They will not let you board if there is an issue so you might want to check with the airlines as well as the Chinese consulate in Singapore. Also try to check with Cathay Pacific in Singapore as they should be aware of the procedures.
I just spoke with a colleague who holds an Indian passport and a US work visa. He claims that he does not have to go through this screening as he qualifies as an NRI. I should think that you fall in the same category.
@shri
Its was a total nightmare and could be worse elsewhere. The Indian authorities were very professional and following the local laws. I wont be using my SAR passport (unless absolutely necessary) in the future. I think the Indian Consul is far more professional than these PRC guys.