China beats US to re-emerge as India’s top trading partner, India's trade deficit with China widens to $1.26 billion in July

[beijingwalker]

China beats US to re-emerge as India’s top trading partner, India's trade deficit with China widens to $1.26 billion in July​

The trade deficit with China is widening as exports shrank 44% to $1.26 billion in July.

Updated: 16 Sep 2022, 06:08 AM IST

NEW DELHI/BENGALURU : China overtook the US to return as India’s largest trade partner with $11.49 billion worth of goods traded in July, data released by the commerce ministry showed, underscoring the country’s growing reliance on its northern neighbour.

In comparison, trade with the US stood at $11.08 billion in July, amid a demand slowdown and recession fears in the US.

The growth in trade with China is largely on account of a surge in imports and near-flat growth in exports to the US during the month. Exports to the US in July grew by 0.41% to $6.78 billion, while imports from China expanded by 45% to $10.2 billion.

The department of commerce had earlier contested China’s official data that showed Beijing was India’s largest trading partner in 2021-22. Delhi countered it, saying the US was India’s largest trading partner that year.

The US, however, remained India’s largest trading partner in the four months ended 31 July, with shipments worth $46.2 billion, more than China’s $40.4 billion.

Meanwhile, the trade deficit with China is widening, with exports to the neighbouring nation contracting 44% to $1.26 billion in July, increasing the trade gap to nearly $9 billion, which is about a third of India’s overall trade deficit during the month. Exports declined even on a month-on-month basis.

“Exports to China may have declined for two reasons. First, China may be imposing some non-tariff measures and, second, exports from countries with whom China has a trade agreement may have an advantage over our exporters," said Arpita Mukherjee, professor, ICRIER.

In April-July, India’s outbound shipments to China declined by 33% from a year ago. Incidentally, India’s imports from China grew by 16% in July from June’s $8.8 billion. Major imports from China in July included ‘coke and semi-coke of coal’, antibiotics, fertilizers, silver, parts for motor vehicles, electrical transformers, air and vacuum pumps, printing machinery, and electrical apparatus for line telephone.

About $154 million worth of silver was imported from China in July, growing more than 20,000 times when compared with a year ago. Air and vacuum pump imports rose 82% in July to $111 million. Refrigerator and air conditioner imports rose by 90% to $49 million during the month. Electrical transformer imports grew 22% to $120 million. Electronic integrated circuits imports stood at $425 million but were 3.2% lower than the year earlier. Imports of parts of motor vehicles grew by 62% to $119 million.

Biswajit Dhar, a professor at Jawaharlal Nehru University, said import dependence on China is consistently rising as the Indian economy regains its growth momentum. “Over the past couple of years, the government has taken several measures to beef up domestic manufacturing capacities, including through the PLI scheme, so that import dependence on China can be reduced. But these measures have not been effective," he added.

A commerce department official said while the decline in exports to Beijing is largely due to a change in the direction of India’s exports away from China, the growth in imports from China has largely been driven by imports of capital goods and intermediate goods. Imports of consumer goods and raw materials constitute a smaller fraction of total imports from China, he said. He added that major items like chemicals used in industrial products imported from China are used in meeting growing demands for industrial inputs. Imports like active pharmaceutical ingredients and drug formulations provide the Indian pharma industry with raw material for producing finished goods, which are then exported, he said.

Reflecting a sharp US demand slowdown, India’s exports also saw an 8% sequential fall in July to $6.7 billion, from $7.3 billion worth of shipments in June. On the other hand, in April-July, imports from the US have grown by 35%.

Diamond exports to the US fell 16% to $832 million in July from a year ago. Jewellery with artificial stones’ exports at $258 million is 28% lower than last year. Turbojets exports at $51 million are 46% lower y-o-y. Electrical transformer exports at $60 million are 14% lower than last year. However, tractor exports doubled to $55 million. Parts and accessories of motor vehicles exports at $182 billion were up 8% over the previous year.

Ajay Sahai, director general of the Federation of Indian Export Organisations, said India has a very balanced growth in exports and imports with the US, unlike China, where our exports have taken a hit while import growth remains unabated. However, in our overall imports also, China’s share has come down from 15.5% in FY22 to 13.5% in April-July 2022, which is quite significant.

Anil Bhardwaj, secretary general of the Federation of Indian Micro and Small and Medium Enterprises, said India’s manufacturing relies very strongly on China. “These PLI schemes in chemical, electronics and several other sectors are brought out to address these issues. So, most of these schemes have not taken off. So, in the short-to-medium term, the reliance on China will continue," he said.

China beats US to re-emerge as India’s top trading partner

Reflecting a sharp US demand slowdown, India’s exports also saw an 8% sequential fall in July to $6.7 bn, from $7.3 bn in June

www.livemint.com

 

[beijingwalker]

India is growing fast, in trade deficit.

 

[my2cents]

China beats US to re-emerge as India’s top trading partner, India's trade deficit with China widens to $1.26 billion in July​

The trade deficit with China is widening as exports shrank 44% to $1.26 billion in July.

