How Important is China-India Trade Relations?

By | December 12, 2016

In spite of differences and unresolved issues, India and China are active business partners as neighboring Countries.

China may India suffer, but suffers hugely if we stop Business relations with China. China has established its policies to be a workshop of the world. China manufactures for fair pricing. Also it has the same product being manufactured at various level of cost and thus its quality. We would either be left with expensive western alternative or sub-standard Indian substitute in most of the cases, if in case we remotely even think of avoiding Chinese goods.

Especially, India is culturally either agrarian or trade oriented Country. India needs technical orientation and also technological bent of business acumen.

Apart from the rules of the game being associated with the WTO, India cannot neglect its one of the most profitable business partners. India too has a lot to lose if tomorrow we have adverse business relations with China. Indian exports mainly iron-ore, raw cotton, pharmaceuticals, fresh fruits, processed vegetables, marine foods, consumer durables, and much more to China. Moreover, it is going to start the export of basmati rice too. In contrast, Chinese export items to India include smartphones, decorative items, idols, electrical machinery, organic chemicals, cement, silk, crackers, and much more. India is boosting Agricultural and Pharma exports to China. India imports from China more than two times the value of what it exports to China. Hence we already have a trade deficit, meaning Imports are more than our Exports, in monetary terms.

To conclude, India China bilateral relations may be subject to a lot of important political issue, but it is very clear that more than China, India needs Chinese products in more than many ways.

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