WOULD MEAN TO SIGN AWAY THE LIVELI-HOOD OF MILLIONS OF POOR PEOPLE IN THE COUNTRY

for its commitment to green energy, and India is the �rst nation to set up a ministry for non-conventional energy. India has all the capability to make use of solar and wind energy to cause a business sensation; all that is necessary is to activate it.

Launched in 2003, the four-year Indian Solar Loan Programme is a partnership between United Nations Environmental Programme and two of India’s largest banking groups to es-tablish a consumer credit market for �nancing solar homes in parts of India where the conventional electricity grid is absent or unreliable. �e innovative �nancing arrangement involves an in-terest rate reduction, market develop-ment support, and a process to qualify solar suppliers. India is poised for a solar economic boom with the launch of the Jawaharlal Nehru National Solar Mission, a comprehensive plan to com-bat climate change with solar energy. �e plan aims to establish India as the premier global leader in solar energy through a three phase approach the �rst of which is to commission 1000MW worth of solar projects by 2013. With all these supports in place, India is on the brink of a solar revolution, the fu-ture of which is entirely dependent on the Indian people.

China, on the other hand, already has a burgeoning renewable energy economy, growing exponentially. Chi-na’s wind resources are the largest in the world and it is the fourth largest producer of wind power. In addition, China is the world’s largest maker of wind turbines, and because of all these factors, the Chinese wind industry has appeared impervious to the widespread recession. China’s solar industry is also quite proli�c, producing over 30 per cent of the world’s photovoltaic solar panels. Solar energy is being supple-mented with the Golden Sun plan which provides subsidies and techno-logical aid for countries developing solar power. On top of that, China has an unusually large number of geother-mal hotspots, which makes the energy form e�ective and viable. China’s en-vironmental energy situation is grow-ing to the level that experts at Harvard University and Tsinghua University speculate that by 2030 China could


economically practical. Wind energy is another form of en-

vironmental energy that is becoming increasingly prevalent. In contrast to the various methods of harnessing solar energy, wind energy is generated in pri-marily one form, that of turbines. Tur-bines are the image usually associated with wind energy, giant wind-powered fans. Wind turbines take up minimal space and have a high e�ciency rate in addition to being good for the environ-ment. Unfortunately, wind turbines are also highly expensive and have various capacities depending on how hard the wind is blowing. While they are still an extremely viable energy source and particularly e�ective, turbines must be approached with a measure of caution.

Yet another type of green energy is geothermal. Geothermal energy is the use of heat in the earth for energy purposes. It’s not as common as solar or wind, but it still has a fair amount of potential and viability. �e main disad-vantages are its initial cost and, more importantly, the scarcity of building sites. Geothermal energy requires very speci�c conditions which are a huge im-pediment to mainstream construction. Because of this major problem, geother-mal energy is not yet as e�ective as solar or wind. Obviously, no change can occur instantly and switching to green energy will require a massive lifestyle change in society. To ease this transition a “hy-brid” approach is being applied, making use of both mainstream and alternative energy simultaneously while gradu-ally phasing out the former. �is same philosophy applies to transportation with hybrid vehicles already in the market. �e clear reduction of carbon dioxide from these technologies will de-crease the greenhouse e�ect and limit global warming.

Scenario in India and ChinaDespite having an optimum envi-

ronment for solar energy, India has yet to fully tap into its vast potential for re-newable energy. India happens to have an extremely well-made programme for supporting renewable energy and this could lead to India becoming a leader in the �eld of renewable energy. �e Indian Solar Loan Programme has won the Energy Globe World award

meet all of its energy demand through wind power.

The Road aheadSo why the slight detour into en-

vironmental energy? Because it is at the crux of the global warming issue and was the principal concern of the Durban conference. Debates raged on about how green energy should be employed to combat it and some con-troversial plans came up. One example came from Russia, to rede�ne which countries were “rich” and “poor” so as to distribute responsibilities toward green energy. �is idea was met with hostility by nations that would be re-categorized even though they are still developing countries (countries like India and China).

Both China and India rea�rmed their continued commitment to the cause, but asked the other nations to rec-ognize that they are still economically developing and will need more concrete terms before making concrete vows. �ey further emphasized that they had each done a large share of the work in combating climate change and demand-ed fair treatment for their work.

In the midst of all this, it became apparent that some real progress was �nally being made in areas like the eq-uity of responsibility between coun-tries and future plans such as the Green Fund for developing countries.

�e Durban conference made many lasting contributions to the reduction of climate change, but ultimately its greatest was its acceptance that cur-rent policies were not enough and that it is time for a change in how we view climate change and how we view green energy. �e Durban conference is an indicator that the energy industry is going to change dramatically and that a�er years of inconclusive re-sults it is �nally occurring. �e ball is �nally rolling.

Safaan Syed is a student with an avid interest in environment and development issues.


INFOCUS | INDIA-CHINA | REPORT

The Durban conference’s greatest achievement was acknowledging the fact that current policies were not enough and that it was time for a change in how we viewed climate change and green energy.

Rolling the ball in DurbanSafaan Syed

On 28 November 2011, countries gathered in Durban to hold the 2011 United Nations

Climate Change Conference. For almost two weeks delegates threw themselves into the chaotic subject of climate change, trying to devise a solution that would be fair to all. �e German media would go on to say that the Durban Climate Agreement was “almost useless” having neither con-crete pledges nor a speedy timeline. But this is an extremely shallow way to judge the conference, for it did some-thing crucial that had to be done: it got the ball rolling.

Climate change has always been a sensitive issue and this sensitivity has led to a hesitance to even broach the subject. �e conference marks a beginning to serious government ac-tion against global warming and a step forward in the pursuit of clean energy. Previous conferences, while providing important groundwork, were mostly spent arguing semantics and laying out an even base to begin building on. Now, with the Durban conference, we are �-nally beginning to reap the fruits of the previous conferences and the countries of the world are now in a position to making a decision on the future of cli-mate change and green energy.

Evaluating Past EffortsPast e�orts to combat climate

change have been fraught with error and ine�ective. �e best e�ort made so

far has been the Kyoto Protocol, which called for plans to reduce carbon diox-ide, created an adaption fund for de-veloping countries, and established a Compliance Committee to enforce the plans. �e Achilles’ heel of the Kyoto Protocol was that one of the major na-tions involved in climate change, the United States of America, has yet to ratify it. Without its signature the Pro-tocol remains ine�ective. �e confer-ence marks the end of the �rst commit-ment period of the Kyoto Protocol and with it nations are working towards an agreement on solving the pressing issue of climate change.

Climate change, earlier introduced as global warming by the world’s scien-ti�c community, is a phenomenon in which the natural greenhouse gases of the earth, which trap the heat from the sun and release the excess, are supple-

mented by the various gases released by modern industrial processes. �ese gases force more heat to be trapped from the sun than usual; this causes a sharp increase in the temperature of the planet, leading to changing weather patterns, ice cap melting, and other such environmental problems. Carbon dioxide emissions are reach-ing a record high, with an almost 50 per cent increase since 1990, due to the conventions of technology. Every-day conventions such as cars, factories, and coal-fueled power plants release gas into the air, resulting in more and more carbon dioxide, which leads to more and more climate change. Unless a change in approach and attitude oc-curs, climate change will continue to grow unchecked, causing unimaginable damage to the earth’s environment.

Role of clean energy Climate change is not an inevitable

fate and technology o�ers many sources of alternative energy in the future. Solar, wind, and geothermal systems are already being pioneered around the world and such energies

the key to cracking the climate change problem. �ese green energies are meant to reduce the amount of carbon dioxide in the atmosphere, thereby minimizing the change in the greenhouse e�ect and climate change. Solar energy is harnessed in many ways and is a very broad �eld of green energy. �e �rst form is through photovoltaic panels. Photovoltaic panels are the plates positioned on roo�ops that are o�en associated with solar energy. �is system was once written o� as too costly, but is now making a comeback due to reduced manufacturing costs resulting in cheaper panels. Another form of solar energy is what is called “concentrated solar power” in which panels jointly re�ect their rays into one point, creating tremendous heat, powering an engine and producing electricity. Yet another style of solar energy is Solar �ermal Energy which uses sun rays to heat a liquid into a gas, which then goes to an engine and generates electricity. Of all these methods, the photovoltaic system seems to be the most popular and the best “value” being both e�cient and

april 2012 India-China Chronicle |33|

such as, due to climate changes caused by global warming, the depletion of fossil water as a result of extraction of more fossil water, mainly for irrigation purposes, than the rate of its natural re-placement and every day misuse of our potable water. Moreover, excessive ex-traction of fossil water also deteriorates the quality of remaining ground water as the low quality water �ows towards

the same aquifers due to depression (as a result of excessive extraction of wa-ter) in those aquifers. �is precious re-source is also becoming scarce because of the degradation of water quality. �is is due to physical, chemical and biological pollution (both from point or non point sources of pollution) of fresh water resources (both ground wa-ter as well as of surface water resources) as a result of agricultural, industrial ef-�uent and domestic sewage, especially in highly populated and industrially developed regions. �is ultimately makes water resources unsuitable for potable use. Along with this, the rapid

ACCORDING TO THE WORLD HEALTH ORGANISATION, MORE THAN

1.1 BILLION PEOPLE DO NOT HAVE ACCESS TO SAFE WATER SUPPLIES.

THE WATER SUPPLY STATISTICS REVEAL THAT THE MAJORITY

OF PEOPLE WHO DO NOT HAVE ACCESS TO SAFE WATER SUPPLIES BELONG TO THE LESS DEVELOPED COUNTRIES AND, PRIMARILY, TO

LOW INCOME HOUSEHOLDS

Caption Caption Caption Caption Caption Caption Caption Caption

increase in world population, dramatic increase in the rate of urbanization, and industrialization has made this renew-able but fragile resource inaccessible to a large number of populations.

Acknowledging the signi�cance of adequate water services, since 1977, when the issue of the right to have ad-equate access to drinking water was ad-dressed at the international level for the

�rst time in Mar Del Plata Action Plan a number of e�orts have been made both in terms of awareness and reforms in technology, policy and institutional arrangements. Following the recom-mendations of the Mar Del Plata Ac-tion Plan, the 1980s was declared the decade of International Drinking Wa-ter Supply and Sanitation (IDWSSD) with a target of achieving 100 per cent

coverage in water supply and sanitation within the decade. In 2000, the United Nations Millennium Development Goals addressed the issue of water by setting a goal “to halve, by 2015, the proportion of people without sustainable access to safe drinking water and sanita-tion.” (United Nations 2001, MDGs: Goal7; Target 10). Although, these at-tempts have contributed much towards the ongoing e�orts to improve water services, nevertheless, despite these ef-forts, there still remain a large number of people who do not have access to adequate water services. According to the World Health Organisation, more


|32| India-China Chronicle april 2012

Amandeep Kang

Water is crucial to sustain life and a key element for socio-economic development. Access

to adequate water services has a direct relation to the signi�cant aspects of the socio-economic development such as elevation of poverty, enhancing qual-ity of life, improvement in health and environment.

Ironically, human beings have been exploiting water, the most precious gi� of nature and a basic necessity to sus-tain life on this planet, for centuries in their own desired way.

Today, we are concerned about this precious resource which is being increasingly depleted in many ways,

The key to successful community participa-tion in water supply management is to make the community understand the value of water resources and invite them to partici-pate in managing the scarce resource.

