At $101.74 b, China remains top import partner of India in FY24

KEY DRIVERS. High-tech and industrial goods account for lion’s share of imports

China retained its spot as top import partner of India in 2023-24 with goods inflows increasing 3.29 per cent (year-on-year) to $101.74 billion, opposed to an overall 5.66 per cent decline in the country’s imports, per government figures.

High-tech items such as telecom and smartphone parts, laptop and PCs, as well as industrial inputs such as plastic, iron and steel and chemicals contributed substantially to the imports.

“The figures across essential and strategic sectors like electronics, pharmaceuticals, and renewable energy highlight the depth of India’s import dependence on China. This situation underscores potential risks of supply chain disruptions and the need for strategic reassessment to diversify sources and enhance domestic production capabilities,” according to the Global Trade Research Initiative (GTRI).

RUSSIA AT NO.2

Total goods imports by India in 2023-24 fell 5.66 per cent to $675.44 billion. Russia vaulted to the second spot amongst India’s top import sources, surpassing the UAE and the US, in 2023-24. India’s import from Russia rose 34 per cent to $61.44 billion during the fiscal comprising mostly oil. The UAE slipped one spot to the third place with imports from the country declining 9.8 per cent to $48.01 billion. The US, too, slid a rank to the fourth spot with imports from the country falling 19.83 per cent to $40.77 billion.

New Delhi, from time to time, has been taking steps to check imports of cheap goods, especially from China, by introducing various quality control measures. Late last year, the Centre introduced mandatory import authorisation system for certain IT hardware goods, including laptops, PCs and tablets. The authorisations are valid till September 30, 2024. The move was largely seen as one to keep a tab on imports from China. There is lack of clarity on what the import policy for the identified hardware items will be post September 30.

RELIANCE ON CHINA

India imported $4.2 billion worth of telecom & smartphone parts during FY24 from China, accounting for 44 per cent of total imports in this category, indicating significant reliance on Chinese components, the GTRI report noted. Laptops and PCs imports from the neighbouring country totalled $3.8 billion, making up 77.7 per cent of India’s imports in this sector, again showcasing a heavy dependency on Chinese technology.

Imports of digital monolithic integrated circuits from China were valued at $3.3 billion, representing 26.2 per cent of total imports in this category while assembled photovoltaic cells imports amounted to $2.9 billion, constituting 65.5 per cent of such imports.

Non-assembled cells imports were valued at $1 billion, accounting for 55.9 per cent of the total, emphasising dependence on Chinese supplies for solar energy expansion, the report further stated.

Other significant imports from China in FY24 include that of lithium-ion batteries ($2.2 billion), agricultural Inputs ($1.3 billion worth of diammonium phosphate), radio transmission and television apparatus parts ($0.8 billion), antibiotics ($0.7 billion), smartphones ($0.9 billion), and computer and phone memory components ($1.1 billion).