Business & Finance

Relationship with China strain- Finance and Commerce ministers join force to fight trade deficit

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Chinese imports have had a big impact on domestic economy as with Chinese imports, there has been a decline in India’s economic growth. To meet the ends, fighting trade deficit, the finance and the commerce departments have joined forces to form a committee to resolve the issues. The committee comprising of senior officials plan to pave ways to decrease imports from China. Along with it, the team plans to send a two-person delegation to China to agree upon trade conditions.

With ever growing trade deficit, the trade deficit with China is a staggering 62.94 billion dollars in the financial year 2016-17. Only 13 billion dollars’ worth exports to China had been conducted in the same fiscal year. Serious cautions had been issued to China at the World Trade Organisation summit at New Delhi to lower the trade taxes at Beijing on items like rice, IT products, meat and pharmaceuticals so that equal exports may be carried out from India hence lowering the trade deficit.

Messages were made clear to China to provide transparency in accordance to licensing, trade taxes and qualification standards of agricultural exports and IT sector services from India. China is preparing to give approval to Indian pharmaceuticals in Beijing as an effort to get ahead of what seems to be a possible trade war with the United States.

Indian firms are planning to replace Chinese goods like sugar in the domestic markets in an attempt to reduce its imports. The only way to know whether this committee will work or not is to put it to test.

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