South Asian Business news and information

The history of past 5 decades shows hardly any record of goodwill between India and China. Rivalry and enmity have been the norm for these two giant neighbors in all these years. They have not become good friends yet but there are signs of change in the recent months. One sign is the possibility of having a long term deal between Indian miners and Chinese steel mills about iron ore. According to Reuters, China imported 68.5 million tones of iron ore from India on spot basis in the last financial year (Indian financial year is from 1 April to 31 March). Now, India is keen to have a long term deal with China about iron ore. India has similar deal with Japan. Although on spot basis sale can draw more money then a long term deal, on spot sale suffers from the risk of fluctuation of the market.

 China is now the largest consumer iron ore. China’s premier has stated that China would let the market decide the price of iron ore. Brazil, Australia and India are the major sellers of iron ore and is afraid that if it does not act decisively now then China may get more interested about Australia and Brazil. Geographical proximity gives India an edge India  wants to make the best out of it. For China, having a good source near to home is a very good option and because of the growing Chinese economy, China is always on the search for new sources of mineral and energy.

 A conference on iron ore are going to be jointly held by Indian and Chinese industry in China's Qingdao during April 13-14.

 We are now in a world in which economic interest can outweigh every other factor.