{"id":45846,"date":"2025-04-17T06:09:44","date_gmt":"2025-04-17T00:39:44","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=45846"},"modified":"2025-05-08T02:57:00","modified_gmt":"2025-05-07T21:27:00","slug":"indias-trade-with-us-and-china","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/indias-trade-with-us-and-china\/","title":{"rendered":"India\u2019s Trade with US and China: Exports Surge, Trade Deficit Widens"},"content":{"rendered":"<h2>What\u2019s in Today\u2019s Article?<\/h2>\n<ul>\n<li>India Trade Deficit Latest News<\/li>\n<li>Overall Trade Snapshot (FY25)<\/li>\n<li>India\u2013US Trade Registers Strong Growth in FY25<\/li>\n<li>China Remains India\u2019s Second-Largest Trading Partner<\/li>\n<li>Conclusion<\/li>\n<li>India Trade Deficit FAQs<\/li>\n<\/ul>\n<h2>India Trade Deficit Latest News<\/h2>\n<ul>\n<li>In 2024\u201325, the US remained India\u2019s <strong>largest trading partner<\/strong> for the fourth consecutive year, with bilateral trade reaching $131.84 billion. China retained its position as the second-largest partner, with trade growing to $127.7 billion.<\/li>\n<li>However, India\u2019s trade deficit with China widened significantly to $99.2 billion, a 17% increase from the previous year.\u00a0<\/li>\n<li>Historically, China was India\u2019s top trading partner between 2013\u201314 and 2017\u201318, and again in 2020\u201321. The US has held the top spot since 2021\u201322.<br \/>\n\u00a0<\/li>\n<\/ul>\n<h2>Overall Trade Snapshot (FY25)<\/h2>\n<ul>\n<li>Goods exports remained flat at $437.42 billion (vs $437.07 billion in FY24).<\/li>\n<li>Imports rose by 7% to a record $915.19 billion.<\/li>\n<li>Services exports grew 12.45% to $383.51 billion, maintaining a healthy surplus with imports at $195.95 billion.<\/li>\n<\/ul>\n<h3>Sector-Wise Performance<\/h3>\n<ul>\n<li>Coffee exports surged 40% to a record $1.8 billion, driven by global shortages and high prices.<\/li>\n<li>Electronic goods exports jumped 32% to $38 billion, boosted by iPhone manufacturing in India.<\/li>\n<li>Drugs, pharmaceuticals, fruits &amp; vegetables, cereal preparations saw 5\u201310% growth.<\/li>\n<li>Exports of gems &amp; jewellery, handicrafts, chemicals declined by 2\u201310%.<\/li>\n<li>Engineering goods exports grew 6.74% overall, but dipped 4% in March.<\/li>\n<\/ul>\n<h3>Challenges Ahead for Engineering Exports<\/h3>\n<ul>\n<li>US tariffs on iron &amp; steel and auto components may reduce annual engineering exports by $4\u20135 billion.<\/li>\n<li>Increasing competition from Chinese exporters in global markets like Latin America, Africa, and the Middle East may erode profit margins for Indian firms.<\/li>\n<\/ul>\n<h2>India\u2013US Trade Registers Strong Growth in FY25<\/h2>\n<ul>\n<li>India\u2019s exports to the US rose by 11.6%, reaching <strong>$86.51 billion in 2024\u201325<\/strong> (up from $77.52 billion in FY24).<\/li>\n<li>Imports from the US increased by 7.44% to $45.33 billion (up from $42.2 billion).<\/li>\n<li>Resulting trade surplus for India stood at $41.18 billion, an increase from $35.32 billion in the previous year.<\/li>\n<\/ul>\n<h3>Top Indian Exports to the US in 2024\u201325<\/h3>\n<ul>\n<li>Drug formulations &amp; biologicals \u2013 $8.1 billion<\/li>\n<li>Telecom instruments \u2013 $6.5 billion<\/li>\n<li>Precious &amp; semi-precious stones \u2013 $5.3 billion<\/li>\n<li>Petroleum products \u2013 $4.1 billion<\/li>\n<li>Gold &amp; precious metal jewellery \u2013 $3.2 billion<\/li>\n<li>Readymade garments (mostly cotton) \u2013 $2.8 billion<\/li>\n<li>Iron &amp; steel products \u2013 $2.7 billion<\/li>\n<\/ul>\n<h3>Major US Exports to India in 2024\u201325<\/h3>\n<ul>\n<li>Crude oil \u2013 $4.5 billion<\/li>\n<li>Petroleum products \u2013 $3.6 billion<\/li>\n<li>Coal &amp; coke \u2013 $3.4 billion<\/li>\n<li>Cut &amp; polished diamonds \u2013 $2.6 billion<\/li>\n<li>Electric machinery \u2013 $1.4 billion<\/li>\n<li>Aircraft, spacecraft &amp; parts \u2013 $1.3 billion<\/li>\n<li>Gold \u2013 $1.3 billion<\/li>\n<\/ul>\n<h3>Future Outlook: Targeting $500 Billion by 2030<\/h3>\n<ul>\n<li>India and the US are <strong>negotiating a trade agreement<\/strong> aimed at boosting bilateral trade.<\/li>\n<li>The shared goal: <strong>increase total trade to $500 billion<\/strong> by <strong>2030<\/strong>, up from the current <strong>$191 billion<\/strong>.<\/li>\n<\/ul>\n<h2>China Remains India\u2019s Second-Largest Trading Partner<\/h2>\n<ul>\n<li>In 2024\u201325, India\u2013China bilateral trade rose to $127.7 billion, up from $118.4 billion in 2023\u201324.