China’s latest transgression on the Line of Actual Control in Arunachal Pradesh led to calls Wednesday for snapping trade ties to teach Beijing a “lesson”, but official data show that India’s imports from the country have jumped to a record high over the last 30 months. Leading the demand to suspend trade with China, Delhi Chief Minister Arvind Kejriwal, in a Twitter post, said, “Why don’t we stop our trade with China? Most of the goods imported from China are made in India. China will get a lesson from this and employment will be created in India.” Preparing for UPSC? Use CRACKUPSC20 code here to get an extra 20% discount on Indian Express subscription. Yet data available with the Department of Commerce show that India’s trade with China crossed the $100-billion mark and reached an all-time high of $115.83 billion in 2021-2022 – 34.06 per cent higher than the $86.39 billion in 2020-2021. In percentage terms, the annual increase in trade with China in the last fiscal was the highest since 2010-2011 when an increase of 35.82 per cent was recorded. In the first seven months (April-October) of the current financial year (2022-2023), trade with China reached $69.114 billion. In 2021-2022, China accounted for 11.19 per cent of India’s total trade ($1035 billion) and it was New Delhi’s second biggest trading partner after the United States ($119.48 billion). However, the big difference between the trade with the world’s two largest economies was that with the US, India had a trade surplus of $32.85 billion, while with China it had a trade deficit of $73.31 billion, the highest for any country. In fact, India’s trade deficit with China during 2021-2022 was double the previous year’s level ($44.02 billion) and it was an all-time high. An analysis of the trade data shows that the recent spike in trade with China is due to an unprecedented surge in imports from the neighbouring country in the last two years. Monthly imports from China, which hit a low of $3.32 billion in June 2020 during the Covid lockdown, started rising after easing of restrictions, and rose to $5.58 billion in the following month (July 2020). It has continued rising and scaled a new peak of $10.24 billion in July this year. The figure of average monthly imports from China increased from $5.43 billion in 2020-2021 to $7.88 billion in 2021-2022. In the first seven months (April-October) of 2022-23, the figure reached $8.61 billion. In pre-Covid times of 2019-2020, the average monthly import figure stood at $5.43 billion.