Our Water Our LifeMANAGEMENT & DELIVERY OF WATER SERVICES

april 2012 India-China Chronicle |35|

sector water provision in many parts of the world. With this institutional change, a variety of arrangements focused on market approach have been introduced in the delivery and management of water services. �e proponents of the private sector arrangements argue that by involving the private sector in water provision, it will better assist in gaining investment needed for the required infrastructure and enhance the operating e�ciency of the provision through introducing a high level of technical and management skills. �e private sector, in the water delivery sector, is introduced in a variety of forms depending upon the level of participation of the involved actors. In the context of water delivery, privatization (full divestiture), lease, concession and B.O.T. contracts are di�erent forms of this institutional arrangement, which are based on the principle of competition and prices. Some of these forms are also known as ‘joint ventures’ or ‘Public Private Partnerships’. At the lowest end of this arrangement lies the management support contracts where the private sector is involved only in speci�c tasks and paid by the public authority. At the other end lies the ‘divestiture’ or ‘full privatization’. Only England and Wales have a full divestiture of water services when talking about the scale of its implementation.

trepreneurs for their water supply. Ini-tially, this arrangement was considered irregular and illegal as it operates out-side the o�cial framework. It has also been criticized as an expensive arrange-ment as studies pointed out that o�en the poor spend much more on buying water from the vendor than those con-nected to the direct water supply. Re-cently, however, there has been a shi� in opinion regarding the e�ectiveness of this arrangement because of recent �ndings of its contribution in comple-menting the formal water provision.

Hence, as discussed above, there are a variety of institutional arrange-ments (with their own strengths and limitations) available for the manage-ment and delivery of water services. However, in order to manage and deliver sustainable and e�ective water services, it is immensely important that an institutional arrangement should be based on an appropriate understanding and acknowledgement of the socio-economic, political and institutional capabilities under which the system will be operating.

PROPONENTS OF THE PRIVATE SECTOR ARRANGEMENTS ARGUE THAT BY INVOLVING THE PRIVATE SECTOR IN WATER PROVISION, IT WILL BETTER ASSIST IN GAINING

INVESTMENT NEEDED FOR THE REQUIRED INFRASTRUCTURE

AND ENHANCE THE OPERATING EFFICIENCY OF THE PROVISION

THROUGH INTRODUCING A HIGH LEVEL OF TECHNICAL AND

MANAGEMENT SKILLS

Amandeep Kang is a researcher with expertise in water governance and institutional arrangements

Small-Scale Entrepreneur Arrangements

Another type of institutional ar-rangement in the water sector, gener-ally known as ‘informal arrangements’, is the small-scale entrepreneur arrange-ments. In many developing countries, the small-scale entrepreneurs are �lling the gaps le� by the government and the formal private sector in delivering water, especially to the poor. �ese small-scale entrepreneurs include pri-vate independent and NGO provid-ers, which range from water vendors to community based water provisions. It has been found that 25% of residents in Latin America and 50% of residents in Africa depend on these small-scale en-


|34| India-China Chronicle april 2012

however, for decades the public sector water provision, administered through the municipalities, has remained a dominant and most favoured option. To date, public sector is still the pri-mary provision for water services in most parts of the world. �e acknowl-edgement of water as a social or public good makes water provision a respon-sibility of the public sector. �erefore, one of the key arguments for the case of public sector water provision is that as water provision provides public bene-�ts, it must be controlled and managed by the public sector. Following the acknowledgment of water as a human right and social good, it is suggested that water services must be managed under the public sector.

However, to some extent, the pub-lic sector water provision has failed in practice to deliver the results in relation to its theoretical base as evident by the fact that there still exist a large num-ber of people that are without access to adequate water services, especially in the less developed countries. �is suggests that, in practice, the public sector water delivery arrangement has some serious limitations. One of the major limitations of this arrangement is its top-down approach and the lack of decentralization and a single inde-pendent authority responsible for the water sector, especially in the context of developing countries.

Private Sector ProvisionIt was during the 1980s, when

the market-led private sector water provision initially replaced the public

social good and a basic human right argue that as water is a fundamental necessity of life, therefore, it should be accessible to every individual without any condition. On the other hand, the proponents of water as a commercial commodity believe that it is necessary to price water to manage it e�ciently and to achieve its true value. �ese pro-ponents support the market model of development where prices can become the mechanism for its allocation, dis-tribution and consumption.

Existing Management and Delivery of Water Services

Public SectorHistorically, throughout the world,

water has been considered as a public good and managed by local govern-ments. Although, from time-to-time, some other forms of arrangements also appeared for a short span of time,

than 1.1 billion people do not have ac-cess to safe water supplies. �e water supply statistics reveal that the major-ity of people who do not have access to safe water supplies belong to the less developed countries and, primarily, to low income households.

In general, ‘water crisis’ is o�en understood as the reduction in the global water quantity on earth. How-ever, this crisis is of ‘water governance’ i.e. mismanagement of water resources or services which makes this precious resource either inaccessible or un�t to consume. In recent years, it has been acknowledged that this failure of inac-cessibility to adequate water services is not primarily a technical problem; it is more an institutional problem.

�roughout the world, there is a diversity of formal and informal insti-tutional arrangements existing in the provision of water services such as pub-lic sector water provision, private sec-tor water provision, a variety of public-private partnerships and public-public partnerships, small-scale entrepreneur arrangements and community-based water provisions. �ese arrangements are primarily based on macro level policy-driven approaches. �e un-derpinning ideological debate among these approaches is with respect to the question of ‘management by whom?’ i.e. whether water should be managed by the state under the public sector or managed by private enterprises un-der the private sector. �erefore, the basic debate is whether water should be treated as a social good and a basic human right or as a commercial com-modity. �e proponents of water as a

THE BASIC DEBATE IS WHETHER WATER SHOULD BE TREATED AS A

SOCIAL GOOD AND A BASIC HUMAN RIGHT OR AS A COMMERCIAL

COMMODITY. THE PROPONENTS OF WATER AS A SOCIAL GOOD AND A

BASIC HUMAN RIGHT ARGUE THAT AS WATER IS A FUNDAMENTAL

NECESSITY OF LIFE, THEREFORE, IT SHOULD BE ACCESSIBLE

TO EVERY INDIVIDUAL WITHOUT ANY CONDITION


Anchit Goel is based in Shanghai.(�is article is for information only and not a legal advice)

objectives in China, you can establish a Joint Venture ( JV). However, there are signi�cant risks and pitfalls associated with this structure. �is does not mean you should not form a JV. It can be a successful endeavour if you understand whether your Chinese partner is capable of ful�lling your business objectives and each side’s goals, contributions and responsibilities are mutual and understood.

A JV could be an Equity Joint Ven-ture or a Co-operative Joint Venture also known as Contractual Joint Ven-ture (CJV). In EJV mode, the foreign investment in the project must be 25% and partners share pro�ts, losses and risks in proportion to their contribu-tion to the registered capital. But in CJV mode, partners share pro�t on an agreed basis, not necessarily in pro-

portion to capital contributed. �e foreign investor can obtain the desired level of control by negotiating manage-ment, voting, and sta�ng in advance with the Chinese partner. �is mode is more convenient and �exible. �ere-fore it is easier to �nd a co-operative partner and reach an agreement. But at the same time a CJV could be time consuming and involve di�cult nego-tiations in the beginning.

Whether you choose a JV or a WFOE, you can incorporate your company in China in two ways – Limited Liability Company (LLCs) or a Joint Stock Company. Most FIEs in China are set up as LLCs as in this case your personal liability is limited to the amount of money you invest. An LLC cannot issue shares and has a speci�ed life of 30 years, which can be extended. Joint stock companies are more complex in nature as their capital is divided into shares and any legal entity or individual can invest in the company in exchange for the

proportional amount of shares.�ere isn’t one single structure which

is the best. Each has its own bene�ts and drawbacks. Your choice should depend on your business objectives and how much time and �nancial resources you are ready to invest in pursuing those objectives. I would strongly advise you to �rst seek expert legal advice before setting up o�ce in China. �e India China Economic & Cultural Council (ICEC) has a panel of eminent lawyers/law �rms with expertise in the Chinese market to help you understand each organization structure in detail, its

Representative Office FIE (JV or WFOE)

Setting up requirements

Prior approval required from Ministry of Commerce (MOFCOM) No registered capital requiredParent company must be in operation for at least 2 years in its home country

Prior approval required from MOFCOMMinimum paid up registered capital required depending on the industry

Permittedactivities

Can do non-profit communication, market research, relation building, exhibit products or services, liaison and coordination activities; Cannot do any direct profit making activities, sign contracts or bill customers. Additional rules for business sectors such as banks, insurance institutions, securities organizations, accounting and law firms.

Can do profit making activities, issue invoices, receive RMB payments and earn profits.

ProhibitedIndustries

Certain business activities in the farming, animal husbandry, mining and quarrying, telecommunications, postal, manufacturing, scientific research, power, irrigation and education sectors are prohibited from foreign investment.

Fundingof local

operations

Through money sent by parent company

Through money sent by foreign company and profits generated by business operations

Cost and Time for Setting

USD 1,000 to USD 5,000; 2-3 months to set up

Registered capital could vary from USD 10,000 to over USD 1,00,000 depending on the industry and location; 3-4 months to set up

Hiring of Employees

Cannot hire local Chinese staff; can hire foreign nationals (one Chief Representative and maximum 3 ordinary representatives)

Can hire Chinese employees after signing contract as per requirements of Labour Contract Law

Compliance Requirements

Submit an annual report to the registration authority between 1 March and 30 June

Annual audit reports (balance sheet and income statements) to be submitted to relevant authorities

Principal Applicable

Laws

Regulations on Administration of Registration of Resident Offices of Foreign Enterprises; some local provincial governments have their own requirements

Company Law, Law of the People's Republic of China on Wholly Foreign- Owned Enterprises and Law of the People's Republic of China on Chinese-Foreign Joint Ventures, Sino-Foreign Equity Joint Venture Law, Sino-Foreign Cooperative Joint Venture Law

Tax Requirements

Generally 10% tax on the Gross Expenses of the office

Depends on place of registration and industry; begins with 25% although some industries enjoy a lower rate of 15%

THE WORLD BANK RANKS CHINA 91 (OUT OF 183

COUNTRIES) IN ITS ANNUAL ‘EASE OF DOING BUSINESS’

RANKINGS FOR 2012.

requirements and procedures. It can also �nd a suitable partner for your JV in China.

For any queries you may have please email me at [email protected].

INFOCUS | INDIA-CHINA | DOING BUSINESS


China is not the easiest places to do business in. A guide to overcome hurdles across the Great Wall.

The First Step

DOING BUSINESS IN CHINA

Anchit Goel

The bilateral trade between India and China touched a new mile-stone of USD 73.9 billion in 2011

as against USD 61.7 billion in 2010. China has become a hot favourite among many Indian companies who either want to source their products and raw materials from China or want to o�shore their production facilities to a cheaper location and/or sell their products in China.

Despite this attractive quality, the country is not an easy place to do busi-ness in. It is a complex market with its unique culture, di�cult language and its own style of doing business. Busi-nesses need to consider a wide range of strategies, evaluate the advantages and disadvantages before setting shop in China. �e World Bank ranks China 91 (out of 183 countries) in its annual ‘Ease of Doing Business’ rankings for 2012. At the same time, there is a short-age of skilled and stable consulting pro-fessionals with rich practical experience of working in China and knowledge of

the �nancial, regulatory and market environment in China, who can pro-vide right guidance to those interested in China. �erefore, many companies �nd it very challenging to do business with China.

