Despite the recent border tensions between the two countries, India and China continue to be major trading partnersChina was India’s second-largest trading partner as of 2019, only behind the USA

The country accounts for nearly 13.7% of the total imports into India as of 2019

  • Although India’s imports from China declined by 27.63% during April to August 2020, the South Asian nation is still quite dependent on its Eastern neighbour
  • India imports a wide range of products from China, including machinery, chemicals, plastic, and fertilisers

This blog analyses the key items that India imports from China

The Items that India Imports from China

India imports several products from China. Almost all of these products are of vital importance to Indian households

⦁ The topmost item that India imports from China in terms of value is electrical machinery

⦁ According to estimates, India imported machinery worth ₹144,405 crores from China during 2018-19

⦁ Such machinery is used in Indian manufacturing units and packaging facilities

Electrical machinery sourced from China is an important driver of the Indian economy

The second most imported item from China to India is nuclear machinery

  • It is estimated that India imported nuclear machinery worth ₹93,616 crores from China during fiscal 2018-19
  • Such machinery is also widely used by Indian companies, including both urban and rural production units
  • Next on the list is organic chemicals. These chemicals help Indian businesses operating in industries such as medical, pharmaceutical, biochemical, or bioengineering
    • During 2018-19, India imported Chinese organic chemicals worth ₹60,082 crore
  • In addition to the above, India also imports plastic items from China. These items play an important role in Indian industries as well as households. Chinese plastic toys continue to be extremely popular in India. Similarly, plastic products are also widely used in areas such as plumbing
    • During fiscal 2018-19, India imported Chinese plastic products worth ₹19,038 crore
    • This figure has jumped significantly compared to the previous fiscal, thereby indicating the huge demand for Chinese plastic products in India
  • The fifth most imported Chinese product in India is Fertilizers. This product is extremely important for the Indian agriculture industry
    • Despite India’s recent economic growth, the country continues to rely on its agriculture sector to a great extent
    • According to estimates, India imported fertilisers worth ₹14,412 crores from China during 2018-2019
    • It is important to note that this figure has more than doubled compared to 2017-18, thereby indicating the rapid increase in demand from India

There are several other products that India imports from China. These products include iron and steel items, vehicles, speciality chemicals, as well as pharmaceutical drugs

Thus, it is evident that India continues to import several categories of products from China. The three Indian industries that are most dependent on Chinese imports include manufacturing, agriculture, and pharmaceuticals. In case there are any major trade disruptions over the next few months, then these industries are likely to face major issues

To conclude, it is clear that India imports several goods and services from China. In order to facilitate the process, institutions such as Euro Exim Bank offer customised support to importers in the form of financial instruments and bespoke trade advisory services. Euro Exim Bank offers financial instruments such as Bank Guarantees and Letters of Credit (LCs). Further information about Euro Exim Bank and its key product offerings is available here.