Mr Sudhir Deoras (center in front row), Chairman, CII Eastern Region at the BCIM Business Council Meeting, 6 June 2013, Kunming.

(L-R) Mr Madhav Sharma, Chief Representative, CII China; Mr. James Zhan, Co-Chairman of CII IBF & President-China, Tata Sons Ltd.; Mr. Wang Qunbin, Executive Director and President of Fosun Group; Mr. Naveen Srivastava, Consul General of India, Shanghai; Mr. Rangarajan Vellamore, Chairman of CII IBF & CEO, Infosys Technologies (China) Ltd. and Mr. Pan Song, Managing Director, India Investment Division, Fosun Group, 27 June 2013, Shanghai

July 2013

India & China India-China trade (Jan –June 2013)

Trade June 2013 US$ billion

Jan-June 2013US$ billion Change

Total Trade 5.230 31.385 -7.2%Imports from China 4.385 23.618 4.2%Exports to China 0.845 8.067 -29.8%India’s deficit 3.540 15.551

http://www.customs.gov.cn/publish/portal0/tab1/info436841.htm

CII & China India-China Business Cooperation Seminar in Xuzhou & NanjingThe Consulate General of India, Shanghai and CII jointly organized India-China Business Cooperation Seminars on 6 June 2013 in Xuzhou and on 28 June in Nanjing respectively. The Seminars provided a platform for Indian and Chinese companies to interact and explore new business and cooperation opportunities. Mr Naveen Srivastava, Consul General of India, Shanghai delivered keynote speeches on overview of India - China trade and investment relations. About 80 representatives of Indian companies who have invested in China and Chinese companies who have invested in India participated in each seminar and shared their experiences.

BCIM Business Council MeetingThe first BCIM Business Council Meeting was held on 6 June 2013 in Kunming coinciding with the 8th China - South Asia Business Forum and the 1st China – South Asia Fair after the signing of Agreement amongst the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), CCPIT Yunnan, CII Eastern Region and Republic of the Union of Myanmar Federation of Chambers

of Commerce and Industry (UMFCCI) in February 2012. The BCIM Business Council Meeting discussed promotion of the regional economic and trade cooperation through the four organizations, encouraging the enterprises of the four countries, strengthening the bilateral and multilateral enterprise cooperation etc. Mr. Sudhir Deoras, Chairman, CII Eastern Region attended the meeting and delivered a speech.

Interaction with Senior Management of Fosun GroupCII India Business Forum organized an interactive session with the senior management team of Fosun Group in Shanghai on 27 June 2013. The session provided a platform for Indian companies to interact and explore business cooperation opportunities with Fosun Group in sectors such as pharmaceuticals, financial services, real estate, steel, machinery etc. Around 15 selected members attended the session. Mr. Naveen Srivastava, Consul General of India, Shanghai along with Mr. Rangarajan Vellamore, Chairman of CII IBF & CEO, Infosys Technologies (China) Ltd.; Mr. James Zhan, Co-Chairman of CII IBF & President-China, Tata Sons Ltd. and Mr. Madhav Sharma, Chief Representative, CII China had a private meeting with Mr. Wang Qunbin, Executive Director and President of Fosun Group.

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China PulseThe Monthly China Journal of Confederation of Indian Industry July 2013- Volume 10 No 7

July 2013

China EconomyChina’s external trade (Jan –June 2013)

Trade June 2013US$ billion

Jan-June 2013US$ billion

June 2013 Jan-June 2013Change Compared to May 2013

Change Compared to June 2012

Change Compared to Jan-June 2012

Total trade 321.507 1997.692 -6.8% -2.0% 8.6%Exports 174.316 1052.823 -4.6% -3.1% 10.4%Imports 147.191 944.869 -9.3% -0.7% 6.7%Surplus 27.124 107.954 - - -

http://www.customs.gov.cn/publish/portal0/tab1/info436836.htm

Economy indicatorsGDP growth Q2 Down to 7.5% Retail sales H1 $1.8 trillion, Up 12.7%

GDP growth H1 7.6% Tourism revenue H1 $228 billion, Up 10.7%

GDP H1 $4 trillion New yuan-denominated loan (June)

860.5 billion yuan, up 8.93%

Industrial output H1 Up by 9.3% New yuan-denominated loan H1

$5.08 trillion yuan

Industrial value-added output (June)

Up 8.9% M2 (at the end of June) 105.45 trillion yuan, up 14%

Urban fixed-asset investment H1

$2.94 trillion, Up 20.1% Fiscal revenue H1 6.86 trillion yuan (1.12 trillion) Up 7.5%

