India’s Exports to China Rise, Cushioning Impact of US Tariffs

China Emerges as a Key Export Destination
India’s exports to China have surged in the current financial year, providing a buffer against the heavy tariffs imposed by the United States under the Trump administration. Between April and October, India’s exports to China increased 24.7% to reach $10.03 billion, with petroleum products, telecom equipment, and marine products leading the growth.

October Shows Exceptional Growth
In October alone, exports to China jumped 42%, helping offset the slowdown in India’s overall exports caused by the 50% tariffs levied by the US. Despite this, India’s total exports during the period grew by a modest 0.63%, highlighting China’s crucial role as a trading partner in uncertain global markets.

Sector-Wise Export Trends

• Petroleum Products: Exported to China more than doubled to $1.48 billion, reflecting strong industrial fuel demand.
• Telecom Equipment: Exports surged from $207.26 million last year to $778.23 million.
• Marine Products: Exports rose to $659.27 million, up from $548.36 million.

Trade Balance and Context
During April–October, India imported $73.99 billion worth of goods from China, resulting in a trade deficit of $64 billion. Despite this, China remained India’s fourth-largest export destination. Analysts describe this period as one of the strongest phases for bilateral trade, especially at a time when global demand remains volatile and many economies are experiencing a contraction in exports.

Impact of US Tariffs
The US tariffs on India’s goods have significantly affected exports. In October, India’s total exports fell 11.8% to $34.38 billion, while a surge in gold imports pushed the country’s trade deficit to a record $41.68 billion.

Conclusion
China’s consistent demand for Indian goods, particularly in petroleum, telecom, and marine sectors, has helped mitigate some of the adverse effects of US tariffs. As global trade dynamics evolve, maintaining strong exports to China could continue to be a vital strategy for India.