China posts trade deficit first time in six years

China, the world fastest growing economy has posted a trade deficit of $7.24 billion in March, first time in six years.

China exported $112.11 billion worth of goods and services in March, up 24.3 per cent year-on-year, while imports surged 66 per cent to $119.35 billion over the year ago period, according to a report released by the General Administration of Customs.

However, during the first three months, the country posted a trade surplus of $14.49 billion. Though it was sharply down by 76.7 per cent over the same period last year. The country's imports and exports totalled $617.85 billion in the first quarter, up 44.1 per cent y-o-y.

Though the trade deficit may be a concern for China, as much of its growth over the past decade was basically export-driven, it may come handy for it to defend its policy and not allow its currency - Yuan - to appreciate as being vociferously demanded by the United States.

Chinese Premier Wen Jiabao has said he would welcome trade deficit at this point of time as any surge in imports from the US and EU could help the economies of those countries and in turn would help generate jobs.

From India's point of view, first two months of this year registered a brisk growth. India-China bilateral trade which posted a dip last year, showed 55 per cent increase in the first two months compared to the previous year.

In the last two months, India's exports touched $3.49 billion against China's $5.49 billion. Trade dipped to $44 billion last year from $52 billion in 2008. India's trade deficit too grew from $11 billion to $16 billion.