Trade Deficit Between India and China

The details of export/import and trade deficit between India and China during the last three financial years and current financial year are released.

Context

• The details of export/import and trade deficit between India and China during the last three financial years and current financial year are released.

 Analysis of Trade deficit between India and China

• Trade deficit: Over the years trade deficit has reduced to a great extant
• Export: A rise has seen in the export of India to China.
• Import: A substantial decrease was observed in imports to India.
• Impact of Covid-19 and Sino-India turf: A significant decrease was observed in imports from China during Apr to Nov. Two reasons could be attributed to the fall in import one is Covid-19 pandemic and another is border dispute between both the countries around Ladakh.

Indian Government initiatives

• The Government of India has made sustained efforts to achieve a more balanced trade with China, including bilateral engagements to address the non-tariff barriers on Indian exports to China.
• Various protocols have been signed to facilitate export of Indian rice, tobacco, fishmeal /fish oil and chilli meal from India to China.
• The Government has also taken various measures to extend support to exporters by facilitating Buyers Seller Meets between potential importers of China and the Indian exporters to increase exports.
• In addition, Indian exporters are encouraged to participate in major trade fairs to showcase Indian products.
• The Government has taken theinitiative to sensitize the Export Promotion Councils /Trade Bodies to enhance export of Indian goods.
• The Government has also implemented policies to promote domestic manufacturing through ease of doing business and creating an enabling physical environment for manufacturing, through provision of developed land and infrastructure.