China has indicated its readiness to collaborate with India to resolve mutual economic and trade concerns. This statement follows comments made by Indian Finance Minister Nirmala Sitharaman, who highlighted Beijing’s restrictions on market access for Indian products as a significant factor contributing to the growing trade deficit. During a media briefing, Chinese foreign ministry spokesperson Mao Ning stated that China does not aim for a trade surplus and expressed a desire to work towards balanced economic relations.

Mao further suggested that any inquiries regarding the trade issues should be directed to the appropriate Chinese authorities. His remarks came in response to Sitharaman’s assertion that despite years of engagement, India’s trade imbalance with China and ongoing restrictions on market access for Indian goods remain pressing concerns.

Non-Tariff Barriers Highlighted by India

While addressing an interactive session with the Atlantic Council in Bangkok, Thailand, Sitharaman identified non-tariff barriers as the primary obstacle to trade between India and China. She emphasised that these barriers hinder Indian goods from entering the Chinese market, despite India’s competitive edge in various sectors such as generic medicines, bovine meat, and perishable products.

Sitharaman noted that India has been striving for nearly a decade to secure better access for its products in China, yet progress has been minimal. She pointed out that the persistent restrictions faced by Indian exporters are a significant concern, particularly in light of the substantial opportunities that exist in these sectors.

In her remarks, Sitharaman also criticised China’s implementation of phytosanitary measures and other non-tariff restrictions, arguing that these issues could be addressed through investigations and discussions between the two nations. She stated that India has opted not to impose punitive tariffs or countervailing duties to rectify trade imbalances, preferring to engage in negotiations instead.

Widening Trade Deficit Between India and China

The discussion comes in the wake of data released by China Customs, revealing that India’s trade deficit with China has expanded to $105.93 billion during the period from January to September, marking a 20.7 per cent increase compared to the same timeframe last year. The data also indicated that bilateral trade during these nine months rose by 25.4 per cent, reaching $144.45 billion.

Chinese exports to India surged by 23.3 per cent to $125.19 billion, while Indian exports to China increased by 40.7 per cent to $19.26 billion. Despite the notable growth in Indian exports, the significantly higher value of imports from China has resulted in a trade balance that heavily favours Beijing.

India has consistently sought improved access to the Chinese market, particularly for products in the information technology, pharmaceuticals, and agricultural sectors. However, Sitharaman reiterated that ongoing non-tariff barriers continue to restrict opportunities for Indian exporters.

Efforts to Enhance Trade Relations

This exchange occurs amid indications from New Delhi that it is keen to rebuild its economic relationship with Beijing. Union Commerce and Industry Minister Piyush Goyal recently stated that India is actively working to enhance ties with China, although the outcome of these efforts remains uncertain.

Commerce Secretary Rajesh Agrawal also mentioned that discussions on trade-related matters are ongoing between the two countries. He noted that continuous dialogue is essential for improving trade relations.

While China has expressed a willingness to address trade concerns in a balanced manner, India continues to underscore market access restrictions and the widening trade deficit as critical issues in its economic engagement with Beijing.

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