Strategy Paper of Ministry of Commerce to bridge Trade Deficit with China
The Strategy Paper of the Ministry of Commerce has outlined measures to bridge the trade deficit with China.
India’s Trade Deficit with China
Over the last decade, India’s trade deficit with China had increased rapidly. But the deficit narrowed in fiscal 2019 since exports to China increased by 25.6 per cent and the imports declined by 7.9 per cent.
Strategy Paper of Ministry of Commerce
Measures outlined in the strategy paper are:
- Export incentives to push export to China.
- Pursuing greater market access for agriculture, dairy products, and pharmaceuticals.
- Indian pharmaceutical firms are facing regulatory hurdles such as prolonged and unpredictable timelines for drug registration, demand for submission of detailed clinical trial data and requirement for revealing the drug formulation process at the time of filing for registration.
- Establishing an interface between Food and Drug Administration’s (FDA’s) of India and China for the conduction of regular training programmer on regulatory standards and processes of filling dossiers in China; and relaxing product registration time from 3-5 years to one year to boost pharma exports.
- Pursuing export orders where market access has been obtained from China for commodities like rice, sugar and sesame seed.
- India’s imports from China are dominated by electronics, telecom, electrical equipment and pharmaceuticals. The industry suggests steps like focusing on local manufacturing of products like a printed circuit board and camera modules; and creation of the research and development fund for the sector for Import substitution.
- Attracting foreign technology-intensive firms which are relocating their manufacturing facilities away from China in light of the ongoing trade war between the US and China.
The strategy paper was submitted to the Minister of Commerce and Industries Suresh Prabhu.