FDI H1 $61.98 billion, up 4.9% ODI (Non-financial) (Jan-May) $34.3 billion, up 20%

China's outbound tourists surpass 37 million The number of outbound tourists leaving China reached 37.92 million in the first five months this year, up 17.3% YOY. However, the inbound overnight visitors dropped by 4.06% to 22.93 million during the same period.The number of domestic travelers reached 998 million in the first quarter, up 14.1%, with domestic travel revenue standing at $123.92 billion, up 18.4%. China has the world's largest domestic tourism market and outbound Chinese tourists are the biggest spenders worldwide (More).

Chinese people's income may reach $12,000 Per capita income in China will reach 8,800 dollars in 2020, and may even reach 12,000 dollars, which would enable China to become a high-income country by UN standards, according to Justin Yifu Lin, former chief economist at the World Bank, who made this remark at the 3rd Global Think Tank Summit in Beijing on 29 June. He also said that China's GDP in 2020 is expected to be double of that in 2010 (More).

China's foreign debt rises to $765 billion China's outstanding foreign debt hit $764.97 billion by the end of March, up from $736.99 billion at the end of 2012. The country's outstanding long- and medium-term foreign debt stood at $199.29 billion, up from $196.06 billion at the end of December. Outstanding short-term foreign debt, due within one year, rose to $565.68 billion from $540.93 billion at the end of 2012 (More).

Government & PoliticsXi launches Party cleanup campaignXi Jinping, General Secretary of the Central Committee of the Communist Party of China (CPC) has launched a year-long campaign to thoroughly clean up undesirable practices such as formalism, bureaucratism, laxity and extravagance. "The main task of the campaign is to focus on building work styles," Xi said at a high-profile conference held on June 18, to deploy the campaign. The conference was also attended by the other six members of the Standing Committee of the Political Bureau of the CPC Central Committee, including Li Keqiang, Zhang Dejiang, Yu Zhengsheng, Liu Yunshan, Wang Qishan and Zhang Gaoli (More).

China builds world's fastest supercomputer Chinese scientists announced on June 17, that China has once again built the world's fastest supercomputer, capable of performing 33.86 quadrillion operations per second, surpassing the US Titan supercomputer. The Tianhe-2 (or Milkyway-2) super computer has a peak performance speed of 54.9 quadrillion operations per second, according to the National University of Defense Technology (NUDT), which built the computer. The NUDT said that it would produce a supercomputer performing 100 quadrillion operations per second by 2015 and further raise it by 10 times around 2020 (More).

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July 2013

Shanghai to ease residency permits for outsidersShanghai authorities on June 19 announced that they will ease controls over residency permit applications for non-locals starting from July. The new regulation makes Shanghai the first Chinese metropolis to give nearly equal urban status to non-locals. According to a new residency permit regulation, non-Shanghai residents can apply for a residence permit evaluation by accumulating 120 points, which are calculated using a number of factors including an applicant’s age, education background, profession and work performance (More).

Cross-Strait ties get further boostThe Chinese Mainland on June 16, announced a total of 31 policies in the areas of legal rights, education, culture, tourism and other aspects of economic and social life to further boost cross-Strait ties, during the fifth Straits Forum meeting (More). Chairman of the National Committee of the Chinese People's Political Consultative Conference (CPPCC), Yu Zhengsheng in his address at the 5 th Strait Forum, which opened in Xiamen of Fujian province on June 16, promised that the Chinese Mainland will continue "correct policies" to consolidate peaceful Mainland-Taiwan ties (More). Mainland China and Taiwan on June 21 also signed a service trade agreement, which is expected to further strengthen cross-Strait economic ties (More).

China under pressure to cover aging populationChina will face financial pressure to cover the growing population of senior citizens with its social insurance funds. To tackle the payment pressure, China has to preserve and increase the value of its social insurance funds and ensure the sustainability of its policies. In 2010, 178 million people in China were 60 years of age or older, accounting for 13.26% of the total population (More).

China to set up two new funds to boost trade with AfricaThe China-Africa Business Council (CABC) and the China-Africa Development (CAD) Fund have decided to set up two new funds this year to boost China's investment in Africa. One fund is for commercial ventures and the other for mining activities. Zheng Yuewen, chairman of CABC, which represents the interests of more than 550 Chinese companies in Africa, said each fund will raise $1 billion in its initial phase from the member companies and the CAD Fund, China's largest private equity fund, will focus on African investments (More).