Here we will attempt to address this challenge through a series of articles on various aspects of doing business in China. �is will include how to enter the China market, choosing the right location for your business, establish-ing relationships (Guanxi), recruit-ing sta�, sourcing, manufacturing and selling in China. In this article we deal with the various modes of entering the China market – the di�erent forms of business organization and which form should you choose for your business. �e structures typically used by foreign investors in China are: Representative O�ce (RO) Foreign Invested Enterprise (FIE) Joint Venture ( JV) Wholly Foreign Owned Enter-

prise (WFOE) – usually pronounced as woo�e

Each organization structure has

its bene�ts and drawbacks. �e table shows the di�erences between a RO and FIE.

If you are planning to do an initial feasibility study, understand the market, network, research about the opportunities for your products/service then establishing a Representative O�ce (RO) would be the right step for you. It is also faster, cheaper and easier. Once you feel that you have understood the market well and see a demand for your o�erings in China or would like to establish a manufacturing plant, you can establish a WFOE or convert your existing RO to a WFOE. With WFOE status you can formally carry out your business, issue invoices, receive RMB revenues and convert your RMB pro�ts into US dollars.

If you feel that you do not have the required �nancial capacity and expertise of the China market and would like to partner with a Chinese company to further your business

APRIL 2012 India-China Chronicle |39|

ICC: Fugumobile is a marketing solutions provider for many leading consumer brands in China. Could you tell us more about your business and the products/services you provide?

Bose: Fugumobile is a mobile marketing and advertising agency, do-ing business in China for the past 10 years. Rather than being on the tradi-tional side of advertising we are more on the digital side, which includes both internet as well as mobile ad-vertising. We are working with many leading brands creating marketing solutions and advertisement strategy for the mobile platform.

�ree-four years ago there were no smart phones or tablets. �at time the dominating source of advertising on mobile was through targeted text SMS with no visuals. Now with the advent of technology and rapidly increasing number of mobile users, digital ad-vertising has become more interactive and with a wider reach. So more and more brands are using mobile phones as a medium to reach and retain consumers. We provide such clients with complete end-to-end services (from concept to execution) across all mobile platforms including SMS, MMS, WAP, QR Codes, Bluecasting, and multiple app environments.

What is the profile of your clients? Are they only Chinese or also include MNCs?

Many of our clients are MNCs brands. �e campaigns are done mostly for the Chinese market as well as for other markets including India, Europe, US, Southeast Asia and many more. As China has a big automobile industry, our biggest clients are some of the automobile companies, such as Mercedes and BMW. For Mercedes AMG, the high end cars, we devel-oped a mobile application providing a 360 degree view of the car and its fea-tures. Same was also done for BMW with some more features like the his-tory of the car, videos and wallpapers. Last year during the cricket World Cup, we developed an ad campaign for Reebok shoes in India, develop-ing wallpapers, 360 degree view of the

shoes and some gaming applications targeting the young generation.

Have you faced any competi-tion in China, especially from local Chinese companies, when reaching out to your customers?

Fugumobile is technology as well as creativity focused company. �e cre-ativity part includes understanding of the brand and what kind of solutions suit that brand. A�er branding comes the tough part of inserting technology into creativity.

In China, we have faced com-petition from technology as well as creativity oriented companies. On technology side are many local Chi-nese companies and on the creativity side are many traditional advertising agencies. But what makes us unique is that we are able to combine these two – technology and creativity. If the brand goes to a technology company then they are not able to come out with creative mobile concepts and strategy. Similarly, creative companies don’t have the technical talent to execute solutions. In the last 4-5 years, we have observed that many creative companies come to us to develop these solutions as they �nd it di�cult to in-corporate creativity with technology.

What is the biggest challenge you have faced, both in terms of your business and the general Chinese business environment?

We did not face any major chal-lenge in setting up the business in China. But we did in terms of the services we provide. �e biggest chal-lenge was to convince the brands for advertising on the mobile platform. �ere was no one to take the �rst step as this was a very new concept in the advertising world. China has over 800 million mobile users but still it was di�cult to convince brands on how e�ective the mobile campaign will be. Luckily brands like Coca-Cola and Nike, which are very innovative in their advertisement campaigns, were willing to trust us and take the �rst step. Now more and more brands are willing to have such advertisements

Ravi Shankar Bose is the Director of Fugumobile Ltd, a successful Shanghai based company started by Indians. Bose possesses a rare quality that most marketers aspire for: A grounding in technology combined with a deep understanding of brands. Following stints in the IT industry in India, Bose has spent the last nine years working in the mobile marketing and gaming business in China and has grown with the nascent digital marketing industry from basic to ever evolving platforms for consumer engagement. Proficient with both online and mobile platforms, Bose is a firm believer in the convergence of digital media and spends his free time reading about the latest technologies. He speaks with Anchit Goel about his experiences in China.

|38| India-China Chronicle APRIL 2012

INFOCUS | INDIA-CHINA | INTERVIEWINFOCUS | CHINA-INDIA IT SECTOR | REPORT

China market is not a cash cow


Dennis Pamlin

The two countries that will domi-nate the 21st century in many ways, China and India, face a very chal-

lenging situation, but also very inspir-ing opportunity.

On the one hand they need to en-sure that they can li� people out of poverty and do so in an environmen-tally sustainable way. On the other hand they need to design a global gov-ernance system that can help the world to move beyond the industrial society with a single-minded focus on eco-nomic growth and embark on the next chapter in human history.

�ese are two very big challenges,

CHINA-INDIA AS TRANSFORMATIVE FORCE

maybe the biggest challenges humanity have ever faced and they will take place during a time when the phase of change is higher than it has ever been through history. Collaboration between China and India will be complicated, but is necessary to ensure robustness, to avoid con�icts and ensure that wisdom from both cultures is embedded in the new governance system.

�e �nancial crisis in the world has brought the western superpowers to their knees and they now understand that the emerging economies must be given a more important role when global economic policy is being devel-oped. Unfortunately so far China and India have not taken the opportunity

to formulate a proactive policy and in-stead large corporations, with business models that are based on great income di�erences and consumption patterns that are destroying the planet, are setting the agenda.

But the di�erent �nancial problems are however getting worse and instead of ad-hoc solutions it is time to launch initiatives that look beyond short-term �xes. Below the surface we have a number of trends that require a dra-matic change in how the current global governing system works, including the Bretton Woods institutions that were created a�er World War II.

�e �rm action that the current �nancial crisis requires is a perfect

The Brave New G2 World

While most people are looking for a US-China G2 along the lines of the old school, the most important G2 could be that of China and India. We should see these two in a relationship that is mutually beneficial.

|40| India-China Chronicle APRIL 2012


and the challenge has reduced to some extent. What still remains a challenge is the need to be understand on how big mobile advertising can be.

As far as the Chinese business environment is concerned, we faced challenges with the local companies as they are very cost competitive and concerned about quality and creativ-ity. Now there is no measuring scale for creativity, so lot of the challenge is faced in the process of project man-agement and costing of these elements. �ey di�er in terms of the process they follow and the way they de�ne the scope of work.

There is lot of talk about the need for Guanxi (relation-ships) when doing business in China. What has been your experience?

Guanxi is followed in some extent in China. But then if you provide good service and quality products, you do not need Guanxi for your business development. �e Chinese like any-where else always want good services and quality products. If you provide them with that they will look forward to doing business with you. �e key to doing good business in China is to provide a unique product or service which will certainly add lot of cred-ibility to your business. And at the same time you have to maintain the balance between foreign and local cul-ture, follow a blend of both cultures.

What is the mindset of the Chinese regarding Indian companies?

What we have seen generally is that the Chinese see Indian companies from the digital side, as the Indian so�ware industry is very famous. �ere are no speci�c issues with In-dian companies. �ey consider us like any other foreign company doing busi-ness in China. �ere are no issues with the sta� also, which includes Chinese, Indians and some others from abroad.

As a marketing and advertising expert, what differences do you see between Chinese and Indian consumers?

�e basic outlook of consumers is price. Indian consumers are more price conscious than Chinese consum-ers. Chinese consumers have a taste for uniqueness, they try to purchase new things with some unique value attached to it. In China, gadgets are more preferred especially in the digital segment. Chinese are always trying to change and buy something new from the market. �e same trend has also started picking up among Indian consumers. At the same time, Chinese consumers are very brand conscious and look for branded product. If they think of getting some particular brand they will either buy it or if it is not a�ordable they will purchase the coun-terfeit of the product.

What do you think about Made in China products?

Basically there are two kinds of made in China products. One includes your high range products for MNC brands such as Sony, Nokia and Apple. Most of the big brands have their manufacturing units based in China. When people buy products of these brands, they go by the brand name and are not concerned whether the product is made in China or not. �is is one perception of consumers.

�en there are low priced products manufactured by local Chinese brands such as TLC, Haier and Hisense etc. When consumers buy low price prod-ucts, their general perception is that this product is made in China. But then it provides the consumers with a lot of options and �exibility. So there no reason to complain about made in China products. Basically the high end products are used worldwide and the low end product face this made in China concept.

In India there is a lot of negative perception about China. What do you feel about it and how do you think it can be minimized?

�e negative perception of Indians towards China is mainly due to the media, which is very biased in nature. Most of the time they do not have �rst hand news about China and it is taken from other sources. Only one or two Indian reporters are based in China. But slowly things are changing. �ere is huge trade happening between the two countries. More and more Indian traders, professionals are coming to China to do business and once they come here, their perception changes. One of the other things is that there is limited cultural exchange between India and China. �e existing e�orts are all government linked and not well coordinated. Chinese here earlier used to watch Hindi movies and still remember Raj Kapoor in Awara. Because of some political issues also there is a negative perception about China in India. And lot of this is com-ing from the Indian media, for which Chinese media has started to hit back. �is certainly is not a good thing in improving the relations.

What suggestion would you like to give to those Indians interested in setting up business in China?

First and foremost, the Chinese market is available for local as well as foreign companies. Before starting any business in China, you need to have good market knowledge through market research. Enter into China a�er having a good understanding of the available opportunities and the Chinese consumers. �en it will be easy to start your business in China.

Secondly, China is not an easy market to survive. It is not a cash cow where you can start earning immedi-ately. Many companies have come and failed to even establish themselves. You need to have a long term approach. Important is to break even and keep your costs low. Start with a small base, see how your Chinese counterparts operate and keep the cost low and understand your customers well.

INDIAN CONSUMERS ARE MORE PRICE CONSCIOUS THAN CHINESE

CONSUMERS. CHINESE CONSUMERS HAVE A TASTE FOR UNIQUENESS,

THEY TRY TO PURCHASE NEW THINGS WITH SOME UNIQUE

VALUE ATTACHED TO IT.


the two countries – which together contain about 40 per cent of the world’s population – can develop joint innovative strategies for global sustainability, it will be a very good step forward for this current crisis.

�is Chindia G2 understands the need for innovative solutions that de-liver more than incremental improve-ments, as this is necessary to li� people out of poverty and deliver solutions that do not result in con�ict over natu-ral resources a few years from now.

So while most people are looking for a US-China G2 along the lines of the old school, the most important G2 could be that of China and India. We should see these two in a relationship that is mutually bene�cial.

With a global agenda that delivers global bene�ts, China would start building a global governance culture beyond narrow self-interest that also includes scienti�c consideration for the planet in a way that the current economic system has failed to do. �is would be a very good start for the 21st century and a way to turn the current economic crisis into something that will bene�t both the people and the planet in a way that we have never done before, but something we urgently need.

Deng Xiaoping once said that a real Asian century will arrive only when China and India are developed – the time is now emerging and for it to de-liver a positive outcome, the two G2s could play a crucial role.

