India - China Trade Relationship: The Surprising Facts

Abstract

India and China are the fastest growing and emerging economies in the world started their bilateral trade relationship during 1950s. Both countries attained the recognition of international community for their role in international financial affairs and also these countries have some common elements like large territorial area, high population and separated by common border etc.The objective of the present study is to analyze the different aspects of India- China economic and trade relations. It focuses on the position of China as a trading partner to India and along with this, the study also try to understand the trend of India – China export, import and its composition. For this purpose, the data are collected from Directorate General of Commercial Intelligence & Statistics (DGCI&S) and Ministry of Commerce and Industry, Government of India and the analysis was done by using appropriate tables and graphs related to the collected trade data. The study found that china holds a critical position with India on its trade relations, both export and import terms. Both countries are engaging in the export and import of many commodities. The data reveals that China is the largest importer of our country. Our export to china is quite scanty as we compare this share with China’s import. It is not a good sign to our economic development as the trade deficit is widening year by year. Constant attention is needed to reduce this deficit by expanding our export to China for the coming years. The mutual opening of banking and other business enterprises in both countries are appreciable as it can enhance our economic relationship.