Despite Border Tensions, India-China Trade Reaches New Heights in 2023-24

Despite India’s insistence that normalizing relations with China hinges on resolving the ongoing four-year border standoff in eastern Ladakh, trade between the two countries has continued to rise, favoring China.

China has become India’s largest trading partner, with bilateral trade reaching $118.4 billion in 2023-24, slightly surpassing the US, according to a report by the PTI news agency on May 12, citing data from the Global Trade Research Initiative (GTRI).

For the previous two fiscal years, the US held the top spot as India’s trading partner. However, China now enjoys a significant trade surplus with India. The data shows that India’s exports to China increased by 8.7% to $16.67 billion in the last fiscal year. Key sectors driving this growth include iron ore, cotton yarn/fabrics/made-ups, handloom, spices, fruits and vegetables, plastic, and linoleum.

Imports from China also rose by 3.24% to $101.7 billion. This surge in imports has widened India’s trade deficit with China, increasing from $53.57 billion in FY2019 to $85.09 billion in FY2024.

“This growth in imports led to an expanding trade deficit in India, highlighting concerns over stagnant exports amidst rising imports,” noted GTRI Founder Ajay Srivastava.

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