ABOUT CHINA 

Amongst all the countries in Asia, China, officially the People’s Republic of China, is a vast country located in East Asia. It is the world’s most populous nation and the second-largest by land area. China is renowned for its immense historical significance as one of the world’s oldest civilizations, a cradle of innovation, and its unparalleled economic transformation into a major global power. The capital of China is Beijing, which is a key political and cultural hub, while Shanghai stands as its largest and most populous city, serving as a global financial, economic, and technological center. According to the report of the World Bank, China has been classified as an Upper-Middle Income Economy and is rapidly progressing towards High-Income status. The currency of China is the Renminbi (RMB), often referred to as the Yuan (CNY). As of today’s exchange rates (June 2025), 1 CNY is approximately 11.75 Indian Rupees. The population of China is approximately 1.425 billion in 2024. Its neighbouring countries are numerous, including Russia, Mongolia, North Korea, Vietnam, Laos, Myanmar, India, Bhutan, Nepal, Pakistan, Afghanistan, Tajikistan, Kyrgyzstan, and Kazakhstan. It also shares extensive maritime borders with the Yellow Sea, East China Sea, and South China Sea. The official language of the country is Standard Chinese (Mandarin). English is increasingly understood and spoken, especially among the younger population, in business, and in major urban centers. While officially an atheist state, the population practices various traditional beliefs, including Buddhism, Taoism, and Confucianism, alongside Islam and Christianity. Currently, China boasts an extensive network of international airports, with Beijing Capital International Airport (PEK), Shanghai Pudong International Airport (PVG), and Guangzhou Baiyun International Airport (CAN) being among the busiest globally. As a global manufacturing and trading powerhouse with extensive coastlines, China boasts many crucial commercial seaports, with Shanghai Port (the world’s busiest container port), Ningbo-Zhoushan, Shenzhen, and Guangzhou being vital for international trade and maritime transport.

The standard corporate income tax rate in China is 25%. China has implemented a sophisticated system of tax incentives and reforms to attract foreign direct investment, stimulate economic growth, and promote specific industries. These include reduced tax rates (e.g., 15% for certified high-tech enterprises), enhanced tax deductions for Research and Development (R&D) expenses, and attractive tax benefits for investments in encouraged sectors, specific regions (e.g., Western China Development), and Free Trade Zones (FTZs). The “Negative List” for foreign investment has been continuously shortened, opening more sectors for foreign participation. Opesh Group of companies will be helping you in completing the Due Diligence process which includes financial planning, registration process, business options, and if required, even helping you find a Rental property for your office.

Establishing a business in China has become increasingly streamlined and transparent in recent years due to ongoing government reforms aimed at improving the business environment and digitalizing administrative processes. The Ministry of Commerce (MOFCOM) and the National Development and Reform Commission (NDRC) are key government bodies promoting and assisting foreign direct investment. A foreign investor who is planning to start a business in China can form various company types, with the most common and flexible structures being a Wholly Foreign-Owned Enterprise (WFOE), a Joint Venture (JV), or a Representative Office (RO). The WFOE is particularly popular due to its complete foreign ownership and operational control. China’s legal framework for foreign investment is continuously being refined to be more aligned with international standards, providing a vast and complex yet increasingly predictable environment for businesses.

In case an investor is planning to establish a corporate business setup in China, Opesh Group will be helping you in taking the right decision for setting up your business in China and we will also guide you about how to follow the procedure while formulating your company in China.

Types of Business which can be started in China:

• High-tech Manufacturing & Advanced Materials: As a global leader, opportunities exist in electric vehicles (EVs), robotics, artificial intelligence (AI), semiconductors, aerospace, and advanced materials.
• Digital Economy & E-commerce: With the world’s largest digital consumer base, opportunities are immense in e-commerce platforms, fintech, digital marketing, cloud computing, and cybersecurity.
• Renewable Energy: China is the largest investor and producer of renewable energy. Opportunities exist in solar, wind, hydropower, energy storage, and related technologies.
• Consumer Goods & Services: The growing middle class and consumption upgrade trends offer vast opportunities in high-quality consumer products, healthcare, education, tourism, and entertainment.
• Biotechnology & Pharmaceuticals: Driven by an aging population and increasing health awareness, opportunities are significant in R&D, manufacturing of drugs and medical devices, and healthcare services.
• Logistics & Supply Chain: Leveraging its role as a global manufacturing hub, opportunities exist in smart logistics, warehousing, cold chain, and international freight forwarding.
• Specialized Manufacturing (Niche): Opportunities in precision machinery, industrial automation, and other high-value-added manufacturing segments.

