US-India growth in trade, an eye-opener for China

Mumbai – The US has surpassed China to become India’s largest trading partner. It was an eye-opener for China, which came after the 2022-23 trade year details were revealed. China’s Consul General Kong Xianhua admitted that there was a huge gap in bilateral trade with India, and compared to China’s exports to India, India’s exports to China were negligible. However, Xianhua defended his country, saying that these figures do not explain everything and India can increase exports to China through Make in India.

India has been facing a deficit of about $101 billion in bilateral trade with China. Despite India’s repeated demands, China has not opened the pharmaceuticals, IT and agriculture sectors to Indian industries. If that happens, the country has been worried that India will capture China’s market in the region. Hence, China, which has fully taken advantage of the Indian market on the one hand, is not ready to allow India to enter this field on the other hand. Thus, bilateral trade has tilted in China’s favour.

After it became clear that this trade deficit had reached $101 billion, China had to take note of this reluctantly. In this, the US has overtaken China to become the largest trading country with India. China has realised that the US will get more business opportunities in India in the future, which may affect them. Therefore, speaking at the trade summit, Consul General Kong Xianhua presented India with a potential solution to increase exports to China through ‘Make in India’.

At the same time, Xianhua claimed that although India has to bear a huge deficit in bilateral trade with China, these statistics do not explain everything. The raw materials needed for India’s exports to other countries go to India from China. Therefore, Kong Xianhua pointed out that India’s exports to other countries depend on Chinese raw materials.

At the same time, Xianhua advised his merchants to develop friendly relations with Indian merchants and try to win their hearts. Also, Xianhua suggested that the Chinese industry should leverage India’s IT and film production expertise, as India has been a leader in these areas. Meanwhile, India has so far succumbed to China’s delusions and ignored the unfairness in bilateral trade. But there have been indications that it will hit China very hard in the future.

After the conflict in Galwan, China has become a target of contempt among Indians. Yet India’s heavy reliance on China for raw materials persists due to the neglect of the manufacturing sector in the past. But this situation is starting to change, and the Indian industry seems to be reducing its dependence on China. However, this process expects to take time and will only happen slowly. Till then, China will take advantage of trade with India. However, in the coming years, there are claims that China will not benefit from India’s trade generosity.

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