Trade imbalance

India's aspiration to achieve self-reliance and reduce dependence on imports in critical sectors such as electronics, electric vehicles, semiconductors, and machine tools continues to encounter significant obstacles.

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The latest trade figures for July reveal that despite the resistance against Chinese products, China remains dominant in India's imports, accounting for about 18 per cent of total imports for the month. Further, imports from other emerging economies are also rising. For instance, Vietnam's share in India's imports increased 26 per cent in July 2024 compared to the same period last year, which was possibly driven by Chinese firms rerouting exports through other economies. The trade deficit with China stood at $85 billion in 2023-24.