THE walls of the Orind Refractories factory in Bayuquan, north-eastern Laioning province, carry signs announcing the goals management has set for the company. One of them is "become the largest refractory group in Asia, coinciding with the Beijing Olympics in 2008.;

So what?

All of China is being primed for the Olympics and a surge nationalism is inevitable. Except that the person who set the target is an Indian- Mr. Raj Mishra, Orind's group managing director.

Orind itself is owned by Mr. Ravin Jhunjhunwala, an Indian typhoon who lives in Singapore and tends to avoid the spotlight. On the factory floor, 32- years’ old packaging manager Cheng Wei explains why she has stayed with the company for eight years. It’s not just that Orind doesn’t fire workers when business is slack; she says “many Chinese are in key positions here and the management invites us too for important meeting," adds Ms. Cheng. “Japanese and Korean bosses tend not to mix with too much. On other hand we mix well with Indians."

Orind reached China in search of the critical fused magnesia required for the high quality refractories, the special bricks that line the furnace of steel. It was the precursor to some two dozen more Indian companies that have set up manufacturing facilities in China , including drug companies, tractor maker and engineering companies.

On july2, the first tractors made by a joint venture between Mahindra & Mahindra and China's jingling Motors Group rolled out from a factory in eastern Jiangxi province. This month Larsen & Turbo, a top engineering company, set up the first overseas unit in Wuxi to manufacture switchgears. As Asia 's twin giants explore each others economies many Indian manufacturers especially higher -end engineering companies such as auto component makers, are shaking off their fear of China , gaining confidence to even attempt production there.

Alongside, their officials are picking up the language and adapting to local customs. There were 450 resident Indians in Shanghai last year. This year, the number is close to 1000. Besides the dynamic market is a huge draw. " China is of great strategic importance for us with its population, changing life styles that are breeding diabetes and cardiovascular diseases," says Mr. CV Narayan Rao. Chief Representative and regional head at Kunshan Rotam Reddy Pharmaceutical Co. in Kunshan, a unit of Indian’s Dr. Reddy' laboratories.

"We expect China 's market for drugs to hit US$100billion (S$165 billions) in 10 years overtaking Japan ." Meanwhile many of their compatriots at home are turning to Chinese suppliers for everything from women’s lingerie to toys and cable television equipment.

Mr. Narender Ahuja, a Ludhiana, Punjab based trader in undergarments who recently made his second visit to Shanghai, says he plans to buy much of his goods from China and will increasingly cut purchases from Mumbai, New Delhi and his own home town. “I pay about 8 lakhs (S$30,000) for a container and it costs me another 6 lakhs in Custom charges and local handling." says Mt. Ahuja having just returned to Shanghai after visiting suppliers in cut lying areas.

Even so, I find it cheaper to buy from China . Besides the quality is quite all right." His brother in law has shut his stockings factory in New Delhi and turned to trading China made socks in India . Roll over, America . At the pace at which trade is growing between China and India , the US is poised to be toppled by China as India 's biggest trading partner in two years time. In 2001, the two countries exchanged US $1.8 billion worth of goods. Last year, that figure was US$13.6 billion.

I expect bilateral trade to top US$ 20 billion this year despite poor air connectivity, no road linkage, a limited trade basket and a knowledge deficit," says Mr. Sunil Kumar, Shanghai based Chief Representative for the Confederation of Indian Industry (CII). I can confidently say that the rate trade is expanding the 100 billion mark is entirely possible in a few years.

In the first two months of 2005, according to statistics released by China ’s General Administration of Customs, India- China bilateral trade grew by 42 percent from a year earlier to reach US$ 2.65 billion. While China 's imports from India rose by a quarter, Indian imports rose by 77 percent, Commodities, including steel, form the bulk of India 's exports.

"India- China relations are at its peak in 40 years," says Mr. B. Vanlalvawna, India 's Consul in Shanghai ." Still it would be fair to say that Indians are showing more interest in China than the other way." he points out that four Indian banks have offices in Shanghai and a fifth is on the way. Conversely, not a single Chinese bank has an India office.

While ignorance about India could be a factor- a Chinese manufacturer of extendable aluminum ladders once called CII, asking if India made the stuff- part of the reason could be lie in India itself. Where China is concerned, New Delhi moves with extreme caution in everything from visas to issuing licenses, factors that will cool the interest of even the keenest Chinese investor. Largest section of industry, burdened by bureaucracy and hidden costs because of corruption and other factors, live in dread of being overrun by China 's manufacturing prowess.

Earlier this year, pressure from the Federation of Indian Commerce & Industry contributed to India going slow on a proposal for an India- China free trade area. Still, as costs rise in China , there will be less justification for anyone to stand in the way of a fuller interlocking of the two economies.

"Costs here are going up while it is our understanding that India will remain a very cost effective country for a longer time." says Orind's Mr. Mishra. "We've already made a strategic decision to put down a plant in India- in Gujarat ."

velloor@sph.com.sg