India-China bilateral trade which was as low as US$ 2.92 billion in 2000 reached US$ 61.7billion in 2010, making China India’s largest goods trading partner. Since the beginning of the21st century, Trade between China and India has grown from less than$3 billion to nearly $100 billion, an increase of about 32 times. India’sannual exports to China crossed the $20-billion mark for the first time in 2020with shipments rising 16.15 per cent to $20.87 billion, per data collated from Indian and Chinese agencies.India’s major exports to China in the last six years were iron ore, petroleum fuels, organic chemicals, refined copper and cotton yarn.Among food items, some of the other major items exported were fish and seafood,pepper and vegetable oils and fats. Blocks of granite and other building stones and raw cotton were also among exports.
There are certain obstacles faced by Indian exporters in their attempts to capture the markets of China. Lack of information on customs procedures, imposition of excessive customs and other levies with frequent rate changes, complex customs valuation procedure, absence of a specified nodal agency, lack of transparency regarding technical standards, differentiated testing norms for imported and domestic products, unfamiliarity with regard to provincial rules and regulations, and frequent change in policies without any advance information on those changes are just some of those problems.India’s trade deficit with China accounts for about 50 per cent of the country's total trade deficit. Covid-19 has made the risks of the world's dependence on China impossible to ignore. Despite the on-going border military friction and the economic impact of the coronavirus pandemic Exports to China in India increased to 192.92 INRBillion in March from 125.01 INR Billion in February of 2021. India's exports to China has increased by 16.15 percent to USD 20.87 billion in 2020 from USD 17.9 billion in the previous year on account of healthy growth in the shipments of ores, iron and steel, aluminium and copper, according to the data ofthe commerce ministry. The bilateral trade in 2020 decreased by 5.64 per cent to 87.65 billion compared to USD 92.89billion in the previous year.
Chinese state media was quick to point out that Indian exports to China continued to rise because Beijing hasn’t politicised the border friction along the Line of Actual Control (LAC) in eastern Ladakh on-going since May while New Delhi has put curbs on Chinese exports. Conversely, India imported less from China during the same period, showing a 13% drop, the data quoted by state media showed. In June2021, China for the first time in decades started importing Indian rice largely because of an offer at discounted prices. Indian traders contracted to export100,000 tonnes of broken rice for December-February shipments at about $300 per tonne on a free-on-board basis. The purchase was a purely commercial move, as the price of the Indian rice - $300 per tonne - is far cheaper than that of its domestic counterparts, and the rice will mainly serve as animal feed rather than for humans Until April, the bilateral trade in goods between China and India in the first quarter of 2021 grew with the total trade volume reaching$27.7 billion; a year-on-year increase of 42.8%.India-China trade in 2020 had declined by 5.6% to $87.6 billion, the lowest since 2017. But China still overtook the US to become India’s largest trading partner last year. Chinese companies saw an increase in demand from India for medical equipment, especially oxygen concentrators, in the last couple of months following a devastating second wave of the coronavirus pandemic. The India Exports to China is projected to trend around 55.98 INR Billion in 2022, according to our econometric models.