China has surged past the United States to regain its status as India's top trading partner, according to the latest data from the Global Trade Research Initiative (GTRI). In the fiscal year 2024, India's trade with China hit a whopping $118.4 billion, marking a 3.24% rise in imports reaching $101.7 billion and an 8.7% increase in exports hitting $16.67 billion.
Meanwhile, trade with the US saw a slight dip, with the total bilateral trade amounting to $118.3 billion in FY24. Indian exports to the US fell by 1.32% to $77.5 billion, and imports decreased by 20% to $40.8 billion.
India's economic connection with China has come under scrutiny due to heavy reliance on Chinese imports in critical sectors like telecommunications, pharmaceuticals, and advanced technology. The GTRI report highlighted this reliance, revealing that India imported $4.2 billion worth of telecom and smartphone parts, making up 44% of total imports in this category. Imports of laptops and PCs from China stood at $3.8 billion, accounting for 77.7% of India's imports in this sector.
In response, India has rolled out several measures to reduce this dependence, including production-linked incentive schemes (PLI), anti-dumping duties, and quality control orders. The import of lithium-ion batteries for electric vehicles, mainly from China, amounted to $2.2 billion, representing 75% of such imports and underlining China's crucial role in India's drive towards electric transport.
The report also highlighted significant shifts in trade dynamics with countries like Russia and Saudi Arabia. Russia saw a notable surge in trade figures, with exports skyrocketing by 78.3% and imports soaring by a staggering 952%, leading to a widened trade deficit.
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