India’s trade deficit with China has been bridged by about $9.5 billion in FY19 to $53.5 billion, but New Delhi wants deeper cuts this year.
Pushing for more action from the Chinese side to increase imports of agricultural commodities and certain other goods from India, Commerce Ministry officials will meet representatives from the General Administration of Customs of China (GACC) on Thursday in New Delhi to discuss ways to raise exports and close the bilateral trade gap further.
“The Chinese Vice-Minister of GACC will meet Commerce Secretary Anup Wadhawan on Thursday and the two are expected to discuss the extent to which the steps taken to increase India’s exports of farm goods to China have yielded results and what more needs to be done. Some protocols for agriculture exports may also be signed,” a government official told BusinessLine.
In FY19, India’s trade deficit with China narrowed a bit to $53.5 billion compared to $63 billion the previous fiscal, but that was partly due to a decline in China’s exports to India to $70.31 billion from $76.38 billion the previous year and an increase in Indian exports of some items such as organic chemicals, plastic raw materials and cotton yarn.
This followed assurances given by Chinese Premier Xi JinPing last year that his country would take concrete measures to address the problem of trade imbalance with India. China has also adopted a friendlier approach towards India after it got entangled in a trade war with the US. The Trump regime has threatened China with more retaliatory tariffs to be imposed on Friday.
“While India’s exports to China in FY19 went up to $16.75 billion from $13.33 billion, there wasn’t any significant increase in exports of agriculture and allied products except for certain items such as spices and marine products,” the official said.
Eye on potential exports
New Delhi believes that a bulk of the existing trade gap between India and China can be rectified through an increase in trade of not just the items already doing well, but where potential exists.
The Commerce Ministry, which has done a detailed analysis of the areas where there is scope for China to import more from India, submitted a list of 380 items earlier this year where export from the country could go up. These include agriculture, horticulture, pharmaceuticals, textiles, chemicals, tobacco and some engineering products.
While China has started importing grapes from India, a number of other fruits such as pomegranates, bananas, copra, pineapple and chillies are in the pipeline. Soyabean is another product where there is a huge scope for exports.
“We hope that the Chinese Minister takes forward discussions on at least some of these items and exports start soon,” the official said.
Source :- Thehindubusinessline.com