As trade tensions rise between the United States and China, Beijing is signaling an eagerness to strengthen economic ties with India. In an exclusive interview with The Times of India, China’s Ambassador to India, Xu Feihong, emphasized that China is ready to welcome more premium exports from India, offering support to Indian businesses seeking to enter its expansive consumer market.
Strengthening India-China Trade Ties Amid US Tensions
Xu Feihong, in his interview, stressed that the essence of China-India trade relations lies in mutual benefit and win-win cooperation. He explained that China has never intentionally pursued a trade surplus. Instead, trade surpluses are the result of market-driven efficiencies that change in response to evolving economic conditions.
“Trade surpluses reflect the efficiency of the market. These trends evolve with changing economic conditions,” Feihong said, outlining China’s broader strategy in international trade.
Investment Potential in China’s Consumer Market
The Chinese ambassador also pointed to China’s vast consumer market as a major opportunity for Indian exporters. Quoting President Xi Jinping’s recent address to global business leaders, Feihong highlighted China as the world’s second-largest consumer market, with the largest middle-income group. This, he noted, creates significant opportunities for Indian businesses seeking to expand.
“Valuing China’s super-sized market will unlock greater commercial opportunities for Indian companies,” Feihong said. He added that China’s commitment to opening its market further could pave the way for deeper economic collaboration.
Growth in Indian Exports to China
Trade statistics from fiscal year 2024 show promising growth in Indian exports to China. Key products such as chili peppers, iron ore, and cotton yarn saw impressive increases, with exports rising by over 17%, 160%, and 240%, respectively.
“We welcome more premium Indian goods exports to China. We stand ready to assist Indian businesses in tapping into China’s market demand and exploring further opportunities for economic and trade collaboration,” Feihong stated.
Calls for Better Market Access
While encouraging stronger trade ties, Feihong also urged India to address China’s concerns regarding market access. He emphasized the need for a fair, transparent, and non-discriminatory business environment for Chinese enterprises operating in India.
“We hope that India will take China’s concerns in the economic and trade field seriously. Providing a transparent and fair business environment will help elevate China-India bilateral economic and trade cooperation,” Feihong said. He also noted that strengthening these ties would provide tangible benefits to both countries’ populations.
Trade Deficit and Ongoing Political Tensions
Despite these positive remarks, the economic relationship between India and China continues to be complicated by India’s $99.2 billion trade deficit with China. Furthermore, political tensions stemming from the 2020 border standoff between the two countries continue to affect the diplomatic landscape.
However, China’s recent outreach to India signals a shift in its economic strategy. As the United States maintains its trade policies, including tariffs, China appears to be looking to diversify its trade partnerships. This renewed focus on India could be part of a broader plan to reduce reliance on increasingly adversarial Western markets.
The Chinese ambassador’s comments highlight the potential for increased economic cooperation between India and China, especially as both countries navigate shifting global trade dynamics. While challenges remain, particularly around the trade deficit and political tensions, there are clear opportunities for growth in bilateral trade, particularly in premium Indian exports.
