Many Indian companies are finding exporting goods and manufacturing goods in China to be a difficult task despite free trade agreements. In fact, partnering up with a local Chinese company or the Chinese government did not help Tata Consultancy Services break into the Chinese market.
Instead of import duties and tariffs, the Chinese government is using restrictions such as security clearances to restrict foreign companies and individuals from doing business with local Chinese companies or engage in manufacturing enterprises in China. Similar to the Tata, there are several other companies that are finding it difficult to compete against lower priced goods.
Many Indian companies and individuals are strongly encouraging the Indian government to increase import duties on Chinese goods and file for antidumping violations with the World Trade Organization. Currently, India has 44 antidumping cases against Chinese manufacturers. The legitimacy of the WTO’s rulings and its effectiveness in providing redress to private companies looking to compete against Chinese companies remains to be seen.
If the WTO does not provide appropriate relief or redress, then India and many other countries may return to a policy of creating trade barriers against Chinese companies. The U.S. and India both need appropriate forums to redress antidumping violations by China. However, whether or not either will be able to utilize the WTO as a true enforcement body will depend on the Chinese government’s willingness to abide by their free trade agreements and WTO rulings.
For additional information about the WTO see: http://www.wto.org/