China and India are in a position where small investments and initia-tives today can determine structures and rules during the coming decades. In order to ensure a positive outcome strategic collaboration in three areas is necessary:

Education/ research Technology development Urbanization

For these three areas Chindia could collaborate to ensure the following:

A 10 billion filterIn order to ensure that we

can eradicate poverty and ensure environmental sustainability we need to focus on transformative solutions,

country. Hopefully many in the �rst generation of global citizens would come from China and India.

A global collaboration platform could be launched during 2012 to encourage researchers and entrepreneurs from all over the world and from di�erent disciplines to collaborate in order to address poverty and resource scarcity in a limited number of areas to start with. Besides becoming a key collaboration platform it could also reward those delivering solutions and become a Nobel prize for the 21st century.

Use global forum to launch global initiatives

In 2012 India, with Manmohan Singh as the host, will arrange the sec-ond BRICS meeting. �is would be a perfect time to launch initiatives for the 21st century.

One of the most di�cult challeng-es will be to develop frameworks that support transparency and ensure that citizens all over the world can use it. A good �rst step would be to support an initiative that would allow citizens all around the world to understand the consequences of their consumptions. By developing an application for smart mobile phones that could be used to scan di�erent products people could see in real time if people are helped out of poverty though the value chain, if the company making the product is lobby-ing for smarter regulation, what goals for poverty reduction and resource sav-ings the company have, etc. In short a world that western industrialization made invisible would be made visible and the birth of this transparency that can drive sustainable innovation and poverty reduction could happen in Delhi in just a few months.

not just incremental improvements in current systems.

By introducing students from all disciplines to think about what solutions that can be used by 10 billion people without harming nature and resulting in con�icts over natural resources.

Extremely resource e�cient solu-tions, using renewable energy and sup-portive of a global circular economy should be encouraged in all areas.

At the end of 2011 during COP17 in Durban the BASIC expert group presented their �rst joint research report about sustainable development and equity. �is is the kind of initiative that should be further developed and provided more resources in order for it to also be able to develop concrete policy recommendations.

China and India could challenge themselves and the rest of the world to begin reporting how public procurement can be used to encourage transformative solutions that can be used by 10 billion people in a sustainable way. If China and India could get the EU, the US and Japan on board more than 5 trillion dollars would begin to support poverty reduction and true sustainability.

A global research initiative Global collaboration, rather than

international collaboration, should be initiated where major scienti�c breakthroughs with global bene�ts are to be expected.

Nano-technology and cognitive research are likely to be two areas that will rede�ne how our societies look this century. �e opportunities are almost limitless, but so are the potential dangers. A council of independent and non-commercially connected stakeholders should be provided with the task to set up an open source and transparent forum where strategies to guide this research and implementation in a way that is bene�cial to humanity as a whole.

For the �rst time it could be pos-sible to have a technological revolution based on collaboration instead of com-petition, where many that are engaged would identify themselves as global citizens rather than from a speci�c

Dennis Pamlin is an entrepreneur and founder of 21st Century Frontiers. He works with companies, governments and NGOs as a strategic economic,

technology and innovation advisor.

INFOCUS | INDIA-CHINA | GLOBAL ORDER


THE FINANCIAL CRISIS IN THE WORLD HAS BROUGHT THE WESTERN SUPERPOWERS TO THEIR KNEES AND THEY

NOW UNDERSTAND THAT THE EMERGING ECONOMIES MUST BE GIVEN A MORE IMPORTANT

ROLE WHEN GLOBAL ECONOMIC POLICY IS BEING DEVELOPED

opportunity to begin looking toward a new global architecture. At the very center of this architecture are two di�erent G2’s that will play a very important role.

�e �rst G2 is the one that has been discussed in media since the beginning of the �nancial crisis, that of China and the United States. �is is the G2 that follows the logic of the current system. Few would disagree that the G8 that exists today is increasingly outdated and that something new is needed. �e G8 was a response to the oil cri-sis in 1973 and when it was formed in France in 1975 it was the major west-ern countries that came together. �at time is gone and we have a di�erent situation today.

�e two major economies on the planet should have a special rela-tionship and the “strategic and eco-nomic dialogue” mechanism that was launched during the G20 meeting in London provides a great opportunity.

It is important that China is clear and does not allow the old, polarized agenda to dominate, so that G2 be-comes a smaller, more e�ective ver-sion of G8. China’s global role so far has been a breath of fresh air as it does not seek global leadership, but instead wants to work in collaboration with all countries and on all levels.

With the US as a major consumer and China as a major producer, we can hope for a “global collaboration” initiative. �is could focus on the ma-jor challenges we face and how China and the US could together, with other countries, to �nd solutions for them.

�ese solutions could range from major initiatives with incentives that support sustainable innovation and standards that ensure future buildings are the net producers of energy. Instead of being the largest problem for climate change and resource use, the buildings of the world could become the epi-center for climate-smart and resource-e�cient solutions. For this to happen, China and the US must cooperate. India could play an important role as a credible mediator in these discussions.

Strategic collaboration in trade, investments and �nance, as well as in security

policy and other important areas should be encouraged.

In order to identify the second, and more important, G2 we must take a step back to the macro level. It is easy to see that the centre of the global econ-omy is moving east. �e need to �nd long-term solutions for a �nancial sys-tem where the money can move at the speed of light will require new regula-tions and new institutions.

But there are other issues that are harder to see, issues that will not hit the headlines before it is too late, as they happen slower. �ese include issues such as the demographic crunch with an ageing global population, the increased population pressure as the world moves toward 10 billion people, growing inequalities within and between countries, and �nally an accelerated development of new technologies.

All these can bring humanity fantastic gi�s if they are met with the right framework, but they could

also drive the world into con�ict and problems beyond imagination. Especially since natural resources on the planet are not enough to provide everyone with a “G8 lifestyle”.

�is brings us to what I think is the more interesting, and less discussed, G2 – China and India. I was fortunate to be in Delhi during President Hu Jintao’s visit in 2006. During this trip, a number of initiatives were started and it is clear that the two billion-plus population countries share many challenges and opportunities.

Cynical observers have focused on the di�erences between the countries and many western observers seem to view China and India as pawns in the power play between the G8 countries. But anyone who can do the math and look at the history of these two coun-tries will realize that there will be a very interesting G2, whether we like to call it that or not.

By ensuring closer and more strategic ties between China and India, the world will get two countries with long, proud histories that are a welcome balance to the dominating Western narrative in most of today’s global institutions. �e world would also get two countries that are re�ections of how the world as a whole looks like, with a mix of rich and poor people and di�erent development paths.

�e most interesting aspect of the “Chindia G2” would probably be the end of the idea of material and economicgrowth as the goal of ”development”. We could also get a discussion about where the world can and should go next. We need a global circular economy for that and the two countries that probably have the best opportunity to provide guidance on how this can be done in a practical way

are China and India.Every time I visit China

and India, I see more and more similarities when it comes

to the major challenges. With their roles as global

economic engines, it becomes very important what direction

those engines will move and what fuel they will use. If China

and India start collaborating in a way that shows the world

Korea and Indonesia, all members of the G-20, have increased their ability to in�uence economic outcomes. �e BRICS process has also gained ground. �ese are welcome developments.

At the same time, risks remain for economies which are still developing. An early return to robust growth and spending in the developed world are necessary for world economic recov-ery. �e US, Europe and Japan still ac-count for approximately $20 trillion of consumption expenditure, as against about $2.5 trillion by China and India together. A re-balancing of economic structures in our countries in the face of such di�erences could be di�cult. More generally speaking, the relatively benign external environment in the last two decades is changing negatively and is threatened by protectionism in the developed world.

World politics also faces new chal-lenges. �e balance of power is in �ux in Asia and the world. As uncertainty rises, powers follow hedging strategies. �e mechanisms of strategic communi-cation and consultationand a common security outlook are evolving slower than the changes in objective reality.

Besides, both India and China are increasingly linked to the rest of the world through trade, investment and their Diasporas. �e impact of changes in West Asia on our energy security, for instance, is an example of how devel-opments further away from our shores also a�ect India and China more and more profoundly. It is therefore natural for us to take ever greater interest on global issues. Equally, global issues like climate

INDIA AND CHINA ARE THE LARGEST AND THE THIRD

BIGGEST ECONOMIES IN ASIA. CHINA HAS THE DISTINCTION

OF BEING THE SECOND LARGEST ECONOMY IN THE WORLD. THE TWO COUNTRIES ARE

BUILDING A STRONG DOMESTIC ECONOMIC BASE AND RAPIDLY

TRAINING SCIENTIFIC AND TECHNICAL MANPOWER

change, nuclear proliferation and cy-ber and space security matter more to both India and China in this glo-balised world as they in�uence our development, peace and prosperity. India-China relations

What does this context imply for India-China relations?

Both India and China currently give the highest priority to their do-mestic transformation, which will take time. A peaceful periphery, a stable and benign world environment and contin-ued prosperity among our economic partners are of utmost importance to both of us. �is will remain so for quite some time. It is in our mutual interest to work together, bilaterally and with other partners, to reduce uncertainty and create an international environ-ment that is supportive to our domestic transformation e�orts. Economics and

development are not zero-sum games. It is for this reason that we believe

that there is enough space for both In-dia and China to realise their develop-ment aspirations.

Economically, we are already inte-grated with each other to an unprec-edented extent. Our bilateral trade reached over US$67 billion in the �rst 11months of last year, and China has consistently remained our largest trad-ing partner in goods for several years. However, investment �ows between us have not kept pace with trade. Indian investment in China worth a total of US$ 433million is spread over 676 projects, while Chinese investment in India is worth nearly US$ 300 million. �ere are several opportunities for co-operation in developing infrastructure. India is already one of China’s most important markets for project exports, with a cumulative value of contracted projects at US$ 53.5 billion and turn-over realized at US$ 24.6 billion.

What is less noticed is the range of contact between our two societ-ies. For instance, over 7,000 Indian students are studying in China today. �is scale of interaction never occurred before in history.

Naturally, the corollaries of such an intensi�cation of economic and social engagement are issues of trade imbalance, diversifying the trade bas-ket and commercial disputes. �e two governments have taken several initia-tives to make our trade more balanced and harmonious, and to facilitate and streamline our business engagement. More remains to be done and we will learn by doing. For instance in Septem-


INFOCUS | INDIA-CHINA RELATIONS | EXCLUSIVE

Shiv Shankar Menon

Today India-China relations attract attention beyond our two coun-tries.International developments

and achievements in domestic con-struction by our peoples in the last few decades have given our relationship wider signi�cance.Relations between India and China and their new equi-librium holds an important key to the emerging economic and strategic land-scape of Asia and, to a certain extent, the world.

Let us look brie�y at the context within which we conduct our relations and then look at the content of our re-lations today.

India and China will be able to successfully face the challenges that the new geopolitics are throwing up and would best serve their own national interests by further deepening their strategic cooperative relationship.

Linked like two wings of a bird

INDIA-CHINA STRATEGIC RELATIONS

The Context�e basic facts are evident and well

known. India and China are the two most populous nations on earth, are the two largest developing countries,and are among the societies and econo-mies in the world that are transforming themselves most rapidly. �ey are the largest and the third biggest econo-mies in Asia. China has the distinction of being the second largest economy in the world. �e two countries are building a strong domestic economic base and rapidly training scienti�c and technical manpower. When much of the world is reeling under recession or grappling with political turmoil, our two countries have managed to register

reasonably healthy rates of growth and maintain stability. We share a common geopolitical space and similar socio-economic aspirations for ourselves.

�e future is less certain or evi-dent. Uncertainty in the international system is at unprecedented levels. �e economic and security situation fac-ing both India and China has become far more complicated in the last few years. On the positive side, thanks to sustained growth rates, high savings rates and a prudent �nancial approach, Asia and the developing world have witnessed a greater accretion of relative economic power following the �nan-cial crisis of 2008. In Asia, larger econ-omies like China, Japan, India, South


new issues in the changing context of our relations. I am con�dent that we will do so.

