India's higher textile import from China adding to trade deficit

In the financial year 2021-22, India’s trade deficit with China was recorded at $72.9 billion, up nearly $29 billion from FY21’s figure of $44 billion, according to data from the ministry of commerce.

In May 2022, India exported goods worth $1.6 billion to China, over 25 per cent lower than the $2.1 billion in May 2021. On the other hand, India’s imports recorded a growth of 5.47 per cent in May 2022 compared to the same month last year.

Likewise, for the April and May combined, India’s exports to China fell nearly 31 per cent from $4.4 billion in the same months of 2021 to $3 billion in 2022. On the other hand, imports grew 12.75 per cent in 2022 compared to 2021.

For the second straight year, India and China may cross a total trade figure of $100 billion. In 2021-22, the total trade volume between the two neighbours stood at $115 billion, according to the figures from India’s ministry of commerce and China’s General Administration of Customs.

A similar trend can be seen in India’s apparel and home textiles trade with China.

India’s apparel imports from China registered continuous increase since February 2022 and reached at $87.901 million in May 2022, according to Fibre2Fashion’s market insight tool TexPro. On annual basis, the import was 1145.475 million in 2021, 838.195 in 2020 and 1026.676 million in 2019. It shows apparel import dipped during COVID-19 and military confrontation in 2020. But it jumped in the following year. The import stood at 349.103 million in first five months of 2022.

India’s home textile imports from China stood at $36.109 million in May 2022, up from $24.756 million of April. The import was $20.047 million in March 2022, $16.675 million in February 2022, and $36.742 million in January 2022. The import of home textiles from China was $356.734 million in 2021, $327.791 million in 2020 and $485.444 million in 2019. The import stood at $134.331 million in January-May 2022, as per TexPro.

However, India’s export of apparel and home textiles was very meagre compared to import. Apparel export was $7.673 million in May 2022 which was declining since March 2022 when the export was $13.387 million. Annually, the export was $104.553 million in 2021, $94.398 million in 2020 and $151.246 million in 2019. India has exported apparel worth $50.774 million in first five months of this year.

India’s home textile export to China stood at $3.191 million in May 2022, up from $2.958 million of April but down from March 2022’s figure of $4.364 million. Home textiles export to China was $48.884 million in 2021, $65.345 million in 2020 and $44.351 million in 2019. The export was $17.234 million in January-May 2022.

ALCHEMPro News Desk (KUL)