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India Flags China Trade Deficit as Bilateral Ties Stabilise
India and China have been trying to improve their relationship.
Their leaders and senior officials held several meetings during 2025 and early 2026.
However, India buys much more from China than it sells there.
This difference is called a trade deficit.
The deficit was $75.05 billion, while total trade reached $96.46 billion up to November.
Both leaders said they wanted to increase trade and reduce the deficit.
The countries also restarted direct flights and the Kailash Mansarovar pilgrimage.
India’s foreign ministry expanded its offices and divisions during the same period.
India’s Ministry of External Affairs reported bilateral trade with China of $96.46 billion up to November.
The report said India’s $75.05 billion trade deficit with China remains a concern acknowledged by both leaders.
India and China intensified high-level exchanges in 2025 and early 2026 after ties deteriorated following the 2020 Eastern Ladakh clashes.
Confidence-building measures included resuming direct flights and the Kailash Mansarovar pilgrimage.
The Ministry of External Affairs also created four territorial divisions and opened an embassy in Quito plus seven consulates.
- Who
- India’s Ministry of External Affairs, Prime Minister Narendra Modi, Chinese President Xi Jinping, and senior officials from both countries.
- What
- India reported stabilising India-China ties while highlighting a $75.05 billion trade deficit and increased diplomatic engagement.
- Where
- India and China, including meetings in New Delhi, Beijing, Tianjin, and other locations.
- When
- The report covers developments in 2025 and the early months of 2026; the trade figures cited run up to November.
- Why
- The countries are seeking to stabilise relations after the 2020 Eastern Ladakh clashes while expanding trade and reducing India’s deficit.
Key facts
- Total bilateral trade
- $96.46 billion up to November
- India-China trade deficit
- $75.05 billion
- Main import pressure
- Large imports of electronic goods by Indian manufacturers
- Diplomatic engagement
- High-level exchanges intensified in 2025 and early 2026
- Confidence-building measures
- Direct flights and the Kailash Mansarovar pilgrimage resumed
- New territorial divisions
- Central America, South America, Northern Europe, and Southern Europe
- New diplomatic posts
- An embassy in Quito and seven consulates were opened
Quotes
Narendra Modi and Xi Jinping
The prime ministers of India and China, as quoted in the MEA report
“Total bilateral trade stood at USD 96.46 billion up to November, though a trade deficit of USD 75.05 billion remained a concern that both leaders acknowledged needed to be addressed”
theprint.in
“need to proceed from a political and strategic direction to expand bilateral trade and investment ties and reduce trade deficit”
theprint.in
Sources
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