Trade gap between India and China continues to widen | Current Affairs | Vision IAS
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    Trade gap between India and China continues to widen

    Posted 23 Apr 2024

    2 min read

    • Status of India- China Trade
      • India's exports to China increased from $15.33 billion in FY23 to $16.67 billion in FY24.
        • Key items exported to China include iron ore, cotton yarn, cotton, quartz, etc.
      • India’s imports from China rose from $98.51 billion in FY23 to $101.75 billion in FY24, widening trade deficit by to $85.08 billion in FY 24 (i.e. 2.3%).
        • Key items imported from China include plastics, steel products, fertilizers etc.

     

    • Reasons for increasing Trade Deficit
      • Narrow basket of commodities, mainly raw material and minerals are exported, from India to China. 
      • Increased imports of material for solar energy, electric vehicles etc. due to focus on renewable energy and carbon neutrality.
      • Growth of manufacturing units in India has led to increased raw material imports from China.
      • Preference of firms in sourcing supplies from China due to less cost.

     

    • Measures taken by India 
      • Production-Linked Incentive scheme to make Indian manufacturers globally competitive, attract investment, promote exports.
      • Expanding India’s trade partners by signing and negotiating trade facilitation agreements with European Union, Canada etc.

     

    • Way ahead
      • Explore alternative sources of imports from the ASEAN countries.
      • Boosting India's domestic manufacturing base and exports.

     

    • Tags :
    • India- China Trade Deficit
    • Trade Deficit

    Articles Sources

    https://www.financialexpress.com/policy/economy-india-widens-its-share-in-chinas-imports-in-fy24-346
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