INDIA-CHINA TRADE
CONTEXT–
- Despite frosty bilateral relations, India-China bilateral trade touched all time high of $135.98 billion in 2022.
According to recent trade data released by Chinese custom departments-
- The trade between India and China touched an all-time high of $135.98 billion in 2022. The trade deficit between the two countries crossed $100 billion for the first time in favour of China.
STATISTICS ON INDIA-CHINA TRADE:
- From 2015 to 2021, India-China bilateral trade grew by 75.3 percent, an average yearly growth of 12.55 per cent.
- During 2022, China’s imports from India dwindled to $17.48 billion, a year-on- year decline of 37.9 percent.
- The trade deficit in 2021 stood at $69.56 billion as India’s imports from China witnessed an increase of 46.14 percent to reach $97.59 billion.
- India’s exports to China increased by 34.28 percent year on year to reach $28.03 billion in 2021.
The top commodities that India imports from China include:
- Electrical machinery and equipments.
- Television image and sound recorders.
- Active pharmaceuticals Ingredients (APIs)
- Nuclear reactors, boilers, machinery and mechanical appliances and parts.
- Organic chemicals.
- Plastic and plastic articles.
India’s exports to China were 5% of its total shipments.
The top exported commodities included:
- Ores, slag and ash
- Organic chemicals, mineral fuels/oils and products of their distillation, bituminous substances, mineral waxes;
- Iron and steel
- Aluminum and articles
- Cotton
- Light Naphtha (India’s most valued export).
REASONS OF TRADE DEFICIT:
- Indian exports to China are mostly primary and have very narrow basket of commodities.
- Chinese goods have cost competitiveness over India goods.
- China has placed certain regulations, especially in pharma, agriculture and IT, which make it difficult for Indian goods to enter Chinese market.
Syllabus- PRELIMS, MAINS GS-3
