Dan's China diary - day 6

In May 2006, silicon.com senior reporter Dan Ilett travelled to China, seeking to get behind some of today's most interesting tech and business stories. This is his warts-and-all diary, which appears daily this month. For in-depth coverage of this fact-finding trip inside China, including analysis and exclusive stories, click here.

Thursday 11 May, Beijing

Sneak off first thing to the Summer Palace for a couple of hours. The place is massive and well-crafted, with ornate buildings. Emperors used to come here to relax in the summer and I can see why. Feels good to get out of the tech world for a couple of hours. I take a relaxing boat ride to the other side of the palace and try to get some good photos - like the one below.

Unfortunately I can't spend too long as have agreed to meet a guy from Tsinghua University. It's been tough getting into Tsinghua, one of the best universities in China, so I'm not about to give this one up. Race back to the hotel.

Cheng Peng is not how I imagined him to be (that's him in the photo below). After all the emails and misunderstandings as to whether we would actually meet, Peng is much younger, more charming and dynamic than I'd expected. He's in the middle of his PhD at Tsinghua and tells me the fascinating story of his family's life and how much it has changed over the last 10 years or so with the development of the country. Definitely one of my best interviews so far.

Peng takes me to Tsinghua University Science Park - the place is home to some of China's biggest tech companies, such as Sohu and Sina.com. Google also has a spot here.

I'm starting to realise anything that happens in the tech world in China probably involves Tsinghua University. Old boy alumni all helping each other. Penetrate that and you penetrate one of the biggest barriers to the Chinese tech world.

Later on meet the head of outsourcing for Tsinghua, Jichang Guang. Unsurprisingly Peng knows him. Jichang, or Jim as he calls himself, shows me around the area and explains how the government is pumping cash into new start-ups. He then shows me the incubator - a place where 170 new companies are given government grants of up to $12,000 a year, free office space and help with resourcing. Nothing like that back in the UK.

It could be a big PR stunt but it's impressive. The alliance between academia and industry seems to be so much stronger than in Europe. Jim, who is also the CEO of an outsourcing company, explains how it's common for academics to teach in the morning, go to lunch as a CEO of their own company and then work as a CTO in the evening researching.

Back to Zsoft later that day to meet the undergrad software engineers. What's interesting is they all want to study abroad. There are massive waves of returnee Chinese coming back from the US, the UK and other Western countries. The US is the biggest port of call for the tech industry.

Go to Yashou market in the evening. Security guards stand outside the indoor market while people sell ripped-off DVDs on the street. The guards don't seem bothered. I go inside for a serious bargaining session to get some cheap stuff.

Leave the market questioning how I just spent £3 on a set of nail clippers and £8 on a pair of dodgy sunglasses I didn't want. Baffled.

Walking down the street I'm approached by several foreign drug dealers. "You want some shit?" they ask, smiling.

Meet my pal Kaiser for dinner in a swanky cafe called Bookworm. Some Chinese girls in the corner are speaking fluent English, talking about books - I'm seeing a sophisticated side to Beijing that might not reflect what the rest of the country is like. But I guess most silicon.com readers doing business here will be covering similar territory, so I think it's relevant.

Get home late after a few rounds of whisky back at Kaiser's pad.

Read more about the links between academia, government and business in China next Tuesday in our Inside China special report.

Tomorrow - inside Nokia's secretive factory just outside the capital.