China tops India's trade

China replaced the United States as India’s biggest trading partner in the fiscal year that ended in March, driven by a fresh surge in imports from Chinese factories. (economictimes.indiatimes.com) Two-way trade between India and China reached $151.1 billion in fiscal 2025-26, according to government data reported on April 15. India imported $131.63 billion from China and exported $19.47 billion, leaving a goods trade gap of $112.16 billion. (economictimes.indiatimes.com) The United States had held the top spot for four straight years through fiscal 2024-25. In fiscal 2025-26, India’s goods trade with the United States totaled about $140.2 billion, with exports of $87.3 billion and imports of $52.9 billion. (moneycontrol.com) The shift shows how India’s supply chains still run through China even as New Delhi tries to build more manufacturing at home. Recent reporting tied that dependence to electronics, machinery and active pharmaceutical ingredients, the chemical inputs used to make medicines. (tribuneindia.com (ndtvprofit.com) That reliance has persisted after years of political strain. India tightened scrutiny of Chinese investment under Press Note 3 in April 2020 after the Galwan Valley clash, requiring government approval for investment from countries that share a land border with India. (indiasworld.in) The border picture has eased somewhat since late 2024. India’s foreign ministry said an October 21, 2024 agreement restored patrolling and grazing in parts of eastern Ladakh, and Prime Minister Narendra Modi and President Xi Jinping met in Kazan two days later. (mea.gov.in 1) (mea.gov.in 2) New Delhi has also started to loosen some economic restrictions. Reuters reported on March 10 that India approved limited easing of Chinese investment curbs in select sectors to relieve a capital squeeze and support manufacturing. (finance.yahoo.com) The trade numbers still point in one direction: India sells far less to China than it buys, even as exports to China jumped 36.66% in fiscal 2025-26. For now, China’s return to the top of India’s trade table says more about industrial dependence than diplomatic warmth. (economictimes.indiatimes.com)