India-China bilateral trade hits $10.7 billion in October, contracts 0.46%

Out of India's top 10 import partners, inbound shipments from the United Arab Emirates (UAE) grew at the fastest pace in October

India’s bilateral trade with China stood at $10.7 billion during October, witnessing 0.46 per cent contraction amid a slowdown in the neighbouring country, commerce department data showed.

 

The contraction was mainly driven by exports as outbound shipments to China contracted 9.5 per cent at $1.15 billion, even as India’s overall exports bounced back in October and saw a double-digit growth of 17 per cent.

 

In fact, barring China, exports to nine out of India’s top 10 export destinations witnessed a positive growth during October. Countries that saw positive exports growth are: the US (11.5 per cent), the UAE (43.3 per cent), the Netherlands (14.6 per cent), the UK (42.1 per cent), Singapore (197 per cent), Saudi Arabia (0.5 per cent), Bangladesh (2.5 per cent), Germany (25.7 per cent), and Australia (60.4 per cent).

 

While the disaggregated data for the month wasn’t immediately available, trends over the last few months show that exports to China — India’s second-largest trade partner and largest source of imports — have been slowing mainly due to lower demand for items such as iron ore, among other items, indicating a broader slowdown in the country.

 

Exports to China have been contracting over the last few months. In June, China became India’s fifth-largest export market. In October, it became the sixth-largest export destination, down by a notch from September. Imports growth from China was also tepid (0.74 per cent) at $9.6 billion in October. However, the country remained India’s largest source for imports.

 

Out of India’s top 10 import partners, Indonesia, South Korea, Singapore, and Switzerland witnessed a contraction of 2.9 per cent, 16.7 per cent, 5.6 per cent, and 66 per cent, respectively. Inbound shipments from other countries such as China, Russia, the UAE, the US, Iraq, and Saudi Arabia grew during October. Inbound shipments from the UAE grew at the fastest pace during the month.

 

Imports from the UAE witnessed 70.4 per cent growth year-on-year (Y-o-Y) at $7.18 billion, even as India’s imports from all over the world saw 3.8 per cent growth at $66 billion during October. The UAE was India’s third-largest trade and import partner during October. China and Russia remained India’s top import sources.