Indeed, some security challeng-es, especially of the non-traditional va-riety, are common to India and China, and o�er an opportunity to work to-gether. Both India and China face the challenge of terrorism in our shared neighbourhood. It requires common e�ort by all members of the interna-tional community to tackle terrorism.

Energy is the key to domestic transformation in both India and China which is why both of us have a common stake in energy security and in the freedom and security of transportation on the global commons. We both have an interest in global public goods like a peaceful order, freedom of the seas and open sea lanes. We similarly need to address issues of piracy with common resolve. As important maritime nations, we can contribute to each other’s maritime security by coordinating approaches.

Asia’s security is interlinked across this great continent. India has therefore argued for an open, inclusive Asian se-curity architecture. India and China will have key roles to play in forging a new compact for common and collec-tive security for Asia. We should also contribute within our capacity to the global public goods that are increas-

and China change fast, our under-standing of each other needs to keep pace. Both the quality and the scale of our interactions have also grown so rapidly that we need to learn new ways of dealing with therelationship. Conclusion

To conclude, India and China have demonstrated an ability to deal with dif-�cult issues and to build a cooperative partnership based on common inter-ests. Its regional and global impact, and its long term signi�cance to our own development, is what makes the India-China relationship strategic in the true sense of the term. I do hope that I have been successful in giving you some idea of why I am con�dent that by working together India and China will be able to successfully face the challenges that the new geopolitics are throwing up, and would best serve their own national interests by further deepening their strategic cooperative relationship.

THE BOUNDARY QUESTION REMAINS

UNRESOLVED, AND THERE IS NO DENYING THAT IT IS A

DIFFICULT ISSUE. HOWEVER, A NUMBER OF MECHANISMS HAVE BEEN PUT IN PLACE TO ENSURE THAT THE BORDER STAYS PEACEFUL WHILE WE SEEK A SETTLEMENT OF THE

BOUNDARY QUESTION. ingly important to our well being. �e robustness of our bilateral rela-tion will depend on dialogue and com-munication so that the potential for misunderstanding and miscalculation is limited. �is dialogue process must not be limited to the two Govern-ments. Today, there are multiple stake-holders in our relations as also multiple determinants of these relations. Each of them, be it businessmen, media or scholars of the two countries, has a responsibility to take our relations to the desired level of equilibrium. It is therefore absolutely essential that they acquire an informed understanding of their neighbour.Today, as both India

�is is the speech delivered by Mr. Shiv Shankar Menon (National Security Advisor, Govt. of India)

at a lecture on China-India relations


ber last year we held the �rst Strategic Economic Dialogue between India and China which identi�ed several areas of promise for the future. Equally the business communities and their Cham-bers need to take advantage of growing opportunities while sharpening com-petitive edge. I am convinced that our business and economic engagement with each other and with other coun-tries will intensify as we seek to over-come the prospect of sluggish recovery in the traditional engines of growth in the world economy.

Our Governments have common or similar positions on the global development agenda, in WTO and on climate change, which has made it possible for us to work together internationally.

A few vocal experts in our two countries and elsewhere argue that notwithstanding the numerous coop-erative elements in our economic rela-tions and approach to international is-sues, India and China are bound to be strategic adversaries. I �nd such deter-minism misplaced. It ignores the suc-cessful experience and demonstrated expertise of both governments in man-aging di�erences and building on com-monalities for over three decades and particularly since the Rajiv Gandhi vis-it to China in 1988. It also ignores the wisdom of the leaders of the two coun-

tries, who have consistently worked to ensure that problems are managed in a mature manner. �e issue is whether we can continue to manage the elements of competition within an agreed stra-tegic framework which permits both of us to pursue our core interests. I see no reason why that should not be so. Indeed I would go further and say that the rapid changes in the international situation today also create an opportu-nity for India and China to work with others to shape benign international outcomes.

�e boundary question remains un-resolved, and there is no denying that it is a di�cult issue. However, a number of mechanisms have been put in place to ensure that the border stays peace-ful while we seek a settlement of the boundary question. On the settlement itself, we are in the second stage of the three stage process of agreeing principles, a framework and �nally aboundary line.

Similarly, on other bilateral issues of potential di�erence there exist mecha-nisms of dialogue and communication to address them. We appreciate China’s assistance to us in tackling �oods and natural disasters in the downstream ar-eas of our shared rivers. �ere is a need to widen the scope and deepen the level of our communication in some areas.�ese include new challenges and

ECONOMICALLY, WE ARE ALREADY INTEGRATED

WITH EACH OTHER TO AN UNPRECEDENTED EXTENT. OUR

BILATERAL TRADE REACHED OVER US$67 BILLION IN

THE FIRST 11MONTHS OF LAST YEAR, AND CHINA HAS

CONSISTENTLY REMAINED OUR LARGEST TRADING PARTNER IN

GOODS FOR SEVERAL YEARS.

WHAT IS LESS NOTICED IS THE RANGE OF CONTACT BETWEEN OUR TWO

SOCIETIES. FOR INSTANCE, OVER 7,000 INDIAN

STUDENTS ARE STUDYING IN CHINA TODAY. THIS SCALE OF INTERACTION

NEVER OCCURRED BEFORE IN HISTORY.




Minister Manmohan Singh respectively during BRICS Summit in China and the East Asia Leaders Meetings in Indonesia. Two sides had in-depth discussions on issues of mutual interest and rea�rmed commitments to deepening the strategic and cooperative partnership.

SECOND Provincial and state level ex-

changes have become new highlights of bilateral relation. Successful visits by Governors of Sichuan, Guangdong and Gansu provinces and Chairman of Xinjiang Autonomous Region of China to India and Chief Ministers of Bihar and Gujarat of India to China produced positive results in economic and cultural cooperation, bringing the local governmental cooperation into the overall picture.

THIRD Economic and trade cooperation main-

tained a robust growth and becomes a salient feature of our bilateral ties. China-India two-way trade in 2011 has touched new height. According to the estimation, during the 11 months of this year the trade volume reaches 67 billion USD, up 21.8 per cent year on year and is expected to exceed 70 billion USD for the whole year. �e �rst branch o�ce of Industrial and Commercial Bank of China opened in Mumbai last year, marking a new mile-stone in �nancial cooperation. To settle the trade account in RMB and Rupee is another important move by two coun-

I HAVE SENSED A GROWING CONSENSUS VIEW IN FAVOUR

OF DEVELOPING A SOUND AND MUTUALLY BENEFICIAL

RELATION WITH CHINA AMONG ALL POLITICAL PARTIES

AND GENERAL PUBLIC IN INDIA. FROM THE CHINESE SIDE, TO BUILD A STABLE

AND MUTUALLY BENEFICIAL RELATIONSHIP WITH INDIA IS THE SET POLICY OF THE CHINESE GOVERNMENT.

tries to facilitate bilateral economic co-operation. Mutual investments are also gaining new momentum. One recent example is TBEA Corporation, the largest special transformer producer of China, has signed a 400-million USD agreement with an Indian company to invest in Gujarat to put up a factory for manufacturing transformers for power projects in India.

FOURTH New headway has been made in institu-

tionalization of bilateral cooperation. �e newly established China-India Strategic Economic Dialogue held its �rst round meeting in Beijing Septem-ber last year. China-India CEO Forum

is also in the making. At the same time, the existing mechanisms such as the ��h China-India Financial Dialogue, the fourth China-India Defense and Security Talks and consultation on counter terrorism were successfully held in Delhi and Beijing last year. �ese new and old mechanisms have helped to enhance mutual trust and deepen economic cooperation between two countries.

FIFTH Cooperation on interna-tional and regional issues

has acquired new momentum. Two countries maintained close consulta-tion and worked vigorously within the framework of UN, WTO, G20 and BRICS on issues such as climate change, reform of international �nan-cial institutions, Doha Round Trade Talks as well as issues related to the sit-uation in West Asia and North Africa. Two countries have played construc-tive role in the proper settlement of rel-evant issues and defending the interests of developing countries.

SIXTH People-to-people ex-change has added new vi-

tality to our relation. �e 500-member Indian Youth delegation visited China last September and was warmly re-ceived by Premier Wen Jiabao in the Great Hall of People. �e Year of Ex-change was successful and colourful. Events like “Treasures of Ancient Chi-na” exhibition, Sichuan Week, Yunan Acrobatics Troup performance and cultural activities like “A Grand Stage



Zhang Yan

To begin with, I would like to have a glimpse of the past year �rst.

2011 is no ordinary year for China-India relation. In spite of the complicated international and regional situation, our bilateral relations

No force in the world can stop China, India from rising together

MUST SHED HISTORICAL BURDEN, MUST COOPERATE

maintained a sound and steady growth with cooperation and interactions unfolding in an all-round manner. We have also successfully concluded the Year of China-India Exchange announced by two sides during the Chinese Premier Wen Jiabao’s visit to India in December, 2010. To take stock of the year, we have seen a

cluster of positive developments in our bilateral relations.

FIRST Active high level interactions have visibly

enhanced our mutual understanding and trust. Last year, Chinese President Hu Jintao and Premier Wen Jiabao had fruitful meetings with Indian Prime


reform of international economic and �nancial governance as well as in the global economic recovery. Facing with similar challenges and historical tasks, China and India are complimentary to each other and enjoy certain degree of synergy. �e two countries are part-ners of cooperation, and partners for growth and prosperity. China’s devel-opment provides opportunity to India, so does India’s development to China.

FOURTH China-India relation has matured. We are

fully aware of the fact that there are dif-ferences and challenges le� over by his-tory. But we know much better how to manage them. We are keenly aware that cooperation between the two countries bene�ts both and confrontation only hurts each other. As two Asian neigh-bours and fast growing economies, China and India share more common interests than di�erence. Both have adopted a “looking forward” approach and are trying their best not to let the historical burdens to stand in the way of our cooperation. When we are fac-ing problems, we are now more than willing to engage each other in dialogue and consultation to di�use the risk. As to the perceived competition between the two countries, so long as it is a fair and friendly one, we also look at it in a positive way. As Indian Prime Minister

Mamnohan Singh and Chinese Pre-mier Wen Jabao pointed out that the world is large enough for both China and India to develop and prosper. And there is enough room for two countries to cooperate.

Here I must point out that not ev-ery country in the world is happy to see China and India getting closer and prospering together. Some even try to drive a wedge between us. I must point out again, that China and India’s ris-ing together is an irreversible historical trend that no force in the world can stop. In spite of all kinds of prophecies

with ill-intention, China-India relation takes its own course and moves ahead because the two countries know where their national interests lie and how to handle their relations. Our cooperative relation poses no threat to others and is not developed at the expense of other countries’ interests.

2012 has arrived and the traditional Chinese New Year, the year of dragon will come soon. In Chinese culture, it is the most auspicious time to plan. As the Chinese saying goes, a good beginning is crucial to a successful year. In order to push the bilateral relations forward, we should join hands and work in the following areas.

FIRST e�orts should be made to further increase political

trust and enhance strategic cooperation. Political trust is the very foundation of any bilateral relation. To achieve this, two sides should maintain the sound

AS TWO ASIAN NEIGHBOURS AND FAST GROWING

ECONOMIES, CHINA AND INDIA SHARE MORE COMMON INTERESTS THAN DIFFERENCE.

BOTH HAVE ADOPTED A “LOOKING FORWARD”

APPROACH AND ARE TRYING THEIR BEST NOT TO LET THE

HISTORICAL BURDENS TO STAND IN THE WAY OF

OUR COOPERATION.

