Indian Embassy in China issues advisory for Indian companies to adopt adequate precautions while dealing with Chinese entities for trade

The Trade and Commerce Wing of the Indian Embassy in China has issued an updated advisory for Indian small and medium enterprises that intend to do trade with local entities in China. In an advisory, the Embassy requested that Indian companies take note of the advisory and adopt adequate precautions while dealing with Chinese entities. The embassy also recommended that Indian companies write to the embassy or consulates in Shanghai, Guangzhou and Hong Kong before doing business with any Chinese company to verify its credentials.

In the case of large transactions, it asked the Indian companies to consult a Business Service Company which can provide a report on the business transparency, financial health, reputation, reliability and credentials of the Chinese entity. The companies are also advised to collect and retain copies of



both the Resident Identity Card and passport of the proprietor before doing business.

Highlighting that the majority of the trade dispute cases involve companies registered in Shandong, Hebei, Guangdong, Jiangsu and Zhejiang provinces, the embassy advised the companies to take extra precautions before trading from these provinces.

The advisory includes three annexure documents that contain a list of typical problems that Indian companies face, a checklist of precautions that Indian companies are advised to take while dealing with Chinese entities and descriptive accounts of typical modus operandi adopted by offending Chinese entities. It also contained a list of Chinese entities involved in trade disputes with Indian companies from 2009 to April 2024.