Trade between India and China has started increasing once again. Especially when AI and data centers are expanding rapidly globally. India’s exposure in AI and data centers has also increased rapidly, due to which India is now increasing the export of electronic products manufactured to China.
According to Bloomberg report, in the five months till August, northern neighbor China IndiaThere has been an increase of about 40% in domestic exports, in which electronics and engineering products have played a special role. This increase reflects the change in China’s trade relations, which have long been dominated by Chinese goods.
Indian exports to China are increasing rapidly
In the financial year ending March, the shipment of Indian electronics products to China increased three times to $ 3.18 billion, in which printed circuit board assembly, smartphones, display modules and telecom products had an important contribution. According to the report, this momentum continued in the current financial year and the shipment of electronics products increased by more than 15% between April and August as compared to last year.
Why is China suddenly buying so much Indian electronic goods?
Raju Goyal, secretary general of the Electronic Industries Association of India, told Bloomberg that one reason for the surge in exports to China is the high demand for high-end equipment required for AI-related products, which is putting pressure on suppliers to meet. Along with this, the number of data centers has also increased rapidly. From India due to demand for high quality products Sugar Companies are increasing exports of electronics.
Improvement in relations between India and China
For India, this sudden growth gives impetus to increasing manufacturing capacity and establishing Indian companies in international supply chains. The shift is in line with efforts by India and Beijing to mend decades of strained relations, as well as a shift in US tariff strategies, offering both Asian powers a reason to deepen trade ties.
Pankaj Mohindroo, president of the Indian Cellular and Electronics Association, told Bloomberg that these figures show that the Indian manufacturing sector is starting to gain credibility in one of the world’s most competitive global value chains.
Arun Kumar Garodiya, MD of Corona Steel Industry Pvt Ltd, told Bloomberg that despite the modest gain relative to total trade, it indicates that China is opening its doors to Indian exports amid broader geopolitical tensions.
Still very little export to China
Despite recent growth, China remains a minor destination for India’s total exports. China’s share in India’s total exports in the year ended March was 4.4%, slightly more than 3% the previous year, while the US remains India’s largest destination with about 20%. This growth has not brought about any significant change in the deep trade imbalance between the two economic powers. India imported goods worth $131.6 billion from China in the fiscal year ending March, which was about 17% of total imports, and also outstripped its sales to China.
Boom in these sectors
Apart from tech-related shipments, exporters are expected to maintain this momentum in other sectors as well. Exports of engineering products to China, including machinery, automotive parts, hand tools and components, grew by nearly 21% from April to August compared with the previous year.
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Source: www.aajtak.in
