India’s trade deficit with China crosses $100 billion in 2026
India's trade deficit with China has surpassed $100 billion for the current year, driven by a significant rise in imports despite a 40% growth in Indian exports. Both nations are grappling with structural trade imbalances and supply chain dependencies in sectors like electronics and machinery.
Why it matters
The widening trade gap is a critical economic and geopolitical issue affecting India's manufacturing ambitions and diplomatic relations with China.
India’s exports to China grew 40% in the first three quarters to $20 billion, although the trade deficit with China has continued to widen, already crossing $100 billion this year, according to data released Wednesday by China’s General Administration of Customs (GAC).
Two-way trade between January and September was up 25.4% to $144.45 billion, while India’s imports from China continued to rise, up 23.3% to $125.19 billion. Indian exports to China registered a robust 40.7% growth, albeit from a much smaller base, to $19.26 billion after the first three quarters, already reaching last year’s total.
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