India’s bilateral trade with China has increased nearly three times in 2017-18 to $90 billion from $42 billion in 2008-09, but as China is cementing its position as India’s largest trading partner, the balance of trade between the two nations is tilting in favour of China.
The trade deficit has nearly tripled to $63 billion in 2017-18 from $23 billion during 2008-09.
While Indian goods are struggling to enter the Chinese market, India is getting increasingly dependent on Chinese imports mainly for electric equipment and machines, boilers and fertilisers.
Other top imports from China include plastic items, iron and steel, and optical photographic.
On the other hand, India exports Diamonds, Cotton yarn, copper and Zinc among other items to China.
India is the seventh largest export destination for China but ranks way below at 24 when it comes to exports to China.
India has been continuously pressing China to open up the IT and Pharmaceutical products for India, to reduce the trade deficit between the two nations.
India has also recently flagged its concerns over rising trade deficit with China at the World Trade Organization (WTO). New Delhi also raised issues related to visa restrictions for Indian professionals and even the challenges it is facing in exporting IT services and products such as meat, rice and medicines to China.
However, both India and China have recently slashed import-tariffs of some of the products traded between them following the fourth round of negotiations under the Asia Pacific Trade Agreement (APTA), which also included Bangladesh, Laos, South Korea and Sri Lanka.
China has agreed to reduce tariffs on more than 8,500 items which mainly includes chemical and agricultural products. On the other hand, India agreed to reduce tariffs on around 3,000 products for China.
First Published: IST