Prime Minister Manmohan Singh speaks at the BRIC Summit in Brasilia, Brazil. President of Russian Republic Dmitry Medvedev (R), President of Brazil Luiz Inacio Lula Da Silva and President of China Hu Jintao look on



for China-India Youth Traditional Culture Exchange” were organized in India and China respectively, creating cross-culture dialogues between two ancient civilizations. China has also provided �nancial support to the re-construction of Nalando University.

�e performance of our relationship in the year 2011 is impressive and fruitful. More importantly, it has demonstrated the following salient features.

FIRST China-India relation is anchored on a more

solid political base than before. It is encouraging to see that the leaders of two countries have viewed our relations from a long-term and strategic perspec-tive. �ey have given increasing impor-tance and attention to our relationship which provides strong political founda-tion for the development of our bilater-al relations. Furthermore, I have sensed a growing consensus view in favour of developing a sound and mutually bene-�cial relation with China among all po-litical parties and general public in India. From the Chinese side, to build a stable

and mutually bene�cial relationship with India is the set policy of the Chi-nese government. President Hu Jintao stated on many occasions that India is an important neighbour of China. China is ready to work with India to maintain the sound momentum for further advancement of the China-In-dia Strategic and Cooperative Partner-ship and for the common interests of two countries.

SECOND China-India rela-tion has become

more substantive. Both countries pur-sue an independent foreign policy and share growing common interests. To-day, China-India relation is developing in a comprehensive manner and has acquired strategic signi�cance. Both countries not only enjoy growing co-operation in economic �eld, but also work closely in political and security �elds, brining tangible bene�ts to our people. On issues directly a�ecting our interests as well as global situation, such as climate change and issues relat-ed to the West Asia and North Africa, two countries worked constructively and e�ectively to defend the interests and rights of our two countries as well as that of all developing countries.

THIRD China-India relation holds great potential. As

two fast growing economies, China and India provide opportunities to each other. In spite of the �nancial and debt crisis in US and Europe, China and India enjoy stability domestically and boast a relatively rapid economic growth. With 2.5 billion populations, huge markets and rich human resourc-es, China and India are regarded by the international community as pow-erhouse for world economy and are expected to play a bigger role in the

FACING WITH SIMILAR CHALLENGES AND HISTORICAL

TASKS, CHINA AND INDIA ARE COMPLIMENTARY TO EACH OTHER AND ENJOY

CERTAIN DEGREE OF SYNERGY. THE TWO COUNTRIES ARE

PARTNERS OF COOPERATION, AND PARTNERS FOR GROWTH

AND PROSPERITY. CHINA’S DEVELOPMENT PROVIDES OPPORTUNITY TO INDIA,

SO DOES INDIA’S DEVELOPMENT TO CHINA.

Chinese Premier Wen Jiabao during the India-China Business Co-operation Summit in New Delhi


actively considered. FTA and RTA are useful instruments to facili-tate and boost bilateral trade in a bigger way. As a �rst step, the two countries can work on a regional trade arrangement and at the same time prepare the ground for a full-�edged FTA.

5. E�orts should be made to increase

tourism cooperation. With a large population and rich tourist resourc-es, the two countries possess great potential to become major tourist destination for each other. Regret-tably, last year altogether only 600 thousand tourists travelled between the two countries. Compared with 16.5 million between China, Ja-pan and Korea, the �gure between China and India is too small. I am of the view that more Chinese tour-ists to India can also help narrow the trade gap of our two countries.

THIRD Emphasis should be placed on expanding

people and culture exchanges. People-to-people exchange serves as a cornerstone of state-to-state relations and can play crucial role in minimizing the so-called “trust de�cit”. �e Chinese side will work with the Indian side to continue the annual youth exchange programme and expand the exchanges of journalists, media and think-tanks. Cross-cultural exchanges can enrich the knowledge of each other and foster closer ties among peoples. We are ready to provide assistance in Chinese language teaching in Indian secondary schools. And Indian students are most welcome to study in China. We will continue to lend our support to the revival of the Nalanda University.

FOURTH e�orts should be made to enhance

our regional and international coop-eration to promote common interests. We should step up our coordination and cooperation on regional and in-ternational issues and work together to address the challenges of global impli-cations such as climate change, food se-curity, energy security, reform of global �nancial system, counter terrorism etc. to ensure those issues will be handled

in line with the interests of developing countries and in a fair and equitable manner. China and India also should promote the rights and increase the say of developing countries in the global decision-making process.

FIFTH properly manage sensitive issues and di�erences. Mu-

tual understanding and mutual accom-modation are crucial in dealing with di�erences and disagreements in our relations. We should handle them from a long-term and strategic perspective. So long as we follow the spirit of equal-ity and mutual respect, we will be able to ensure a stable and healthy bilateral relation. It is China’s policy to maintain good neighbourly relations with all its neighbours, including India. We wel-come India to play a more active role in international and regional a�airs. We are happy to see the recent improve-ment of relations between India and its neighbours. A stable South Asia is not only a blessing to China and India, but also a great contribution to the region and the world at large. With the joint e�orts of our two countries, the situa-tion along the China and India border area is on the whole peaceful. E�orts shall be made for a good preparation

EFFORTS SHALL BE MADE FOR A GOOD PREPARATION

FOR THE 15TH SPECIAL REPRESENTATIVES MEETING ON

THE CHINA-INDIA BOUNDARY ISSUE. IN ORDER TO MAINTAIN THE PEACE AND TRANQUILITY OF THE BORDER AREA BEFORE

THE FINAL SETTLEMENT OF THE ISSUES IS FOUND, IT IS

NECESSARY FOR TWO SIDES TO WORK OUT A NEW MECHANISM

TO SERVE THAT PURPOSE. WE ARE WILLING TO WORK WITH

INDIAN SIDE TO ACHIEVE THAT IN THE NEAR FUTURE.

for the 15th Special Representatives Meeting on the China-India boundary issue. In order to maintain the peace and tranquility of the border area be-fore the �nal settlement of the issues is found, it is necessary for two sides to work out a new mechanism to serve that purpose. We are willing to work with Indian side to achieve that in the near future.

China has also declared to the rest of the world on many occasions that it takes the path of peaceful development and is committed to upholding world peace and promoting common development and prosperity for all countries. To this end, China has stuck to an independent foreign policy of peace. As President Hu Jintao rea�rmed in his New Year address few days ago, that China will continue to advance our opening-up drive for win-win results, and will unswervingly stick to the path of peaceful development and independent foreign policy of peace. We will develop our friendly relations and mutually bene�cial cooperation with various countries in the world following the Five Principle of Peaceful Coexistence. An open and harmonious China of prosperity and stability will make an even greater contribution to the whole world.

Mr Deng Xiaoping and Prime Minister Rajiv Gandhi, two great visionary leaders of China and India, shared a consensus view during their historical meeting in 1988 that China and India together can give the world new perspectives on a new international order and that the Asian age will arrive only when both China and India developed. Today the evolution of the world situation has proved their far-sightedness and outstanding vision. China and India are on their way to translating their vision into reality. What shall we do now? �e answer is clear and simple. �at is to cooperate. With the joint e�orts of China and India, we will not only create a brighter future for our two countries and two peoples, but also make fresh contribution to the world peace and prosperity.

(�is is a speech by HE Zhang Yan, Ambassador of the People’s Republic of China

at a lecture on China-India relations)



momentum of high-level exchanges and interaction. Fully utilizing all existing mechanisms to enhance the con�dence and minimize the suspicion and distrust. �is year India will play host to the BRICS’ Summit. We should do our utmost to make the best preparation to ensure a successful and fruitful summit, thus giving positive impetus to the cooperation of �ve countries as well as to China and India relation. I can assure you that China will closely coordinate and cooperate with India to ensure its success.

SECOND more work should be done to up-

grade our economic cooperation. �e global economy will remain uncertain at least for some time. China and India should optimize our own potentials and ensure healthy development of our respective economy. We should strive to meet the trade target of 100 billion USD by 2015 set by our leaders. �e Chinese side is fully aware of the neces-sity to narrow the trade gap between the two sides in order to ensure the sustainability of bilateral trade coop-eration. China will take measures to increase the import of Indian products which have market demand in China. But our cooperation should not be limited in trade only. To deepen our economic cooperation, there is much room for us to explore. Here I will just provide some food for thought.

1. China and India should diversify trade structure, expand the scope and items, and increase the techni-cal content and added value to the products. At the same time, coop-eration should be expanded into �nancial, service and investment sectors.

2. China and India should initiate policy dialogue and coordinate our economic development strategy in order to ensure steady growth of our respective economy. China started its 12th Five Year plan last year. �is year India will launch its 12th Five Year plan. We should exchange our experience and methods in changing the mould of development, readjusting the

economic structure and building an environmentally friendly and inclusive economy, with a view to achieving the best results in our economic development.

3. Mutual investments should be en-couraged. China welcomes Indian companies to invest in China and is willing to encourage more Chinese companies, especially private com-panies to come and invest in India. We hope the Indian side will make additional e�orts to create more conducive environment for foreign investors, especially the visa service. Two countries also can explore the possibility of jointly investing in third countries.

4. Free trade agreement or region-al trade arrangement should be

I MUST POINT OUT THAT CHINA AND INDIA’S RISING

TOGETHER IS AN IRREVERSIBLE HISTORICAL TREND THAT NO FORCE IN THE WORLD CAN

STOP. IN SPITE OF ALL KINDS OF PROPHECIES WITH ILL-INTENTION, CHINA-INDIA RELATION TAKES ITS OWN

COURSE AND MOVES AHEAD BECAUSE THE TWO COUNTRIES KNOW WHERE THEIR NATIONAL

INTERESTS LIE AND HOW TO HANDLE THEIR RELATIONS.

april 2012 India-China Chronicle |55||54| India-China Chronicle april 2012

PHOTO FEATURE

Ringing in the New

REPUBLIC DAY & CHINESE NEW YEAR

It was a unique celebration – the combining of two joyous occasions

�nding expression in one.In Gujarat, the 26th day of

this year was celebrated as not only the Republic Day of India but also the Chinese New Year to strengthen India-China relations. �e celebrations were jointly organized by the India China Economic & Cultural Council (ICEC), Gujarat Chapter, and the Culture department of the Embassy of China in India and CCTV.

�e Chief Minister of Gujarat, Mr Narendra Modi, wished the gathering “A Happy Chinese New Year” via video message.

�e celebrations were inaugurated by Mr Zhang Zhihong, Cultural Counselor, Embassy of China, Ms Fang Wen, cultural o�cer, Embassy of China, Mr Bakul Bakshi Retd Chief Commissioner Customs & Central Excise and Mr Jagat Shah, Chairman ICEC, Gujarat. �e Karnavati Club was the venue where a photo exhibition on the Beijing Opera, an authentic Chinese food festival, a quiz on India and China, trade & culture information, kite festival and a demo of Chinese language learning were held to mark the occasion. People from all over Gujarat – Ahmedabad, Baroda, Surat, Rajkot, Junagadh, Bhuj and Jamnagar gathered to take part in the celebrations. Several government o�cials also attended. All visitors were greeted with the traditional red Chinese welcome scarf and handed a red envelope with a gi� which are an integral part of the Chinese New Year. A “laughing Budha” was also gi�ed to

all for good luck & fortune. More than 400 people took part

and le� with an awareness of the many similarities that the two great countries had in common. A quiz on China was also held and the Chinese were surprised by the knowledge exhibited by the Indians present who won all the prizes. “We must �nd more di�cult questions for these Gujarati brains,” Mr Zhang Zhihong, Cultural Counselor, joked in a lighter vein.

