Indian exports to China rise in 2025 but trade deficit touches record high of USD 116 bn

Beijing, Jan 14 (PTI) India's exports to China posted a USD 5.5 billion increase compared to last year bucking the declining trend even as the trade deficit hit a record USD 116.12 billion, as per the annual trade data released by Chinese customs here on Wednesday.

Bilateral trade, too, surged to an all time high to USD 155.62 billion in 2025, according to the data.

Indian exports to China which over the years struggled to make headway climbed to USD 19.75 billion between January and December last year, posting a 9.7 per cent increase, amounting to USD 5.5 billion, according to the data.

At the same time, Chinese exports to India increased 12.8 per cent to USD 135.87 billion last year.

While trade is picking up from both countries, the total bilateral trade surged to a record high of USD 155.62 billion in 2025, the year in which both countries faced US President Donald Trump's tariff hikes.

The trade deficit -- a constant problem in India-China trade -- touched a record high of USD 116.12 billion, crossing the USD 100-billion for the second time since 2023.

In 2024, the trade deficit was USD 99.21 billion with China's exports totalling to USD 113.45 billion, and India's outbound shipments to China stagnating at USD 14.25 billion.

China's annual trade data covers from January to December while India releases its figures from March to April.

Observers said the USD 5.5 billion increase in Indian exports, though modest, is significant, pointing to a structural shift with items such as oil meals, marine products, telecom instruments and spices, making headway into the tough Chinese market, which is struggling to expand its domestic consumption.

Also, India over the years has been demanding China to open its IT, pharma, and agricultural produce, which are India's strong areas.

China's overall global trade continues to grow, defying trade tensions with the US.

Customs data showed that the surplus surged to a record of almost USD 1.2 trillion in 2025 an increase of 20 per cent compared to 2024, with exports at USD 3.77 trillion and imports at USD 2.58 trillion.

The growth in China's exports despite Trump tariff hike was attributed to Beijing's diversification strategy.

Wang Jun, vice-minister of the General Administration of Customs, attributed China's robust export performance last year -- in the face of trade headwinds -- to supportive policies and the country's industrial depth.

"Our trading partners are increasingly diversified, and our risk-resilience has significantly strengthened," he told Hong Kong-based South China Morning Post.

Gary Ng, senior Asia-Pacific economist at French investment bank Natixis, noted that trade tensions remained, and external demand might not be as strong this year as in 2025, as most central banks no longer have much room for further rate cuts.

"I think Chinese exports will continue to grow in 2026, but at a slightly slower pace," Ng told the newspaper. PTI KJV TRB TRB