<\/li>\n<li>China continues as India\u2019s second-largest trading partner, after the US.<\/li>\n<\/ul>\n<h3>Trade Deficit with China Widens Sharply<\/h3>\n<ul>\n<li><strong>India\u2019s exports to China<\/strong> fell by <strong>14.5%<\/strong>, dropping to <strong>$14.25 billion<\/strong> (from $16.66 billion).<\/li>\n<li><strong>Imports from China<\/strong> surged by <strong>11.52%<\/strong> to <strong>$113.45 billion<\/strong> (from $101.73 billion).<\/li>\n<li>This caused India\u2019s <strong>trade deficit with China to widen<\/strong> by <strong>17%<\/strong>, reaching <strong>$99.2 billion<\/strong>, up from $85.07 billion in the previous year.<\/li>\n<\/ul>\n<h3>Historical Trade Dynamics<\/h3>\n<ul>\n<li>China was India\u2019s <strong>top trading partner<\/strong> from <strong>2013\u201314 to 2017\u201318<\/strong> and again in <strong>2020\u201321<\/strong>.<\/li>\n<li>Prior to China, the <strong>UAE<\/strong> held the top spot.<\/li>\n<\/ul>\n<h3>Analysis<\/h3>\n<ul>\n<li>Experts noted that India\u2019s growing trade deficit with China reflects structural dependency, not just trade imbalance.<\/li>\n<li>They termed it a &#8220;competitiveness crisis&#8221;, as exports to China have fallen below FY14 levels despite a weaker rupee.<\/li>\n<\/ul>\n<h2>Conclusion<\/h2>\n<p>India\u2019s trade landscape is undergoing a steady transformation, marked by deepening economic ties with the US and persistent trade challenges with China.\u00a0<\/p>\n<p>While the US has emerged as India\u2019s largest trading partner, offering significant export growth and a widening trade surplus, China continues to dominate as a key supplier, leading to a growing trade deficit.\u00a0<\/p>\n<p>As India seeks to bolster its global economic standing, strategic partnerships with nations like the US and UAE are becoming more crucial.\u00a0<\/p>\n<h2>India Trade Deficit FAQs<\/h2>\n<p><strong>Q1.<\/strong> What is India\u2019s trade deficit with China in FY25?<\/p>\n<p><strong>Ans.<\/strong> India\u2019s trade deficit with China reached $99.2 billion in FY25, a 17% increase from the previous year.<\/p>\n<p><strong>Q2.<\/strong> Which country is India\u2019s largest trading partner?<\/p>\n<p><strong>Ans.<\/strong> The US has been India\u2019s largest trading partner for the fourth consecutive year, with $131.84 billion in trade.<\/p>\n<p><strong>Q3.<\/strong> How did India\u2019s exports to the US perform in FY25?<\/p>\n<p><strong>Ans.<\/strong> India\u2019s exports to the US increased by 11.6%, reaching $86.51 billion in FY25.<\/p>\n<p><strong>Q4.<\/strong> What are India\u2019s top exports to the US?<\/p>\n<p><strong>Ans.<\/strong> Top exports include drug formulations, telecom instruments, precious stones, and petroleum products.<\/p>\n<p><strong>Q5.<\/strong> Why is India\u2019s trade deficit with China increasing?<\/p>\n<p><strong>Ans.<\/strong> The trade deficit with China is widening due to a decrease in exports and an increase in imports.<\/p>\n<p><strong>Source: <\/strong><a href=\"https:\/\/indianexpress.com\/article\/business\/india-us-exports-tariff-shipments-reciprocal-duties-9946913\/\" target=\"_blank\" rel=\"nofollow noopener\">IE<\/a> | <a href=\"https:\/\/www.thehindu.com\/news\/national\/us-remains-indias-largest-trading-partner-for-fourth-consecutive-year-in-2024-25-government-data\/article69455572.ece\" target=\"_blank\" rel=\"nofollow noopener\">TH<\/a> | <a href=\"https:\/\/www.business-standard.com\/economy\/news\/economy-india-us-trade-2025-top-partner-deficit-china-125041600483_1.html\" target=\"_blank\" rel=\"nofollow noopener\">BS<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>India&#8217;s trade with the US rises, but growing dependence on Chinese imports widens the trade deficit with China, highlighting a complex trade dynamic.<\/p>\n","protected":false},"author":5,"featured_media":45847,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18],"tags":[],"class_list":{"0":"post-45846","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-mains-current-affairs","8":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/45846","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=45846"}],"version-history":[{"count":0,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/45846\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/45847"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=45846"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=45846"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=45846"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}