Full Breakdown
India and China Resume Trade Talks to Tackle Imbalance and Supply-Chain Issues
By Drooid · · How we work
Renewed Engagement
On September 12, Commerce and Industry Minister Piyush Goyal met his Chinese counterpart Wang Wentao, marking the first high-level dialogue after a prolonged gap. Three days later, Commerce Secretary Rajesh Agrawal announced that bilateral discussions had formally begun and that further meetings are scheduled to continue the engagement.
Trade Figures and Imbalance
Data released by the Commerce Ministry indicate that total bilateral trade rose 7.9 % to USD 127.7 billion in fiscal 2025-26, up from USD 118.39 billion in 2024-25. India’s exports to China increased 36.62 % to USD 19.47 billion, while imports grew 16 % to USD 131.62 billion, widening the trade deficit to USD 99.19 billion (previously USD 85 billion).
Investment and Policy Context
India has tightened its foreign-direct-investment (FDI) policy for countries sharing a land border. The ministry reports that India received USD 2.51 billion in FDI from China between April 2000 and March 2026. In the April-August window of fiscal 2026-27, exports to China rose to USD 9.61 billion from USD 6.93 billion a year earlier, while imports increased to USD 65.49 billion from USD 51.56 billion. Key export sectors showing growth include engineering goods, electronics, petroleum products, chemicals and iron ore.
Official Statements & Responses
Secretary Agrawal emphasized that both sides need to present their concerns and positions on structural trade imbalances and supply-chain challenges, describing the talks as a “work in progress” with “very positive” engagement. He noted recent improvements in people-to-people contact and direct air connectivity, and reiterated India’s openness to finding mutually acceptable solutions.
Verbatim Quotes
- “I think there will be meetings subsequently also to take these discussions forward. These discussions are happening after a long gap,” — Rajesh Agrawal, to commerce secretary
- “Both sides should work together to address each other’s concern in the trade space…also look at the structural trade imbalance, supply chain issues, and how to build trust in the trade between the two sides…I think both sides are engaged to understand each other’s position on many of these issues,” — Rajesh Agrawal, to commerce secretary
- “So this is a work in progress. On trade, we have started engaging. Both sides are engaging very positively,” — Rajesh Agrawal, to commerce secretary