India’s Exports to China set to touch record high as market access widens

India’s export to China is expected to reach an all-time high during the current financial year with the US-China trade war creating new opportunities for exporters and Beijing removing some trade barriers in its effort to check the growing bilateral trade imbalance.

The growth in trade between the two countries is driven by marine products, organic chemicals, plastics, petroleum products, grapes and rice, according to an official release of the Commerce Ministry.

“India’s exports to China have grown after several years. India is poised to achieve its highest ever exports to the country this fiscal. Between April and December 2018, exports were 12.7 billion US Dollars which is closer to last year’s exports of 13.33 billion US Dollars,” the release said.

The commerce ministry, however, believes that more efforts are required for greater market penetration in China. “India is hopeful of soon signing protocols for export of Indian soya bean meals, cakes and pomegranates to China in the near future, as these are in advanced stages of discussion,” the release added.

Discussions are on with the Chinese for early announcement of import quotas for sugar and rice for 2019 so that Indian exporters are able to plan their exports well in time, it said.

India’s trade deficit with China was a huge $63 billion in 2017-18, which was more than a third of the country’s total trade deficit, with exports to China at $13.3 billion and imports from the country at $76.38 billion.

India has been pressing hard with Chinese interlocutors to provide more market access of Indian goods like rice pharmaceuticals and marine products in a bid to reduce the growing trade deficit between the two countries

Acknowledging the need to take steps to check the deficit, China signed three export protocols on rice, fishmeal and tobacco — to allow imports of the three items.

New Delhi is hopeful that the new protocols being discussed would boost India’s exports further and rein in the deficit.

Discussions are also on for early announcement of Chinese import quotas for sugar and rice for 2019 so that Indian exporters are able to plan their exports well in time.

Department of Commerce took the initiative to identify and share with Indian exporters and other stakeholders, specific lines where the US will lose competitiveness in China and where India had an export potential, according to the release.