India’s Top Trading Partners

28.05.2024

India’s Top Trading Partners

Why in the news?                                                                                                                                                                                                                                     

India has recorded a trade deficit, the difference between imports and exports, with nine of its top 10 trading partners in 2023-24, according to official data.

About India’s Top Trading Partners:

• China has emerged as India's largest trading partner with $118.4 billion of two-way commerce in 2023-24, surpassing the US.
• The bilateral trade between India and the US stood at $118.28 billion in 2023-24. Washington was the top trading partner of New Delhi during 2021-22 and 2022-23.
• In 2023-24, the United Arab Emirates (UAE), with USD 83.6 billion, was the third largest trading partner of India. It was followed by Russia ($65.7 billion), Saudi Arabia ($43.4 billion) and Singapore ($35.6 billion).
• India's total trade deficit in the last fiscal narrowed to $238.3 billion as against $ 264.9 billion in the previous fiscal.
• The trade deficit with China rose to $85 billion, Russia to $57.2 billion, Korea to $14.71 billion, and Hong Kong to $12.2 billion in 2023-24 against $83.2 billion, $43 billion, $14.57 billion, and $8.38 billion, respectively, in 2022-23.
• India has a trade surplus of $ 36.74 billion with the US in 2023-24. America is one of the few countries with which India has a trade surplus.
• After the US, the Netherlands offers a surplus of $17.3 billion on the back of being a hub of India’s petroleum trade with Europe.
• Other countries with which there is a trade surplus are the UK ($4.5 billion), Italy ($ 2.9 billion), France ($902 million), and Belgium ($598 million).
• India has a free trade agreement with four of its top trading partners - Singapore, the UAE, Korea, and Indonesia (as part of the Asian bloc).

What is the trade deficit?

•  Trade deficit or negative balance of trade (BOT) is the gap between exports and imports. When money spent on imports exceeds that spent on exports in a country, a trade deficit occurs.
• It can be calculated for different goods and services and also for international transactions. The opposite of a trade deficit is a trade surplus.

What causes a trade deficit?

              There are multiple factors that can be responsible. One of them is some goods not being produced domestically. In that case, they have to be imported. This leads to an imbalance in their trade. A weak currency can also be a cause as it makes trade expensive.

                                                            Source: The Hindu

Question :- With reference to India’s trade statistics, consider the following statements:

1. China emerged as India's largest trading partner in 2023-24.

2. India's total trade deficit in 2023-24 decreased when compared to the previous fiscal.

3. India has a trade deficit with the United States of America in 2023-24.

How many of the above statements are correct?

A.Only one

B.Only two

C.All three

D.None

Answer B