In a sign that the Indian government’s efforts to reduce reliance on Chinese imports are succeeding, India’s trade deficit with the East Asian giant has reduced by $10 billion in 2018-19 compared to 2017-18, coming down from $63 billion to $53 billion in the span of a year, reports The Print.
The term trade deficit refers to the gap between the values of exports and imports between two countries.
Commerce and Industry Minister Suresh Prabhu took to Twitter to highlight the good news, stating, “Whopping reduction trade deficit with China. Unprecedented. Exports increased substantially. Result of high level engagement, strategic planning,coordination with stakeholders,market research,sustained efforts,constant monitoring,hand holding with exporters #leadership @narendramodi.”
The rapid reduction in the trade deficit over the previous year is largely due to a massive boost in exports to China, surging by 30 per cent to $17 billion, and a notable contraction in imports, which saw a decline of 9 per cent to $70 billion.
The positive development regarding the trade deficit can be attributed to the Indian government’s efforts to access to domestic markets for locally produced agricultural goods, animal feeds, oil seeds, pharmaceutical goods, etc. Addtionally, more import duties have imposed on Chinese goods.
The trade war between the US and China has also helped, with some Indian exports replacing US goods which have become prohibitively expensive in China.
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