Finance Minister Nirmala Sitharaman has expressed concern over the loss India is incurring in trade with China. He said that China is not giving adequate access to Indian products in its market. Non-tariff restrictions imposed by China are the biggest obstacle to increasing trade between the two countries. According to Sitharaman, India’s trade deficit with China has been steadily increasing and has crossed $100 billion so far this year.

Nirmala Sitharaman said this while speaking to the Atlantic Council during the International Monetary Fund (IMF) meeting in Bangkok on Friday. He said that China imposes many conditions, which make it difficult for Indian companies to sell their products there. He exemplified the rules made to protect plants and crops from diseases and pests. According to Sitharaman, exports of Indian products are affected due to these regulations. China has good potential for products like generic drugs, meat and vegetables, but Indian exporters are not getting enough opportunities there. He also said that India has not taken the route of imposing non-tariff restrictions or additional tariffs on Chinese goods.

Relationships are improving, but business is not

External Affairs Minister S Jaishankar also said this week that India is not getting equal opportunities for business in China. Concerns over trade between the two countries have come to light at a time when efforts are underway to mend strained relations following a violent border clash in 2020. Prime Minister Narendra Modi and Chinese President Xi Jinping are also making efforts to stabilize relations between the two countries. However, despite improvements in diplomatic negotiations, trade-related problems persist.

India wants changes in trade agreement with ASEAN

Sitharaman also raised concerns about India’s trade agreements with the Association of South-East Asian Nations (ASEAN). According to him the terms of the existing agreements are not balanced in favor of India. India wants to continue the agreement, but changes in its terms are necessary to eliminate trade imbalances.

Dependence on crude oil and fertilizers is also a concern

The Finance Minister said that India’s dependence on crude oil and fertilizer imports is a major challenge for the economy. A large amount of money is constantly spent on importing these essential commodities, which affects the country’s foreign exchange reserves. High crude oil, capital withdrawals by foreign investors and rising bond yields in the US are also under pressure on the rupee. In such a situation, the Reserve Bank of India is trying to control the rupee by selling dollars and taking other measures. However, pressure on the rupee remains due to import requirements and international economic conditions.