Shipments of finished electronics to intermediate chemicals from China rose sharply, pushing imports to a record $97.5 billion
India imported more than $16 billion of its top 100 imports from China last year, an increase of nearly two-thirds over the previous year, an analysis of trade data shows, underscoring its dependence on several important imports. Is.
India’s total imports from China crossed a record $97.5 billion last year, bringing a major chunk of bilateral trade to $125 billion, crossing the $100 billion mark for the first time, according to China’s general trade earlier this month. Figures issued by the Administration Customs (GAC) showed.
Of the 8,455 different types of items imported from China between January and November last year, according to an analysis by India’s ministry, a staggeringly diverse list includes everything from chemicals and electronics to auto components and textiles. 4,591 has increased. commercial data.
According to a study of data conducted by Santosh Pai, Honorary Fellow of the Institute of Chinese Studies in New Delhi, the top 100 items by value were valued at $41 billion, up from $25 billion in 2020. Most of the top 100 items – each of which contributed more than $100 million to the business, and included a range of electronic products, chemicals and auto components – showed sharp growth. The list included both finished and intermediate goods.
In the former category, integrated circuits grew by 147%, laptops and personal computers by 77% and oxygen therapy equipment by more than four times.
Intermediate products, especially chemicals, also registered significant growth. One of them, acetic acid, was increased more than eightfold.
Reasons for increasing imports include improving domestic demand for finished products from China and industrial reforms. The increase in India’s exports to the world has also increased the need for several important intermediate inputs, and disruptions elsewhere have led to more sourcing from China in the short term, for example in the case of coking coal earlier from Australia and Indonesia.
India’s record imports from China in 2021, amid a continuing political deadlock over the as-yet-unresolved crisis at the Line of Actual Control (LAC), has rekindled the debate over whether the trade ties and the widening deficit are sustainable. In the past 12 months, the value of India’s imports exceeded the total two-way trade in 2019 before the pandemic, according to GAC data.
‘Need to separate’
India is both sourcing a record number of finished goods such as electronics for the Indian market, while relying on China for a range of intermediate industrial products, many of which cannot be procured from elsewhere and India in substantial quantities. are not made in
If reliance on China has grown substantially over the past year, Mr. Pai observed that there is a need to differentiate between the different categories.
“If an increase in imports of finished goods such as toys, electronics, or furniture, which we can manufacture in India, is not a good dependency, then the fact that we are acquiring new intermediate goods, for example, may be a There is good growth. In the broader picture this means that we are emerging as a manufacturing hub and need new inputs to match the global demand for a finished Indian product,” Mr. Pai said.
“The second question is, which of these are short-term changes due to the disruption during the pandemic, and which are the long-term trends that we need to consider and tackle, and ask if we are still manufacturing in India instead of buying can start. China,” he said.
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