According to the data released by the China’s General Administration of Customs on 13 December, India’s trade deficit with China reached a record $29.5 billion in the period January-November 2013. The trade deficit with China in 2013 was higher than the trade deficit in 2012.
The numbers underline the sharp decline in once-burgeoning trade, which reached 74 billion dollar in 2011 when China became India’s biggest trading partner.
In 2012, India’s the trade deficit with China registered a 10% decline to reach 66.50 billion dollar, even as both the countries announced an ambitious 100 billion trade target to be achieved by 2015. The decline was partly the result of 20% slump in India’s exports, largely on account of iron ore mining bans by China and partly on account of global slowdown.
The latest figures have casted doubt on whether that target may be achieved. During the period January-November 2013, even as China’s trade with the rest of Asia as well as with its major Western trading partners has picked up, trade with India has remained in a slump. This suggests that causes were more structural rather than a reflection of global trends.
After 11 months of this year, India’s exports to China reached only 14.87 billion dollar out of total bilateral trade of 59.24 billion dollar. Trade between the two countries was down by 2.7% year-on-year, even as China’s overall global trade rose 7.7%. This was driven by an export sector that has continued to show signs of revival, growing 12.7% and marking the second straight month of rising exports.
Trade has grown more than 50 times since 2006, when the Nathu La pass between Sikkim and the Shigatse prefecture in Tibet was reopened. Most of the trade is made up of imports of Indian goods into Tibet, which reached 12 million dollar in 2012. Authorities said the border market is open for only six months of the year — opening on May 1 and closing on November 30.
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