Advantages of Starting Business in China:

• Vast Domestic Market: The world’s largest consumer market with growing purchasing power.
• Comprehensive Supply Chain: A highly developed and integrated industrial ecosystem supporting virtually all manufacturing needs.
• Technological Advancement: A rapidly innovating economy, particularly in digital technologies and advanced manufacturing.
• Skilled & Large Workforce: A massive and increasingly educated workforce, including a large pool of engineers and R&D personnel.
• Significant Infrastructure: World-class transportation, logistics, and digital infrastructure.
• Government Support for Strategic Industries: Strong policy support and incentives for high-tech and emerging industries.
• Leading Role in Global Trade: Central to global supply chains and international trade networks.

Business Opportunities for Indians in China: There are excellent business opportunities in China for new investors who are planning to expand their business abroad. China’s immense market size, technological prowess, and strategic economic initiatives make it a compelling market for Indian investors. Indian investors with strengths in IT services (software development, digital transformation), pharmaceuticals (generic drugs, R&D collaboration), automotive components (supply chain integration, niche manufacturing), renewable energy (solar, wind project components), and specialized manufacturing can find significant avenues for investment, partnerships, and market entry into both the vast Chinese domestic market and for global supply chains.

Imports & Exports: China is the world’s largest trading nation, with a massive volume of goods imported and exported. Imports and exports business is an ever-growing business in any country; however, you need to do proper R&D before investing in that product which you can import or export. You need to check whether that product is suitable for your target market and how much revenue you will be able to generate from that market.

Major items which are exported from China:

• Electrical machinery and equipment (electronics, computers, telecom equipment)
• Data processing machines
• Apparel and textiles
• Furniture and lighting
• Toys and sporting goods
• Vehicles (increasingly EVs)
• Optical and medical instruments

Major items which are imported in China:

• Electrical machinery and equipment (integrated circuits, semiconductors)
• Crude oil and petroleum products
• Iron ore and other mineral raw materials
• Plastics
• Automobiles and parts
• Medical equipment
• Agricultural products

Major items traded between China and India (as of 2023-2025 data):

• Exports from China to India: Electrical machinery & equipment, organic chemicals, nuclear reactors, boilers, plastics, iron & steel products, optical & medical instruments, vehicles & parts, telecommunications equipment.
• Imports in China from India: Iron ore, cotton, organic chemicals, plastics, copper, precious stones, electrical machinery.

Manufacturing: Manufacturing in China is the largest in the world, often referred to as the “world’s factory.” It encompasses nearly every industry, from basic consumer goods and textiles to advanced electronics, heavy machinery, automotive (including EVs), and aerospace. The sector is evolving rapidly towards higher value-added, smart, and green manufacturing, driven by automation, AI, and R&D.

Mining: The mining business in China is extensive and vital for its industrial base. China is the world’s leading producer and consumer of many minerals. It possesses significant reserves of coal (its primary energy source), rare earth minerals (dominating global supply), iron ore, bauxite, lead, zinc, and tin. Opportunities exist in responsible extraction, advanced processing, and developing new mining technologies.

Major Indian companies which are currently working in China: While competition is fierce, several prominent Indian companies have established a presence or maintain significant business ties in China.

• IT Services: Infosys, Wipro, Tata Consultancy Services (TCS) have significant operations and delivery centers serving Chinese and multinational clients.

• Pharmaceutical Companies: Dr. Reddy’s Laboratories, Sun Pharmaceutical Industries, Cipla, and others have a market presence, some with R&D or manufacturing facilities.

• Automotive: Mahindra & Mahindra and Tata Motors (through its global acquisitions like JLR) have explored and maintain some presence or partnerships.

• Banking & Financial Services: State Bank of India, ICICI Bank, Axis Bank (have branches or representative offices in major financial hubs).

• Industrial/Manufacturing: Various Indian manufacturers and suppliers in sectors like chemicals, textiles, and engineering components have trade and investment links.

• GDP = $18.5 trillion (nominal, 2024 est.)

• GDP Growth = 4.8% (2024 est.), 4.5% (2025 forecast by IMF)

• Ease of doing business rank = The World Bank’s ‘Doing Business’ report has been discontinued. However, China has consistently improved its business environment for foreign investors, reflecting ongoing reforms to reduce market access barriers and streamline procedures, although regulatory complexities and market dynamics require careful navigation.

• GDP per Capita = $13,000 (nominal, 2024 est.)

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