India’s exports to China have recorded a sharp increase this year, with electronics emerging as one of the major contributors despite the continued imbalance in trade between the two countries.
Indian exports to China rose by nearly 40 per cent in the first five months through August, according to an analysis of government data. Electronics and engineering goods were among the biggest contributors, with industry executives pointing to growing demand linked to the global expansion of artificial intelligence and data centres.
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The increase follows a significant rise in exports during the financial year ended March. Shipments to China tripled to $3.18 billion, driven by products including printed circuit board assemblies, smartphones, display modules and telecom equipment. Electronics exports have continued to grow during the current financial year, rising by more than 15 per cent between April and August compared with the same period a year earlier.
Industry representatives said demand for high-end equipment associated with AI-related products and expanding data-centre infrastructure has encouraged Indian electronics suppliers to increase shipments to China.
Rajoo Goel, secretary general of the Electronic Industries Association of India, said the growth was partly linked to suppliers responding to demand for advanced equipment needed for AI-related products and data centres.
The increase in exports provides some support to India’s efforts to expand domestic manufacturing and establish a larger role in global supply chains. It also comes at a time when New Delhi and Beijing are seeking to improve bilateral relations following a prolonged period of strained ties.
However, the growth in exports has so far done little to change the larger trade imbalance between the two countries. China remains a relatively small market for Indian exporters. It accounted for 4.4 per cent of India’s exports in the year ended March, compared with slightly more than 3 per cent a year earlier. By comparison, the United States accounted for almost a fifth of India’s exports.
There are also questions over the exact composition of the recent increase. Chinese customs data does not show a similar rise in printed circuit board imports from India. Instead, much of the increase is reflected under smartphones and other telecommunications products. Industry executives said differences in the way the two countries classify goods could make it difficult to determine precisely which products are driving the increase.
Despite these limitations, Indian exporters remain confident that shipments to China can continue to expand. Growth has also extended beyond electronics. Engineering expo
