India’s exports to China rose – cloud’s silver-lining

India's exports to China rose

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India’s exports to China rose and are return stream to economies that are getting success in curbing the COVID-19 spread.

Enriching exports amidst pandemic

  • India stated to boycott China on multiple façades after the Galwan Valley during confrontation among soldiers, while the dragon is purchasing Indian products at full swing. India’s exports to China rose 78% in June 2020 year after year, a Crisil report casts light on it.
  • In addition to Chinese market, the exports have also risen to other Eastern Asian economies, which put into effect almost 16% of the Indian export trade.
  • Exports from India changed from a decline of 60.2% on-year in April to a downturn of 10.2% in July. The rationale for this is a steep increase in exports to economies that managed to curb the coronavirus disease outbreak. The Covid-19 had flattened the curve for economies during this time span, “Crisil added.
  • Feeble domestic demand and surging prohibitions also depicts that India’s imports have been dimmed, significantly reducing China’s trade deficit, the report claims. India’s trade deficit with China has massively increased to $1.2 billion in June, from $2.4 billion in May, as per official figures.
  • India’s growth in exports in a pandemic-dominated world tends to be inversely related to the spike in Covid-19 instances in its export destinations, said Crisil, further emphasizing that exports to countries such as China, Malaysia, Singapore, Vietnam, South Korea and Japan are increasing and on the other side exports to the UAE, the UK, Germany, the US and Brazil are shrinking.
  • It pointed out that China has handled the pandemic much earlier than other economies as the cases increased in February, after which economic activity refurbished to some extent. While most economies are dropping into recession, during the April-June quarter China’s GDP grows 3.2% on-year.
  • At the same time, the driving factors behind the growth of India’s exports to China were industrial commodities like iron and steel, ores and organic chemicals. Albeit, India’s imports from China have plummeted, due to anemicer domestic demand and import restrictions.
  • “Trade opportunities for this fiscal cycle must shift through countries on the pandemic route. It will lead to countries that have regulated their caseload and resumed their operations, “explains the study.
  • Since March 2020, India’s exports have dropped dramatically, but revived in June and July, shrinking just around 10-12 percent in those 2 months. Rating agency Crisil said in its study that India’s exports to China rose along with and Malaysia by more than 70% in June, even as those to the US and the UK contracted in the same period.
  • The trade deficit with China has consequently declined evidencing the overall ephemeral positive outlook for the Indian economy. The market fundamentals for trading with Chinese economy have went into watching and monitoring drive with the future prospects being on the roller coaster ride.


The rise in exports to China could be stated as providential for the markets at large and the economists in particular during the pandemic times but considering the on-going territorial tiffs, the long term prospects seem despondent and subjective.

Read this article also: Chinese Exports to India Dropped – Trade Impacts

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