InvestorQ : Is it true that India has reduced its trade deficit with China?
Tisha Malhotra made post

Is it true that India has reduced its trade deficit with China?

Answer
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diksha shah answered.
1 week ago


While it is true that the trade deficit with China has reduced, I am not sure if that is out of genuine trade shifts or because the overall imports into India have come down in the recent past due to virtual inactivity in the light of the Coronavirus pandemic.

Let us look at the numbers. India’s trade deficit with China dipped sharply in the Jun-20 quarter from $13.11 billion to $5.48 billion which is a fall of about 60%. However, it remains to be seen if this narrowing can be sustained once the normal trade activity picks up.

The total bilateral trade, aggregate of exports and imports, fell by nearly 25% from $21.42 billion to $16.55 billion for the Jun-20 quarter. Indian government had made a conscious effort to reduce the imports from China and to increase its exports to balance trade.

While 550 products were under import restrictions, it must be noted that China had deliberately given a boost to Indian steel exports to partially compensate for the diplomatic differences caused and manifested in the Ladakh border.