The trade deficit with China stands at $36.21 billion in 2013-14. This can be reduced to sustainable levels through more exports from India to China as well as China investing in building manufacturing capacities in India, Assocham said.
Assocham will hold a summit for Chinese companies to invest in India. Some of the major Chinese companies present were Huawei, ZTE, Haier, Sino Steel, Lenovo, Beijing Automotive Industrial Corporation, Xindia Steel and SANY, among others.
According to an Assocham study, China ranks 31st among countries contributing foreign direct investment (FDI) to India. FDI inflows from China to India currently stand at $0.575 billion while those from India to China reached $0.898 billion.
The two sides also focused on strengthening smart manufacturing, exchange of solar energy and green house technologies along with railway infrastructure, supply stations buildings and escalators for railway metro stations.
Bilateral trade between India and China reached $75.5 billion in 2011-12 with trade deficit of about $40 billion.
"With the growth in bilateral trade between India and China in the last few years, many Indian companies have started setting up Chinese operations to service both their Indian and MNC clientele in China".
"India and China will identify the business opportunities in the small and medium enterprises (SMEs) segment across wide range of sectors from agricultural products to textiles and machinery," Assocham Secretary General D S Rawat said.
The areas identified for collaboration include processed food, cosmetics, rubber, plastics, textiles, machines for garment industry, and small scale plants for a range of consumer durables among others.
The MoU was signed by Rawat and Wu Xiaochun, Director General of SME Bureau China in New Delhi.