The India-China bilateral trade last year touched a historic high of USD 95.54 billion, raising hopes that the trade this year could cross the historic USD 100 billion mark.
The bilateral trade between India and China has declined by 3.59 per cent year on year, totalling USD 36.87 billion in the first five months of this year, denting optimism that the total trade volume may cross USD 100 billion mark in 2019. The India-China bilateral trade last year touched a historic high of USD 95.54 billion, raising hopes that the trade this year could cross the historic USD 100 billion mark.
The trade deficit in 2018, according to Chinese official data, climbed to USD 57.86 billion from USD 51.72 billion in 2017. As per the latest data released by Chinese customs, the bilateral trade in the first five months of 2019 has declined by 3.59 per cent year on year amounting to USD 36.87 billion. In the same period, India’s exports to China declined by 1.62 per cent to reach USD 7.70 billion while Chinese exports to India decelerated by 4.10 per cent to total USD 29.17 billion.
In May this year, the bilateral trade declined by a significant 5.04 per cent, totalling USD 8.18 billion year on year. India’s exports to China in May 2019 stood at USD 1.52 billion, decreasing by 7.15 per cent, while Chinese exports have declined by 4.54 per cent, standing at USD 6.66 billion. After the bilateral trade crossed USD 95 billion last year which was a historic high, officials in recent months expressed optimism that the bilateral trade for the first time may cross USD 100 billion. But the trend of decline may make it difficult unless the trade volumes picks up later in the year.
Major growth commodities of India’s export basket in the period January-May 2019 were organic chemicals at 23.56 per cent, cotton 50.73 per cent, plastics 25.48 per cent, fish and crustaceans 394.97 per cent, electrical machinery 33.54 per cent, Iron and steel 39.12 per cent and coffee, tea, mate and spices 654.22 per cent, according to the official data. Export of commodities such as natural earls, precious stones, copper, mineral fuel declined by 29.65 per cent, 89.21, 39.38 per cent respectively from January-May period.
Indian exports of fish and crustaceans, molluscs and other aquatic invertebrates to China continued to show a sharp increase, registering a robust growth of 394.97 per cent from January-May 2019 to reach USD 392.38 million. Export of Indian grapes to China grew by 165.28 per cent year-on-year to reach USD 13.26 million. Export of Indian sugar to China stood at USD 7.77 million.
India was the largest exporter of coffee, tea, mate and spices to China (46.97 per cent share) with value of USD 168.42 million. This was mainly due to the growth in exports to China of spices, having more than 90 per cent share totalling USD 156.86 million. India was the third largest exporter of fisheries 6.98 per cent share, fifth largest exporter of fresh grapes 2.68 per cent share, and cane and beet sugar to China 2.12 per cent share.
Major commodities of Chinese exports to India were electronic items 26.12, per cent, electrical equipment, organic chemicals, plastics and fertilizers. Import of electrical machinery and equipment have been witnessing decline of more than 20 per cent year-on-year for the last 4 months. Imports of fertilisers from China showed a sharp increase of 233.17 per cent to reach USD 512.39 million in January-May, 2019. India remained the largest export destination for Chinese fertilizers.
Among India’s top exporting items to China, exports of fish and crustaceans, molluscs and other aquatic invertebrates sustained a rising momentum. With an increase of 394.97 per cent, India overtook Australia and ascended to the fourth largest exporter of fish and crustaceans, molluscs and other aquatic invertebrates to China USD 392.38 million with a share of 6.57 per cent.
Exports of coffee, tea, mate and spices enjoyed robust growth and witnessed a steep increase of 654.22 per cent to reach USD 168.42 million with a share of 46.97 per cent, securing India as the first largest exporter of coffee, tea, mate and spices to China, according to the data.
India’s cotton (including yarn and woven fabric) exports to China showed an increase of 50.73 per cent to reach USD 837.90 million. With a market share of 18.19 per cent India was the second largest exporter of cotton to China. Despite a decrease of 29.34 per cent, India was still the second largest exporter of diamonds to China amounting to USD 808.55 million with a share of 24.63 per cent, just after South Africa.
India was the second largest exporter of salt; sulphur, earths and stone, plastering materials, lime and cement to China amounting to USD 419.75 million with 12.54 per cent market share. Agricultural items, exports of other solid residues of soybean oil extraction, retained an increase of 182.36 per cent to reach USD 0.15 million, although China’s imports from global partners slumped.
India was the second largest exporter of other solid residues of soybean oil extraction to China. India still ranked the fifth largest exporter of fresh grapes and cane or beet sugar to China. Exports of fresh grapes increased by 165.28 per cent to reach USD 13.26 million and exports of cane or beet sugar increased by 227.67 per cent to reach USD 7.77 million. Exports of rice to China sustained a steep increase of 9,999 per cent to reach USD 0.115 million, registering a breakthrough compared to the same period of last year, according to the data.