India Firms Push China Deals Amid Approval Delays

Several Indian companies are advancing collaborations with Chinese firms, commencing initial project work despite pending government approvals under Press Note 3 (PN3). These delays, ranging from three to twelve months, are causing significant business disruptions and budget overruns, prompting companies to push for expedited clearances due to China's technological contributions.

Dixon Technologies, a major electronics contract manufacturer, has initiated the construction of a display module factory and ordered machinery, even though its joint venture with China's HKC Corp has not yet received PN3 approval. The company's managing director expressed confidence in eventual approval, noting that production commencement is not contingent on PN3, with a contingency plan for a 100% subsidiary.

Similarly, PG Electroplast Ltd. has begun construction on an AC compressor plant near Pune, intended for a technical alliance with Shanghai Highly Group. This partnership awaits approval from Chinese authorities for nearly a year. Industry executives highlight that despite improved India-China relations, approval processes remain slow, impacting project timelines and revenue forecasts.