Convicts in China heading to Shanghai (7)
I believe the answer is:
inmates
'convicts' is the definition.
('inmate' can be a synonym of 'convict')
'in china heading to shanghai' is the wordplay.
'china' becomes 'mate' (china plate is Cockney rhyming slang for mate).
'heading to' indicates taking the first letters (the head of the word).
The initial letter of 'shanghai' is 's'.
'in'+'mate'+'s'='INMATES'
(Other definitions for inmates that I've seen before include "Prisoners" , "Ties man (anag.)" , "Inhabitants" .)