Updated: 16 Sep 2022, 06:08 AM IST

NEW DELHI/BENGALURU : China overtook the US to return as India’s largest trade partner with $11.49 billion worth of goods traded in July, data released by the commerce ministry showed, underscoring the country’s growing reliance on its northern neighbour.

In comparison, trade with the US stood at $11.08 billion in July, amid a demand slowdown and recession fears in the US.

The growth in trade with China is largely on account of a surge in imports and near-flat growth in exports to the US during the month. Exports to the US in July grew by 0.41% to $6.78 billion, while imports from China expanded by 45% to $10.2 billion.

The department of commerce had earlier contested China’s official data that showed Beijing was India’s largest trading partner in 2021-22. Delhi countered it, saying the US was India’s largest trading partner that year.

The US, however, remained India’s largest trading partner in the four months ended 31 July, with shipments worth $46.2 billion, more than China’s $40.4 billion.

Meanwhile, the trade deficit with China is widening, with exports to the neighbouring nation contracting 44% to $1.26 billion in July, increasing the trade gap to nearly $9 billion, which is about a third of India’s overall trade deficit during the month. Exports declined even on a month-on-month basis.

“Exports to China may have declined for two reasons. First, China may be imposing some non-tariff measures and, second, exports from countries with whom China has a trade agreement may have an advantage over our exporters," said Arpita Mukherjee, professor, ICRIER.

In April-July, India’s outbound shipments to China declined by 33% from a year ago. Incidentally, India’s imports from China grew by 16% in July from June’s $8.8 billion. Major imports from China in July included ‘coke and semi-coke of coal’, antibiotics, fertilizers, silver, parts for motor vehicles, electrical transformers, air and vacuum pumps, printing machinery, and electrical apparatus for line telephone.

About $154 million worth of silver was imported from China in July, growing more than 20,000 times when compared with a year ago. Air and vacuum pump imports rose 82% in July to $111 million. Refrigerator and air conditioner imports rose by 90% to $49 million during the month. Electrical transformer imports grew 22% to $120 million. Electronic integrated circuits imports stood at $425 million but were 3.2% lower than the year earlier. Imports of parts of motor vehicles grew by 62% to $119 million.

Biswajit Dhar, a professor at Jawaharlal Nehru University, said import dependence on China is consistently rising as the Indian economy regains its growth momentum. “Over the past couple of years, the government has taken several measures to beef up domestic manufacturing capacities, including through the PLI scheme, so that import dependence on China can be reduced. But these measures have not been effective," he added.

A commerce department official said while the decline in exports to Beijing is largely due to a change in the direction of India’s exports away from China, the growth in imports from China has largely been driven by imports of capital goods and intermediate goods. Imports of consumer goods and raw materials constitute a smaller fraction of total imports from China, he said. He added that major items like chemicals used in industrial products imported from China are used in meeting growing demands for industrial inputs. Imports like active pharmaceutical ingredients and drug formulations provide the Indian pharma industry with raw material for producing finished goods, which are then exported, he said.

Reflecting a sharp US demand slowdown, India’s exports also saw an 8% sequential fall in July to $6.7 billion, from $7.3 billion worth of shipments in June. On the other hand, in April-July, imports from the US have grown by 35%.

Diamond exports to the US fell 16% to $832 million in July from a year ago. Jewellery with artificial stones’ exports at $258 million is 28% lower than last year. Turbojets exports at $51 million are 46% lower y-o-y. Electrical transformer exports at $60 million are 14% lower than last year. However, tractor exports doubled to $55 million. Parts and accessories of motor vehicles exports at $182 billion were up 8% over the previous year.

Ajay Sahai, director general of the Federation of Indian Export Organisations, said India has a very balanced growth in exports and imports with the US, unlike China, where our exports have taken a hit while import growth remains unabated. However, in our overall imports also, China’s share has come down from 15.5% in FY22 to 13.5% in April-July 2022, which is quite significant.

Anil Bhardwaj, secretary general of the Federation of Indian Micro and Small and Medium Enterprises, said India’s manufacturing relies very strongly on China. “These PLI schemes in chemical, electronics and several other sectors are brought out to address these issues. So, most of these schemes have not taken off. So, in the short-to-medium term, the reliance on China will continue," he said.

China beats US to re-emerge as India’s top trading partner

Reflecting a sharp US demand slowdown, India’s exports also saw an 8% sequential fall in July to $6.7 bn, from $7.3 bn in June

www.livemint.com

China imports less from India. China also does not invest much in india. It is double whammy for India. We should wean away from dependence on China for cheap imports that we can manufacture in India.

 

[beijingwalker]

China imports less from India. China also does not invest much in india. It is double whammy for India. We should wean away from dependence on China for cheap imports that we can manufacture in India.

I agree, and good luck with it.

 

[my2cents]

I agree, and good luck with it.

What is your opinion about investing in India? Singapore is our biggest investing country. Why does China shy away?

 

[beijingwalker]

What is your opinion about investing in India? Singapore is our biggest investing country. Why does China shy away?

