Indian exports, mainly driven by cotton and iron ore to China amounted to USD 20.8 billion while Chinese exports to India totalled to USD 40.8 billion, virtually double that of Indi
Bilateral trade between India and China exceeded the two countries' $60 billion target last year, driven largely by rising Indian imports of Chinese machinery that have left a record trade imbalance of $20 billion in China's favour.
Figures released for last year showed that bilateral trade in 2010 reached $61.7 billion, with Chinese exports to India touching $40.8 billion.
This marked a 43 per cent jump in trade volume from last year, when the recession reduced two-way trade to $43 billion. In 2008, China became India's largest trade partner with $51.8 billion in bilateral trade.
Despite the growth, the figures underscore rising Indian concerns over the fast-widening trade deficit, with Indian exports, largely made up of iron ore, other raw materials and cotton, contributing a little over $20 billion — equalling the size of the deficit.
Indian officials have pressed China, most recently during Premier Wen Jiabao's December visit to New Delhi, to address the growing deficit by providing better market access for Indian pharmaceutical and Information Technology companies here which have struggled to penetrate the Chinese market.
Officials say the deficit is otherwise likely to widen even further in the coming year, with iron ore sales, which have driven Indian exports, expected to fall with the recent ban in Karnataka. India is China's third biggest supplier of iron ore, behind Brazil and Australia. But following the ban, Chinese importers have increasingly diversified their imports, seeking out new markets such as South Africa and Ukraine.
China, in contrast, exports finished goods to India, mainly machinery. Growing demand for Chinese telecom and power equipment has fuelled the growth in trade.
Indian officials say the one bright spot in the coming year could come from Indian pharmaceutical companies, with China set to accelerate a $2-billion reform in its healthcare sector in coming months. Officials from China's State Food and Drug Administration made a recent visit to India, with a delegation of Indian pharmaceutical companies scheduled to visit China in March.
China's Health Minister Chen Zhu said last year the country welcomed Indian pharmaceutical companies, known here for their cost- competitiveness, to help address the growing demands of the China market.
“We know India's pharmaceutical sector, including non-generic and creative medicine, is leading the developing world,” he said, adding that “China has a huge market potential for healthcare services and medicine. We more than welcome pharmaceutical companies from countries like India to China.”
Comments:
A very significant export to China which is in a growth demand is "girls" or Women. Because of the potential shotage of this "product", there is a growing demand. It is time that India consider placing an export TAX on this "product" This seems strange but China first then India will be running a shortage of women. The apparent cause id that both cultures have praised the son senior. Each culture desire son(s) now because of the shortage of girls, the demand will increase. The price of that demand is yet to be realised.
i am not a pessimist but the way china has been increasing the trade deficit is suspicious.
why on earth is indian government hell bent on providing indian market to chinese suppliars.
Being an electronics and communications engineer i very well know that job opportunities in electronics manufacturing sector is so scant.
I heard when i was in engineering that GOI is planning for multiple electronic manufacturing SEZ....... Where has all the plans gone?????
India have to increase its exports to China then-only the trade between the two countries will be fair.
sir,
So huge deficit! must be an issue of urgent wake up call for the political and economic community of our country. the economic and trade community must graduate from mere exporting primary goods i.e.iron ore . the leaders and diplomats must everything required to expand this export basket.they should also ask china to remove bottle necks in the export of the fruits and agriculture-products.politically this imbalance of trade in china's favor must be used as a leverage to solve the contentious between both the countries.
This is a huge imbalance in trade prospective mostly because of lack of infrastructure facilities and tight rules for foreign investment.Companies are finding it difficult to enter into the Indian market.I hope recents events in bilateral trade will be a win-win for both the countries.
Failure of our heavy industies are cause of this trade gap. Large extent of these heavy machinery import was avoidable, especially in power sectors, had these companies been competitive. We should blame companies like BHEL, L&T, TATA, SAIL..... it is a big list. These companies never had a vision to participate in India's growth and they were fighting each other and killing manufacturing industies in India.
This is Unfair trade on two counts.: 1.Exports are worth app.20 Bn.and the Imports 40 Bn. 2.The exports are like Ore mines and Cotton - raw materials. And the Imports are finished goods. What is this kind of trade,which is very much tilted in favour of China?