"I must, at this stage, mention the growing imbalance in our trade which is a cause of concern in India," Deputy Chief of the Planning Commission Montek Singh Ahluwalia said here, addressing the third Strategic Economic Dialogue (SED) forum.
"Trade is an important indicator of economic cooperation and we are happy at the remarkable expansion that has taken place," he said, expressing hope that bilateral trade would reach the official target of USD 100 billion by 2015.
"We recognise that trade does not have to be balanced between each pair of countries. However, India's trade deficit over the last three successive years has been in excess of USD 35 billion per annum which is not sustainable," he said.
It needs to be reduced to sustainable levels by more exports from India to China, and also by China building manufacturing capacities in India for goods it currently exports, Ahluwalia said.
Under Railways, the two sides agreed to pursue specific collaboration arrangements in heavy haul, station redevelopment and raising speed of existing trains in India. Nodal agencies have been designated to work out implementation of modalities in this regard, a press release issued at the end of the talks today said.
Highlighting India's competitive advantage in niche engineering products, IT-enabled services, cotton textiles and home furnishings, and pharmaceuticals, Ahluwalia said the two governments have a large role to play in pushing it up.
"I hope the Chinese government will help to provide our exports greater access to the market so that the target of USD 100 billion can be achieved in a more balanced manner," he said.
The bilateral trade touched USD 65.47 billion, a slight dip of 1.5 per cent year-on-year. The bilateral trade declined to USD 66.7 billion 2012 from around USD 74 billion in 2011.
Ahluwalia said both delegations which had formed five working groups had extensive and in-depth discussions on bilateral trade, investment, and economic cooperation and on the regional and global economic situation.
"Bilateral cooperation in sectors like railways infrastructure, information technology, energy and finance was emphasised. The two sides agreed to continue deepening bilateral coordination and engagement in multilateral frameworks like the United Nations, Group-20 and BRICS," a press release issued at the end of the talks today said.
Ahluwalia said: "These are proposals for railway station redevelopment, for raising the speed of passenger trains in India, and for heavy haul freight. Modernisation of Indian railway is a critical objective for India, which will contribute to energy efficiency and also climate sustainability."
Both sides decided to set up a task force under the SED to enable Chinese companies to invest in industries and industrial zones in India, according to the statement.
The two sides signed MOUs in Sustainable Urbanisation and on Cooperation in Information and Communications Technology. Action Plans on joint studies in sustainable urbanisation and energy planning were also signed for completion before the next round of the Dialogue, the statement said.
Ahluwalia said in his speech both China and India face a difficult international environment.
The world economy recovered quite quickly from the crisis in 2008 but it has been harder hit by the Eurozone crisis of 2011. There are positive signs over the past few months suggesting that the industrialised countries are beginning to recover. Developing countries have also been adversely affected by the global downturn, he said.