China emerges as India’s top trading partner

In spite of a rising anti-China sentiment in India following a bloody border conflict last June, China has emerged as the country’s biggest trade partner. Bilateral trade between the two counties for the calendar year 2020 was US$77.7 billion, greater than the US ($75.9 billion) which had led the table in 2019.

However, the current figure is lower than the previous year’s India-China bilateral trade of $85.5 billion, as per provisional data from the Commerce Ministry.

Interestingly, after the June clash, in which 20 Indian soldiers lost their lives, the Indian government had taken a series of measures to curb trade with China. It had banned 220 mobile apps run by Chinese firms, including TikTok, increased scrutiny on Chinese investments in India, and hiked duty on certain products.

But this was outweighed by India’s heavy dependence on Chinese-made goods, especially heavy machinery, telecom equipment and home appliances. Despite an 11% increase in exports to China at $19 billion, the trade deficit stood at $40 billion, making it India’s largest. India’s imports from China were at $58.7 billion, more than the purchases from the US and the UAE combined.

The rise in exports to China was propped up mainly by metals. While aluminum registered a whopping jump of 2,023%, it was 336% for iron and steel and 75.4% for ores. The total value of metal exports to China in 2020 was $4 billion, out of which $2.53 billion was iron and steel.