Tariff has done a lot of bitter relations between India and America. After which, forgetting the Galwan Clash and once again India is considering joining hands with China. There has been sweetness between the two countries of recent times. China’s Foreign Minister visited India and saw a common co -honor on some important issues. There is also the reason for this. Where India is troubled by American tariff. On the other hand, China can also become a big victim of America’s tariff. If there was no talk between Trump and Xi Jinping. This is the reason that the Prime Minister of the country Narendra Modi is present on the soil of China after about 7 years. The heads of state will talk about mutual trade. At the same time, American will try to solve the tariff.
When it comes to business relations between India and China, the trade has increased even after the Galwan Clash has a lot of boycott of Chinese goods. Surprisingly, India’s export in China has reduced considerably, but there has been a steady increase in exports. This is the reason that if we look at the trade between the two countries, then India has suffered the most. In FY 2025, the trade between the two countries was about $ 128 billion, with India’s trade deficit more than $ 99 billion. Which is a very big gap. This means that India has suffered a loss in trading with China.
By the way, recently the Prime Minister of the country Narendra Modi has said that it is important for India and China to work together to bring stability in the global economic system. He also said that the New Delhi is ready to pursue bilateral relations on the basis of mutual respect, mutual interest and mutual sensitivity from strategic and long -term perspectives. The biggest question is, how will a big trade gap of more than $ 99 billion laid the foundation between the two countries? Will India’s export in the coming days also increase in China or not? Will India and China be able to deepen their reach not only in Asia but also Europe and the rest of the world. Let us try to understand all these things with the answers to some questions.
Question: What is the status of bilateral trade between India and China?
answer: During April-July 2025-26, India’s exports rose by 19.97 per cent to US $ 5.75 billion, while imports increased by 13.06 per cent to US $ 40.65 billion. India’s exports in FY 2024-25 were US $ 14.25 billion, while imports were US $ 113.5 billion.
Trade deficit (difference between imports and exports) increased from US $ 1.1 billion in 2003-04 to US $ 99.2 billion in FY 2024-25. In the last financial year, China’s trade deficit was about 35 per cent of India’s total trade imbalance (US $ 283 billion). The difference in FY 2023-24 was US $ 85.1 billion.
Question: Why is the deficit with China a matter of concern?
answer: This is because it is not only big, but also structural. According to the think tank GTRI, the thing that makes it even more serious is that China now dominates India’s import in almost every industrial category.
Question: China has more than 75 percent stake in which major products?
answer: GTRI analysis states that in antibiotics such as erythromycin, China supplies 97.7 per cent of India’s needs, in electronics, in electronics, it controls 96.8 per cent of silicon wafers and 86 per cent of flat panel display, in renewable energy, 82.7 per cent solar cells and 75.2 per cent lithia. Even China is dominated by everyday products such as laptops (80.5 per cent stake), embroidery machinery (91.4 per cent), and viscose yarn (98.9 per cent).
Question: What is the risk of increasing dependence between India and China?
answer: GTRI founder Ajay Srivastava says that China’s highly dominated status can become a possible pressure to India, as the supply chain can be used as a tool for pressure at the time of political stress. This imbalance is increasing, as India’s exports with China are decreasing, due to which India’s share in bilateral trade today is only 11.2 per cent, which was 42.3 per cent two decades ago.
Question: What steps have India taken to reduce their import dependence?
answer: Start of incentive schemes related to production for over 14 sectors to promote domestic manufacturing; Strict quality standards and measures have been applied for quality control, test protocols and compulsory certification to check poor and poor quality products and protect consumers’ interests.
The government is encouraging Indian professional establishments to diversify its supply chains and detect alternative suppliers to reduce dependence on single sources of supply.