What the power shift in China means to Indian IT industry

BANGALORE, INDIA: The new Communist Party of China chief and President-in-waiting, Xi Jinping, secured a favorable mandate on Thursday that would see him become the successor to incumbent Hu Jintao next March.

As China's economy is said to be experiencing slowdown, also attributed to rampant corruption and trade policies, Jinping has the onerous task of resurrecting the world's second-biggest economy's image across the globe, starting with neighboring countries like India.

The leadership change also means that there would be a new-look panel of financial experts leading the economic reforms in near future.

On its part, India has expressed hope for continued trade relationship with China, while striking the right balance. "We will continue trying to create a balance because there is an adverse balance of trade and we are seeking market access for Indian IT companies and pharmaceuticals and I hope it will come," Union Commerce and Industry Minister Anand Sharma has said at the World Economic Forum on India.

"I hope we find some balance in our trade, which we have talked to the previous (Chinese) Prime Minister. We would continue our dialogue and engagement. China is an important partner for India," Sharma added.

On the possible impact of the power shift in China on India, VMware managing director (India & SAARC), T. Srinivasan said that from a domestic consumption standpoint, there wouldn't be a significant impact, but Indian businesses with a presence in China might suffer.

"As far as domestic consumption is concerned, most of the companies doing business here are Indian entities. As to what happens to the IT services industry, we have to wait and watch," he explained.

Since there has been a positive shift in trade relationships between India and China over the past two years, there are good indications of the bond strengthening in future as well, said Pradip K. Dutta, corporate vice-president & managing director of Synopsys (India).

"Both countries are keen about and want to work together to improve their business relationships. I am optimistic it is going to be exciting."

Also, Dutta expressed optimism that nothing much would change between the two countries going forward.

©CIOL Bureau