China to end iron ore licensing in 2013 China plans to scrap its decade old iron ore import licensing system this year, according to the Chinese industry sources. This move is likely to reduce the costs for domestic steel mills by eliminating licensed middlemen for imports. It could also mark the end of years of efforts by China to strictly regulate the trade due to worry over its growing dependence on imports and in an effort to wrest pricing power away from big miners such as Rio Tinto and Vale (More).

China, Britain agree on currency swap Mervyn King, governor of Bank of England (BoE) and Zhou Xiaochuan, governor of People's Bank of China (PBC), signed an agreement to establish a reciprocal 3-year sterling/renminbi (RMB) currency swap line. The maximum value of the swap is 200 billion Chinese yuan/20 billion pounds. The swap line may be used to promote bilateral trade between the two countries and support domestic financial stability (More).

China's social security fund tops 1 trillion yuanTotal assets managed by China's National Council for Social Security Fund reached nearly 1.11 trillion yuan ($179.6 billion) by the end of 2012. The fund's annual earnings rate stood at 7.01% in 2012, higher than 0.84% in 2011 and 4.23% in 2010 (More).

Business & IndustryEU imposes punitive tariffs on Chinese solar imports The European Commission June 4, decided to levy temporary punitive duties on Chinese imports of solar panels, cells and wafers. EU will impose a tariff of 11.8% starting from June 6 to August 6 and further increase the tariff to 47.6% unless EU reaches a settlement with China within the next 60 days. The temporary tariffs will stay effective until the beginning of December, when the full investigation will be completed (More).

Media sector valued at $203 billion in 2017China's entertainment and media market is estimated to grow by an annual 12% compound rate in the next five years to $203 billion in 2017, with Internet advertising likely to grow the most. Overall advertising spending may expand 12.4% annually through 2017 to $55.7 billion while the traditional media will continue to dominate the sector in the next five years, PricewaterhouseCoopers said in its annual Global Entertainment and Media Outlook (More).

China's 2012 cultural product exports exceed $20 billionExport volume of China's cultural products reached $21.73 billion in 2012, with YOY increase of 16.3%. Cultural industry's output in 2012 exceeded $650 billion. Chinese government plans to provide preferential financial, fiscal, taxation and land policies for cultural enterprises, as well as allow more private capital to enter the sector (More).

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July 2013

Sinopec looks north for oil China is increasing its presence in the resource-rich Arctic, with its second-largest domestic oil company, Sinopec, acknowledging ongoing involvement in oil exploration and development in the far north. Sinopec Star Petroleum Co Ltd, a clean energy subsidiary wholly owned by the group, is holding preliminary talks with Iceland over oil exploration off the northeast coast of the Nordic country. Sinopec and Iceland have been cooperating in geothermal energy sector and it is very likely that the two parties will cooperate further in oil and natural gas. On May 15, China secured observer status in the Arctic Council, an eight-member regional decision-making body (More).

Sinopec buys Angola oil field stake for $1.52 billion Sinopec Group has signed a deal with U.S. oil giant Marathon Oil Corp. to buy its oil and gas field in Angola for $1.52 billion. Sinopec will purchase Marathon's 10% stake on the Angolan Block 31 field through its subsidiary Sonangal Sinopec International Ltd. Sinopec's stake in the block will reach 15% upon the completion of the Marathon deal (More). Sinopec has also completed the purchase of 50% of Chesapeake's share in its Mississippi Lime assets for $1.02 billion. Chesapeake is the second-largest natural gas developer in the United States and its Mississippi Lime oil and natural gas assets are in northern Oklahoma (More).

CII India OfficeU. D. Bhatkoti, Advisor

Confederation of Indian Industry

CII China Office Madhav Sharma, Chief Representative

Confederation of Indian Industry

The Mantosh Sondhi Centre23 Institutional Area, Lodi Road, New Delhi-110003

Tel: 91-11-2462 9994-7; Fax: 91-11-24601298Email: u.d.bhatkoti@cii.in; Website: www.cii.in

Room No 11A47/49, Shanghai Mart,2299 Yan'an Road (West), Shanghai 200336, China

Tel: +86 (21) 62360969; Fax: +86 (21) 32283510 Email: ciichinarep@cii.in; Website: www.cii.in

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Disclaimer: This document is being shared for information purposes only and is therefore not intended to substitute for formal professional advice. All information in this document has been compiled and/or arrived at from online sources in the public domain.

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