Several Chinese visitors and exchange students from China in Gujarat also attended and participated in a quiz on India’s Republic Day. �ey too won several prizes.

�e usual lion dance and dragon dances to mark the Chinese New Year were screened. Two popular Chinese �lms were also screened – Let’s Fall in Love and Forever Enthralled. Some quick and easy tips were also shared with the audience on: How to use chopsticks, the traditional method of

making Chinese tea, and How to cook authentic Chinese haka noodles etc.

As part of the celebrations, the Chinese delegation visited many historic sites in Gujarat such as the Adalaj step wells, the Sardar Patel memorial, Akshardham temple, Sarkhej Roza, Jhulta minar, Sidi Saiyed ni jali, Hutheesing Jain temple and the Sabarmati ashram. �ere were also exchanges on Indian & Chinese culture with students from PDP University.

Ms Fang Wen showed interest in organising opera shows, lion dances and dragon dances during Diwali later this year and during Vibrant Gujarat in January 2013. Mr Zhang Zhihong too expressed interest in facilitating sports trainers for the sports university mooted by Chief Minister Narendra Modi.

�e entire celebrations were covered by CCTV, China’s national TV .


EXHIBITION DATE VENUE EVENT PROFILE CONTACT PERSON

1 China (Qingdao) Garments & Textiles Export Fair

04 -06 May-12

Qingdao International Convention & Exhibition Center, Qingdao, China

China (Qingdao) Garments & Textiles Export Fair (Autumn) and 2012 China (Qingdao) Home Textiles & Fabrics Export Fair are the most important textiles & garment export fair in North China and to be held from 04 to 06 May 2012 at Qingdao International Convention & Exhibition Center in the China

Mr. Wan JifeiTel: +86-532-82772668

2 Nuclear Power Industry Exhibition

07- 09-MAY-12

TBA, Shenzhen, Guangdong, China

Nuclear Power Industry Exhibition is a specialized event demonstrating industrial potential of foreign enterprises for manufacture of complex industrial products as well as a wide range of technologies and services for providing full-scale radiation safety of the states.

China Nuclear Energy Association, CNEA

Tel: +(86)-(10)-88305809

3 Biotech China 09- 11-MAY-12

Shanghai World Expo Theme Pavilion, Shanghai, China

Biotech China is the only international exhibition in China that focuses on biomedicine, gene technology and life science. Biotech China has become the well known and highly professional expo in this particular �eld with widely acknowledged fame in both China and the whole Asia region.

Shanghai Modern International Exhibition Co. Limited

Ms. Alfred Wang Tel: +86-21-63288899

4 International Photovoltaic Power Generation Conference & Expo

16- 18-MAY-12

Shanghai New International Expo Centre(SNIEC), Shanghai, China

International Photovoltaic Power Generation Conference & Expo is characterized as one of the de�nite show for Photovoltaic Power Generation. For 3 days, it will showcase world’s largest Photovoltaic industry. A conference will also be held along with the event which will give a complete snapshot of the sector.

Shanghai New Energy Industry Association

Mr. James JiangTel: +86-21-13651766051

5 China International Tourism & Investment Real Estate Trade Fair

25- 27-MAY-12

Shanxi Province Exhibition Hall, Taiyuan, Shanxi, China

The trade fair will aim at catering to the requirements of the industry members as well as the commercial and non commercial visitors about the latest developments and advancements in the �elds of international travel and tourism with focus on the role of real estate investment.

Shanxi Sanjin Exhibition Service Co., Ltd

Mr. Jason YangTel: +86-351-5249513

6 Rail & Metro China Expo

30- 01-JUN-12


Metro China is the premier international trade event in the urban rail industry in China, which has been successfully held since its �rst launch in 2002. It serves as an ideal platform for companies in the industry to collect market information, establish business contacts, to take advantage of the great opportunity o�ered by one of the most vigorous economies in the world.

IMAG, GermanyTel:+(49)-(89)-94922121

7 Green Processing China

06- 08-JUN-12


The Green Processing China 2012 event will be the renowned exhibition which will focus on the key elements which is intended to a cleaner environment. It will o�er a vast horizon with excellent business platform for scrap metal dealers.

Reed Exhibitions China Head O�ceMr. Ken XuTel: +86-10-59339317

8 China Auto Parts and Service Show

12-15-JUN-12

Shanghai New International Expo Centre(SNIEC) Shanghai, China

China Auto Parts and Service Show is one of the most professionally organized automobile sector trade shows in China. Organized at the Shanghai New International Expo Center, the show serves as an ideal platform for leading industrial experts from this sector to deliberate upon the latest developments and innovations from this sector.

Shanghai International Exhibition Co LimitedTel: +(86)-(21)-62792828

9 NEPCON West China 19- 21-JUN-12

Chengdu New International Convention & Exposition Center, Chengdu, Sichuan, China

NEPCON West China is an event dedicated to the sector of electronics manufacturing. This event will be extremely bene�cial for the exhibitors as it is in this event that they will be provided with excellent marketing opportunities by being able to introduce their latest products and services to the attendees

Reed ExhibitionsMr. Mike DengTel: +86-21-51535100

10 Global Sourcing Fair : Electronics & Components Shanghai

26- 28-JUN-12

Shanghai World Expo Exhibition And Convention Center, Shanghai, China

Electronics & Components Shanghai is a fabulous event bringing together the experts and decision makers from the electronics and components industries in to contact with the consumer businesses as they look to expand their trading options further along with a better professional understanding of the discipline itself.

Global SourcesTel:+(65)-(6547)-2800

11 China(Shenzhen) International Touch Screen Exhibition

28- 30-JUN-12

Shenzhen Convention & Exhibition Center, Shenzhen, Guangdong, China

The Huiduo Touch-Screen Exhibition will attract over 200 manufacturers to join in. Besides, the number of booths will be up to more than 500 and the area of exhibition will exceed 10 thousand square meters.

Huiduo Exhibition Co. LimitedMr. Anna YuTel: +86-20-85556058

ShowsExhibitions&TradeIn India In China


EXHIBITION DATE VENUE EVENT PROFILE CONTACT PERSON1 India International

Medical Equipment Expo Hyderabad

04- 06-MAY-12

NSIC Trade Centre - ECIL, Hyderabad, Andhra Pradesh, India

It is one of the most professionally organized healthcare sector trade events in India. The show focuses on the overall development of the domestic medical industry and a diverse range of biomedical supplies, catheters, laser surgery tools, imaging machinery, blood transfusion sets and other highly useful pharmaceutical systems and accessories are exhibited here.

Paramount ExhibitorsMr. Harish AroraTel: +91-172-2274801

2 Greentech Fire Safety & Security Global Conference & Expo

17- 18-MAY-12

TBA, Visakhapatnam, Andhra Pradesh, India

This event o�ers the best place for buyers & sellers and opportunities for :Joint ventures and collaborations, Sourcing requirements, Transfer of technology, research & development, Investment opportunities, Supply of plant, machinery, process control equipments, projects, services etc.

Greentech Trade Fairs Private LimitedMr. Kamaleshwar SharanTel: +91-11-25593846

3 FUTURE NOW 18- 20-MAY-12

Bombay Exhibition Center(BEC), Mumbai, Maharashtra, India

FUTURE NOW is a stellar event bringing together the best brains and top experts in the information technology industry in discussion over the current trends in the profession as well what the future direction might be

India-Tech FoundationMr. Sanjay MishraTel:+(91)-(22)-26605550

4 Cloud Connect Bengaluru

24- 25-MAY-12

Nimhans Convention Centre, Bengaluru, Karnataka, India

This show will provide the perfect platform for the exhibitors to establish new business relationships with a number of prospective clients at the same time nourish old business contacts. Large number of national and international buyers along with foreign delegates will attend this business fair and will purchase products according to their requirement and budget.

UBM India Pvt. Ltd.Mr. Anees AhmedTel: +91-11-23765551

5 Fabrics & Accessories Trade Show

01- 03-JUN-12

Gayathri Vihar Palace Ground, Bengaluru, Karnataka, India

This is India’s premier platform for the textile value chain. The 8th Edition of this show will provide manufacturers and suppliers of apparel, fabrics, trimmings, embellishments and related services to showcase their merchandise to discerning buyers from across the world. F & A Trade Show has emerged as the most important international sourcing platform in India, which is used by big buyers.

SS Textile Media Private LimitedMs. Kavita Tel: +91-80-25544711 / 41151841

6 The Wedding & Lifestyle Fair Worli

13-13-JUN-12

Blue Sea, Mumbai, Maharashtra, India

This fair has raised the expectations of Mumbai residents as the event is going to be a promising show of luxurious wedding trousseaus, services and lifestyle products without which a wedding is never complete. Addressing various requirements of visitors, planning to get married in the upcoming season, this event will showcase some of the �nest collections from eminent designers having loads of expertise in wedding couture.

Marriage MantraMr. Aanal MehtaTel: +91-022-26469120

7 Electrical, Electronics And Energy Expo And Conferences - Coimbatore

15-17-JUN-12

Codissia Intec Technology Centre, Coimbatore, Tamil Nadu, India

Electrical, Electronics And Energy Expo And Conferences Coimbatore will explore a whole new world of electronics and energy. This event will be showcasing a wide range of products, services and technologies that pertain to these respective sectors.

Paramount ExhibitorsMr. Harish AroraTel: +91-172-2274801Mob: +91-9814211848

8 Food & HospitalityWorld

21-23-JUN-12

Palace Grounds, Bengaluru, Karnataka, India

Over the span of last 8 years since its inception in 2000, Food & HospitalityWorld has established itself as India’s most comprehensive hospitality tradeshow. The event is organised under the banner of ‘The Express Groups’ premier hospitality trade publication - Express Hospitality - a publication that enjoys the status of Indian hospitality industry’s favorite business magazine.

The Indian Express Ltd.Ms. Darshana ChauhanTel: +91-22-67440000

9 Baicon 29 Jun- 1 Jul 2012

Chennai Trade Centre Chennai, Tamil Nadu, India

Baicon is one of the most reputed trade shows for the construction industry. This event will be an extensive display of the latest and the most advanced equipments, machinery, technologies and materials that are related to the construction sector. Leading companies will be exhibiting their most innovative products and services that are related to the concerned sector.

Smart ExposTel: +91-44-22501986 / 22501987

10 Photo Today Bangalore

29-JUN-to 01-JUL-12

Palace Grounds, Bengaluru, Karnataka, India

The Photo Today is characterized as an international exposition for tapping global opportunities of photography, videography, digital imaging frame & album making industrial sector. The place proves to be an ideal optimum choice for bringing all premiere companies under 1 roof.

Buysell Interactions Private LimitedMs. Karthika Ravi Tel: +91-44-28353739Mob: +91-9884348473

11 India International Travel Exhibition - Aurangabad

29-jun 01-JUL-12

TBA, Aurangabad, Bihar, India

India International Travel Exhibition (IITE) is the leading organizer of Travel and Tourism events in the fastest growing tier two cities of Central India. IITE has successfully completed its events at Indore, Aurangabad, Raipur, Nagpur & Vijayawada.

Global Trade Fairs & Conventions (GTFC)Mr. Anurag GuptaTel:+(91)-(80)-41483066


These mysterious towers pepper the Tribal Corridor of Western Sichuan province.

Hundreds still stand—some 50 meters high with as many as 13 star-like points—and the oldest are thought to be 1,200 years old.

