Despite Tensions, China Back as India’s Top Trade Partner in 2020

India’s reliance on imported machines outweighed measures to curb trade activities with China over border tensions.

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Despite Tensions, China Back as India’s Top Trade Partner in 2020
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China is back as India's top trade partner in 2020, despite continued border tensions between the two countries. Experts are of the view that China could regain its position because India's heavy reliance on imported machines outweighed its efforts to curb commerce with Beijing following the Galwan clashes.



  • According to provisional data from India's commerce ministry, the two-way trade between India and China stood at $77.7 billion last year, which is lower than previous year's $85.5 billion but enough for China to displace US as India's largest commercial partner, reported Bloomberg.
  • Following the Galwan clash, PM Narendra Modi had banned several Chinese apps, slowed down approvals for investments from China and urged India to become self-reliant.
  • However, India continued to depend on Chinese-made heavy machinery, telecom equipment and home appliances.
  • Total imports from China at $58.7 billion were more than India’s combined purchases from the US and the UAE which are its second- and third-largest trade partners, respectively.
  • Almost 51% of India's purchases from China were heavy machinery.
  • India also managed to increase its exports to China by about 11% from a year ago to $19 billion last year, which means if the relation between the two countries worsens, it could also mean a threat to India's exports.

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