Indian government keep harassing Chinese companies in India, who the hell in their sane mind would reinvest in India? US is not a friend of China, but China doesn't raid US companies in China, India's self defeating policies have only themselvs to blame, China has tons of money and we can invest somewhere else in the developing world.

India’s frequent investigations into Chinese firms chill investment confidence: embassy - Global Times

www.globaltimes.cn

China says India risks scaring away investors with raids on its companies

India risks damaging its reputation among foreign investors with its "frequent investigations" into Chinese companies, Beijing said this week.

edition.cnn.com

 

[MH.Yang]

China imports less from India. China also does not invest much in india. It is double whammy for India. We should wean away from dependence on China for cheap imports that we can manufacture in India.

Most of India's exports to China come from factories invested by China in India. After these factories leave India, India's exports to China will certainly decrease.

Most of India's exports and imports to the United States come from the service industry, which is of course easier to balance. India's imports from China are mostly necessities or upstream raw materials. These imports can hardly be reduced and balanced, and with the arrival of the global inflation wave, they will even become larger and larger.

 

[my2cents]

Indian government keep harassing Chinese companies in India, who the hell in their sane mind would reinvest in India?

India’s frequent investigations into Chinese firms chill investment confidence: embassy - Global Times

www.globaltimes.cn

China says India risks scaring away investors with raids on its companies

India risks damaging its reputation among foreign investors with its "frequent investigations" into Chinese companies, Beijing said this week.

edition.cnn.com

These issues often come with the territory. They are not targeted at Chinese companies but they do have a chance to appeal in courts.

 

[my2cents]

Most of India's exports to China come from factories invested by China in India. After these factories leave India, India's exports to China will certainly decrease.

Most of India's exports and imports to the United States come from the service industry, which is of course easier to balance. India's imports from China are mostly necessities or upstream raw materials. These imports can hardly be reduced and balanced, and with the arrival of the global inflation wave, they will even become larger and larger.

I am aware of these drawbacks with our exports to China because you not only produce goods for the entire world but you do it more efficiently. Efficiency and scale plays a major role in competitive trade. That is a tough nut to crack.

 

[MH.Yang]

These issues often come with the territory. They are not targeted at Chinese companies but they do have a chance to appeal in courts.

Although we are Chinese, we still heard of the bad reputation of Indian courts.

Even if these companies can obtain public judgments and win lawsuits, the court will not give a verdict until decades later. What's the difference between this and losing a lawsuit?

With the signing of RCEP, these companies have more opportunities in Southeast Asia, and there is no need for them to stay in India.

 

[Chat SAMOSA]

India is growing fast, in trade deficit.

As long as China keeps supplying stuff cheap and India is paying them a reasonable price, what are you complaining about ?

 

[MH.Yang]

I am aware of these drawbacks with our exports to China because you not only produce goods for the entire world but you do it more efficiently. Efficiency and scale plays a major role in competitive trade. That is a tough nut to crack.

You should learn from Vietnamese. They have enough courage to face challenges, so they can win real opportunities.

As for the relationship between China and India, is it worse than that between China and Vietnam?

The Chinese have slaughtered Vietnam for thousands of years. Now Chinese warships only chase Vietnamese ships in the South China Sea and never harass other countries' ships.

In this case, Vietnamese can also distinguish politics from economy.

Indians always tie economic problems with political problems, and finally lose economic opportunities due to political conflicts.

Facing RCEP, Indians are afraid of competition and loss of domestic market, while Vietnamese are not afraid. Vietnamese can't even build tractors. Can Indians be inferior to Vietnamese?

However, Vietnamese have avoided competition by becoming a part of China's industrial chain. Their export data has grown from 170 billion dollars in 2016 to 340 billion dollars in 2021, an increase of 100% in five years.

 

[Rollno21]

China imports less from India. China also does not invest much in india. It is double whammy for India. We should wean away from dependence on China for cheap imports that we can manufacture in India.

Dependence on China cannot be reduced over night ,it takes time. We are working on reducing imports from China one step at a time.

Usually around this time you would see Chinese goods flooding the Indian market ,even fire crackers and lights were imported ,but now a days you don't see that happening.

Year on year if you see the list of items being imported from China keeps reducing,previously we even used to import plastic spoons and ice cream spoons from China.

 

[MH.Yang]

Dependence on China cannot be reduced over night ,it takes time. We are working on reducing imports from China one step at a time.

Usually around this time you would see Chinese goods flooding the Indian market ,even fire crackers and lights were imported ,but now a days you don't see that happening.

Year on year if you see the list of items being imported from China keeps reducing,previously we even used to import plastic spoons and ice cream spoons from China.

That's because China is eliminating labor-intensive enterprises due to population problems, and Chinese enterprises have moved the factories producing ice cream spoons to Southeast Asia. So India now imports ice cream spoons from Vietnam.

 

[beijingwalker]

Year on year if you see the list of items being imported from China keeps reducing,previously we even used to import plastic spoons and ice cream spoons from China.

They are being replaced by cars and airplanes