China overtakes US to become India’s top trading partner in FY24 (2024)

China has emerged as India's largest trading partner in the FY 2023-24 with $118.4 billion two-way commerce, narrowly edging past the US, according to the data of economic think tank GTRI. The bilateral trade between India and the US stood at $118.3 billion in 2023-24. Washington was the top trading partner of New Delhi during 2021-22 and 2022-23.

According to the report, India's exports to China rose by 8.7 per cent to $16.67 billion in the last fiscal. The main sectors which recorded healthy growth in exports to that country include iron ore, cotton yarn/fabrics/madeups, handloom, spices, fruits and vegetables, plastic and linoleum.

Imports from the neighbouring country increased by 3.24 per cent to $101.7 billion.

Meanwhile, exports to the US dipped by 1.32 per cent to $77.5 billion in 2023-24 as against $78.54 billion in 2022-23, while imports dipped by about 20 per cent to $40.8 billion, the report showed.

The Global Trade Research Initiative (GTRI) said that from fiscal year 2019 to FY2024, India's trade dynamics with its top 15 trading partners underwent significant transformations, impacting both exports and imports along with the status of trade surplus or deficit across various sectors.

It added that China witnessed a marginal decline in exports by 0.6 per cent, from USD 16.75 billion to USD 16.66 billion, while imports from China surged by 44.7 per cent, from USD 70.32 billion to USD 101.75 billion.

"This growth in imports led to an expanding trade deficit, rising from USD 53.57 billion in FY2019 to USD 85.09 billion in FY2024, highlighting concerns over stagnant exports amidst rising imports," GTRI Founder Ajay Srivastava said.

Trade with the US showed growth, with exports increasing significantly by 47.9 per cent from $52.41 billion to $77.52 billion, said the report.

Imports from the US also experienced a 14.7 percent increase, climbing from $35.55 billion to $40.78 billion. Consequently, India's trade surplus expanded, rising from $16.86 billion to $36.74 billion.

According to the Commerce Ministry data, China was India's top trading partner from 2013-14 till 2017-18 and also in 2020-21. Before China, the UAE was the country's largest trading partner. The US was the largest partner in 2021-22 and 2022-23.

In 2023-24, the UAE with USD 83.6 billion, was the third largest trading partner of India. It was followed by Russia ($65.7 billion), Saudi Arabia ($43.4 billion), and Singapore ($35.6 billion).

(With PTI inputs)

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