In this undated file photo, Indian and Chinese national flags flutter side by side at the Raisina hills in New Delhi, India. (PHOTO / XINHUA)
Although India and China do not agree on all issues, the volume of India's imports from China keeps rising with bilateral trade expected to again top $100 billion this year. .
India's total imports from China increased by nearly 29 percent in the past five years, Union Minister of State for Commerce and Industry Anupriya Patel told the Indian Parliament late last week.
India's total imports from China increased by nearly 29 percent in the past five years, Union Minister of State for Commerce and Industry Anupriya Patel told the Indian Parliament late last week
Annual imports from China rose to $115.4 billion in 2021-22 from $89.7 billion in 2017-18, Patel said.
The minister was responding to a question on the details of bilateral trade with China during the last five years. Along with increased import, Commerce Ministry data showed a decline in India's exports to China.
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The India-China trade is on course to cross $100 billion for the second consecutive year as it has gone up to $67.08 billion in the first half of this year amid a big surge of Chinese exports, according to the trade data released by China's General Administration of Customs.
China's exports to India went up to $57.51 billion, up 34.5 percent last year while Indian exports to China fell to $9.57 billion, a decline of 35.3 percent compared to last year, according to the GAC. The trade deficit at the half-year mark stood at $47.94 billion.
Last year, the India-China bilateral trade hit a record high of $125 billion, the GAC said.
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India has a trade deficit with the world, when there is a trade deficit with the world there will obviously be a trade deficit with important countries, said Professor Manmohan Agarwal, honorary fellow, Institute of Chinese Studies and former prof, Centre of International Trade and Development at Jawaharlal Nehru University, New Delhi.
China is a large important country in the world, so the trade deficit with China will be large. Many countries in the world also have large trade deficits with China, Agarwal said.
Analysts said the country is dependent on China for several raw materials. As India’s manufacturing sector grows, the need for such raw materials has also gone up.
A large portion of imports are animal or vegetable fats; ores, slag and ash; mineral fuels, inorganic chemicals, organic chemicals, fertilizers, tanning or dyeing extracts, miscellaneous chemical products, plastic and articles, paper and paperboard, cotton, textile fabrics, footwear, glass and glassware, iron and steel, copper; nuclear reactors, boilers, machinery, and mechanical appliances; electrical machinery, furniture, among others, government data showed.
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Minister Patel said the government has launched Production Linked Incentive or PLI programs in 14 sectors, which will make Indian manufacturers globally competitive, to reduce dependence on imports from China.
The sectors with PLI programs include key starting materials/drug intermediates and active pharmaceutical ingredients, large scale electronics manufacturing, manufacturing of medical devices, electronic/technology products, pharmaceutical drugs, telecom & networking products, food products, white goods, high-efficiency solar PV module, automobiles and auto components, advance chemistry cell battery, textile products, specialty steel and drones and drone components.
"Technical Regulations or TRs have been framed for several products for the maintenance of standards/quality of imported products. This will check the import of substandard products," the minister said.
The strict COVID-19 lockdowns in China have led to a fall in demand for goods that were majorly imported from India, including iron ore, cotton and meat, Indian experts said.
One of the reasons of China’s surge in export is that it can export its goods much cheaper rate than other countries due to large scale production and its economy is largely driven by manufacturing sector, said Prof Biswajit Mandal, department of economics and politics, Visva Bharati University, Santiniketan, West Bengal.
China's manufacturing output expanded from 16.98 trillion yuan ($2.16 trillion) in 2012 to 31.4 trillion yuan in 2021, with its share in the global manufacturing sector rising from around 20 per cent to 30 percent, according to the State Council Information Office of China.
The writer is a freelance journalist of China Daily.