China's Non-Tariff Barriers Biggest Hurdle For Trade Ties: Sitharaman
· Free Press Journal
Finance Minister Nirmala Sitharaman has expressed concern over India's widening trade deficit with China, accusing Beijing of imposing non-tariff barriers that restrict access for Indian exporters.
Speaking with the Atlantic Council on the sidelines of an International Monetary Fund (IMF) meeting in Bangkok on Friday, Sitharaman said the trade imbalance was expanding rapidly.
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“With China, I think our trade balance is against us, and it is growing exponentially,” Sitharaman said. “China uses non-tariff barriers unhesitatingly,” and that is “the biggest hurdle in the trade between India and China.”
India's trade deficit with China has reportedly crossed $100 billion this year, highlighting persistent concerns over bilateral trade.
India Faces Unequal Market Conditions In China: S JaishankarNeed For Fairer Market Access
Sitharaman identified non-tariff restrictions as a major obstacle to Indian exports entering the Chinese market.
She specifically cited phytosanitary regulations, which are intended to prevent the spread of plant pests and diseases.
According to the Finance Minister, Indian products such as generic medicines, beef and vegetables have significant market potential in China but face restrictions.
She maintained that India had not responded by introducing similar barriers or countervailing duties against Chinese products.
Her comments followed External Affairs Minister S Jaishankar's observation earlier this week that Indian businesses lacked a level playing field in China.
Bilateral relations deteriorated following the deadly border confrontation in 2020, resulting in restrictions on investments and business engagement.
However, New Delhi and Beijing have gradually resumed diplomatic engagement, with Prime Minister Narendra Modi and Chinese President Xi Jinping seeking to stabilise relations.
Seeks ASEAN Trade Review
Sitharaman also criticised India's existing trade arrangements with the Association of Southeast Asian Nations (ASEAN), describing their terms as unfavourable.
She said India intended to maintain the agreement but wanted its provisions revised to address trade imbalances.
Beyond regional trade, the Finance Minister highlighted India's dependence on imported crude oil and fertilisers.
She warned that rising expenditure on these essential commodities was increasing foreign exchange outflows.
Higher oil prices, foreign capital withdrawals and elevated US bond yields have also contributed to pressure on the rupee.
The Reserve Bank of India (RBI) has reportedly intervened through dollar sales and measures addressing foreign exchange requirements.
These include a special facility for state-owned oil companies and tighter currency derivatives regulations.
Although the rupee has recovered from near-record lows, the underlying pressures remain.
Sitharaman's remarks highlight India's efforts to improve market access while managing import dependence and currency volatility.