Two Indian youth, Deepak Raheja and Shyamsundar Agarwal, who were employed in a firm owned by an Yemeni national in the Chinese city of Yiwu in the Zajiang province, had a horrowing experience over last few weeks.Their firm was involved in the export trade. They would buy goods in the Yiwu market from local traders and export the same. Over last few months, this firm had accumulated huge payables or debts to Chinese local dealers, who were continuously pestering them for immediate payments. When the total debts crossed 1.58 Million US$ on 10 Million RMB, the Yemeni owner of the firm, just disappeared. These two Indian youths, who were left behind to face the music, had absolutely no clue about the whereabouts of the Yemeni owner. Realizing that the owner of the firm is absconding, the Chinese creditors of the firm got real mad and actually abducted these two Indian employees.
When these youth sent an SOS to the Indian Consulate in Shanghai, Mr. Balchandran, a consulate official was sent to Yiwu to secure the release of these two youth. Mr. Balchandran had long negotiations with the Chinese traders. The negotiations went on for such a long time, in which this consulate official was not even offered food or water to drink, he fell down in a fit and became unconscious. When things became that very serious, the Shanghai consulate contacted Indian Government. Things moved at highest level and official Indian complaint was launched with Chinese Consul in India about this lawless behaviour on part of officials in Yiwu. Only after this, Chinese Government intervened and these two youth were released.
This is not the first case of abduction that has taken place in the Pearl river delta cities like Yiwu and Shaoxing from southern China. In Shaoxing an Indian trader was abducted and held up by the Chinese traders for more than a month. Indian consulate in Shanghai has received during last few years at least six calls from panicked Indian traders in desperate situations.
Twelve diamond merchants from India, who were under arrest in Schenzen and accused of trying to smuggle diamonds, were released by the Chinese Government recently. However there is a basic difference between their case and Yiwu abductions. The diamond merchants were accused of tax evasion and Chinese Government had arrested them. No Government agency was involved in Yiwu abductions.
It is generally observed that any monitory dispute in Yiwu and Shaoxing ends amicably when full payment is made. However,this must be the first case where employees of the trading firm were abducted by Chinese traders as the owner of the firm had disappeared. Local police normally do not interfere in such monitory disputes. One of the abducted youth, Deepak Raheja had come to Yiwu only an year ago. He was warned by other Indian in the city about the treatment Chinese traders give to defaulters in Yiwu. He might never would have imagined that he would have to face that situation within an year. Deepak Raheja says that Chinese Traders had hired thugs from hei shehui, or black society (An underground criminal organization.) to torture them. Chinese traders take help of this underground criminal society because police are not ready to interfere in such trade disputes. These days, because of the global recession, the situation in Chinese markets is extremely unstable. This has resulted into large number of defaults on part of foreign buyers. Chinese traders therefore have become extremely wary because of the unwillingness or inability of law enforcement agencies to solve many cases.
The State-run Global Times newspaper said in a warning to Indian businessmen, “they should obey rules”. “If they cannot get rid of their bad habit of defaulting on debts, both Chinese and foreign businessmen will keep away from them,”.It also hit out at the Indian government’s ‘narrow nationalism’, saying the latest dispute was a confrontation between ‘ nationalist sentiment’ of Indians and what it described as Yiwu’s ‘steady market regulations’.
Even after Indian Government’s warning to Indian traders to keep away from Yiwu, it is doubtful whether this would happen in reality. Yiwu market is thriving and is a great place to do business. Indian traders therefore may not listen to the Indian Government advisory and may continue to do business in Yiwu.
26 January 2012