Nobody knows why they’re there or what they’re for, but some say they were defensive structures used for observing the lawless valleys that surround them. Others suggest they could have been used as status symbols, or storehouses, or both. Regardless, these secret towers of the Himalayas are one of China’s best kept secrets.

The Tibetan towers of Western Sichuan

China’s wild rivers

China is home to some of the mightiest rivers in Asia—the Yellow, the Yangtze, the Mekong—and for many, the

country’s massive damming projects are a tragedy. But Chi-na is still home to some unspoiled waterways that can o�er glimpses of the country rarely seen.

Last Descents River Expedition, run by a young American trying to protect China’s river heritage, can lead the way. �e company organizes trips to rivers in Western China—includ-ing Tibet, Qinghai and Yunnan—that combine tourism with a social and environmental purpose.

Heaven Lake, home to China’s Nessie

Since the beginning of last century the Heaven Lake Monster has made several

alleged ‘appearances’. In 2003, a group of soldiers claimed to have spotted a black and green animal with scales on its back and horns on its head. In 2007, a TV cameraman supposedly caught video and stills of three pairs of �nned, seal-like creatures that “could swim as fast as yachts.”

Monster or not, Heaven Lake is a marvel. �e volcanic lake in Jilin province was con-sidered holy land during the Qing dynasty. From the top, catch a rare glimpse of North Korea just across the border.

INFOCUS | INDIA-CHINA TOURISM | REPORT


Glacier lakes, mountain forests, sandy beaches and more. Here’s a list of some dramatic destinations that you may not have yet considered for your trip to China:

There’s a whole lot more to China than an expo, cheap food and a big wall. Book a train or some plane tickets and check out some of these other Chinese spectacles.

10 places to see in China that aren’t the Great Wall

Karakul, a glacier lake 3,600 meters above sea level tucked in the Pamir Mountains, feels like the edge of the Earth. Along the Karakorum highway and a stone’s throw from the Tajikistan border, Karakul is home to camels, yaks,

Kyrgyz herders and not much else. �e walk around the lake (Karakul means “black lake” in Kyrgyz) takes about three hours and o�ers a spectacular view of the 7,500 meter high Muztagh Ata Mountain.

Many visitors spend the night in a yurt belonging to a local family. For about US$10 a night, you’ll be fed rice, veg-etables and yak meat and sleep in a collective bed heated by a small �re pit. Dress warm.

Karakul Lake, Xinjiang


Cuandixia village, Beijing

Beijing is great, but sometimes you just need to escape. It’s not hard. Just outside the city are some charming

villages tucked in the lovely hills to the west, many in the shadow of the Great Wall.

Cuandixia village, about 90 kilometers from down-town Beijing, is more than 400 years old and is home to more than 70 preserved courtyard homes built during the Ming (1368-1644) and Qing (1644-1911) Dynas-ties. It’s o�en a stand-in for ancient China in �lms and TV shows. �e nearby hills are green and lush, a con-trast to the dusty landscape that surrounds the capital. Cuandixia makes for a good day trip and home stays can also be arranged.

Surf in Hainan

Hainan Island, sometimes called, perhaps generously, “China’s Hawaii,” is a growing tourist destination

o� the country’s southern coast, just east of Vietnam. It’s famous for hosting Chinese beauty pageants, but is also home to a small but growing community of surfers – both Chinese and foreign. Each November, Sanya, the island’s capital, hosts the second annual Sur�ng Hainan Open. Check out Hainan Adventures for surf lessons and travel packages.

Gulangyu Island

Every visitor to China has a car story—or several (see Peter Hessler’s Country Driving)—and rarely are they

positive. Gulangyu, an island o� the coast of Xiamen, might be the only place of true calm le� in today’s auto-obsessed China.

Gulangyu, home to 16,000 people on one square kilo-meter of land, famously has no motorized vehicle (with a few exceptions). Not even bicycles. No honking, no traf-�c jams, no near-death experiences. Can this place even be called China? �e hilly island is part Old Havana, part Hawaii – a pedestrian’s dream.

INFOCUS | INDIA-CHINA TOURISM | REPORT


Burma Road, Yunnan

The Burma Road once ran from Mandalay to Kunming and was the scene of bloody battles during World War

2. On the Chinese side, start in Riuli, once known as a Golden Triangle hub, today home to several jade markets. Pass by spectacular valleys and terraced rice plantations on the way to Tongsheng, which is home to the Museum of Yunnan-Burmese Anti-Japanese War.

Before heading to Dali, spend a few days hiking through unspoiled villages along the southern portions of the Nu River. Once in Dali relax in one of the Old City’s myriad cafes before heading to Kunming, Yunnan’s capital and one of China’s coolest cities.

Guangzhou’s Little Africa

Tucked into the heart of Guangzhou’s Old City is one of the most fascinating corners of China you didn’t know existed: A

community of some 20,000 traders hailing from Nigeria, Senegal, Ghana and elsewhere in Africa.

Situated near Canaan Export Clothes Wholesale Trading Center, Little Africa, or “Chocolate City,” as some politically incorrect locals sometimes call it, arose in the 1990s as traders �ocked to the southern Chinese province nicknamed ‘the world’s factory.’ Vibrant social and religious communities have developed and many traders will gladly talk with visitors about their lives—both the good and bad—in Guangzhou.

Early last century, wealthy foreigners living in Shanghai came to Moganshan to lounge away the summer in stone villas,

play tennis and swim in the municipal pool. Today, Moganshan is making a comeback, thanks in part to Naked Retreats, a col-lection of restored farmhouses. (Don’t be fooled by the name – any nudity should probably be con�ned to your bungalow.)

Upon arrival, guests are taken on a ‘decompression walk’ and encouraged to spend a few minutes in awe of the scenery. Activi-ties include cycling, bass �shing and mountain hikes. Visitors can wander through dewy tea plantations and bamboo forests, or swim in a reservoir to the buzz of cicadas. Accommodations are basic—the wooden �oors creak and there’s no air-conditioning—but bungalows come with Western-style kitchens, �at-screen TVs and wireless Internet.

Get Naked in the Moganshan Hills

The Flowers of Warspite of Bale’s yeoman e�orts—is not always clear, largely the result of the script’s weakness. If there are too many plot contrivances, there are also a number of startling surprises that render the �lm theatrically potent.

Overall, cinematographer Zhao Xiaoding’s vision is simply magni�cent; costume designer William Chang Suk-Ping’s work is impeccable; and Tao Jing’s sound design makes a major contribution to the �lm’s undeniable impact. �e Flowers of War will likely be remembered as a triumph of the genre.

�e �lm, set during the Japanese invasion of China, is told from a young girl’s point of view, not as a history lesson, but as an intimate, elemental and paradoxically universal celebration of the human spirit. Bale stars as a dissolute Westerner who seeks refuge in a Catholic Church. �ere he meets a beautiful Chinese courtesan who helps him rescue a group of schoolgirls from a terrible fate at the hands of the Japanese.

�e �lm represents one of China’s most ambitious productions, involving the recreation of 1937 Nanking built from scratch over a one-year period and the collaboration of one of Hollywood’s most sought a�er leading men (Christian Bale).

The Flowers of WarF I L M R E V I E W


Directed by: ZHANG YIMOU’S

The horrendous assault of Japanese troops in late 1937, which came to be known as the Rape of Nanking, caused the deaths of over 200,000 Chinese. �e list of

atrocities is endless and no �lm to date presents them in more harrowing fashion than director Zhang Yimou’s �e Flowers of War.

Its opening sequence, in which an outmanned Chinese unit �ghts ri�es-against-tanks to save a few endangered women, is as blunt as it is brutal. Hard-drinking American mortician John Miller (Christian Bale) is introduced, �eeing the same Japanese units and, through some miraculous accidents, �nding his way to a battered but still-standing cathedral whose Red Cross �ag theoretically protects the inhabitants.

Adapted by Liu Heng from the novel by Yan Geling, �e Flowers of War o�ers two distinct species of “�owers”: One group consists of beautiful

courtesans on the run, while the other encompasses cloistered schoolgirls who sing in the church choir and who deeply mourn the recent death of their Catholic priest. To save both the prostitutes and the adolescent girls—who recoil from any association with fallen angels—Miller must put on the Father’s black robes and emulate priestly behavior. Gradually, he acquires a new dignity and compassion. He stops trying to bed the sultry leader of the courtesans, Yo Mo (Ni Ni), and begins to treat her like the clever, formidable survivor that she is.

In the second act, momentum slows and sections of dialogue seem incongruously sentimental. However, if one is willing to extend imagination and allow that centuries of Chinese tradition permit raw emotions to be expressed in the midst of blunt catastrophe, then these speeches may be accepted as part of ancient Chinese mores surviving to present day. Considering Zhang’s profound understanding of his country’s national characteristics, the lyrical passages have a legitimate place. Contrasting with them are ruthless military sequences—especially a scene in which a single Chinese soldier wipes out an entire Japanese squad. �is should be reality enough for most viewers. Audiences should be dazzled by Zhang’s skill and inventiveness.

Still, �e Flowers of War’s primary concern is �rst and foremost brutality against women in wartime. Saving as many of them as possible is the thrust of the action. �e motivation for Miller to become a better man—in


and had become a custom since it started in 1983. With changes in society, it is but a given that the way Spring Festival is celebrated will continue to evolve.

As young people go back to their hometowns, it is time not just for a re-union with families but also with old friends from school and the neighborhood. Many a strong friendship is re-a�rmed and many lost romances are relived. If somebody is unable to make it back home, friends go to his/her parents instead to “bainian” or pay respects for the New Year. �ere is a custom to drink Chinese rice wine while paying New Year respects. �is is a sort of a coming of age ceremony for young people when parents themselves o�er the extremely strong rice

wine to their children. Boys are even o�ered a smoke by the father when he is considered “grown-up.”

Like in India, family is also very important in China. Chun Jie or Spring Festival is the time when the family cherishes some happy memories, eats sumptuous food and forgets its sorrows to welcome the New Year with great happiness, �re crackers and the colour red.

To all my Chinese friends – zhu nimen chunjie kuai le!! And to my Indian ones – Naye saal ki shubhkamnaayen! And a very happy and prosperous New Year to you all!!!

December is the month China starts decorating itself. Every shop, o�ce building, public site starts putting up Christmas trees, ‘Santa’s and reindeers. Surprisingly,

not many Chinese celebrate Christmas as a festival in the way Christians would do; but the spirit is there everywhere – at least in the big cities. Much like in India I suppose, where people like an extended period of festive spirit (Navratri to Diwali can be taken as an example), the Chinese seem to like the festive mood that starts right from December and goes up to the spring festival in January/February.

I have written about the spring festival earlier, when last year I had visited my friend at her Gansu province home to spend the Spring Festival with her and her family. �is year, I asked my friends and colleagues about how they see customs changing with time. My colleague Jacob Jiang, university educated at Nottingham and a native of Dalian in the north, says that certain northern customs have remained unchanged such as the tradition of not getting a haircut in the month of the Spring Festival for fear of causing death to one’s maternal uncle. Irene, another colleague of mine who along with Jacob represents China’s new brigade of con�dent, �uent in English, Western-educated youth, says that with the advent of social networking, younger people are tending to celebrate Spring Festival ‘online’ with constant updates and greetings on media such as Weibo, QQ groups– as Spring Festival is celebrated mostly with family, social networking sites have provided an e�ective way of keeping in touch with friends made during university and work-life. Younger people are also getting less and less interested in watching the annual ‘CCTV Chinese New Year Gala’ broadcast by the Chinese national TV channel, CCTV, which was much anticipated every Spring Festival evening

SUMELIKA BHATTACHARYYAChronicle Bureau, Shanghai

Have a dragon year!

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India china april -2012