Indian embassy in Beijing issues advisory to SMEs on doing business with Chinese firms

SME’s warned: The Indian embassy in Beijing has issued an advisory urging Indian small and medium enterprises (SMEs) to take specific precautions before engaging in business with Chinese companies. This advisory comes in light of several problems Indian companies have faced while dealing with Chinese entities.

The advisory recommends that Indian companies contact the Indian Embassy (com.beijing@mea.gov.in, ccom.beijing@mea.gov.in) or Indian Consulates in Shanghai (hoc.shanghai@mea.gov.in), Guangzhou (com.guangzhou@mea.gov.in), and Hong Kong (commerce.hongkong@mea.gov.in) to verify the credentials of Chinese entities before conducting any business. The respective Mission will respond within 4-5 working days.

For large transactions, the advisory highly recommends consulting a Business Service Company to obtain a report on the business transparency, financial health, reputation, reliability, and credentials of the Chinese entity.

Additionally, the advisory suggests that Indian companies collect and retain copies of both the Resident Identity Card (Chinese Identity Number) and passport of the proprietor and other responsible interlocutors of the Chinese entity.

The embassy has noted that most trade dispute cases involve companies registered in Shandong, Hebei, Guangdong, Jiangsu, and Zhejiang provinces. Therefore, Indian companies are advised to exercise extra caution when trading with companies from these regions.
The advisory, posted by the Indian embassy on X, includes annexure documents for businesses to review. Annexure 1 lists typical problems faced by Indian companies and provides a checklist of precautions to take when dealing with Chinese entities. Annexure 2 describes typical methods used by offending Chinese entities, while Annexure 3 lists Chinese entities involved in trade disputes with Indian companies from 2009 to April 2024.

(With IANS inputs)