India to diversify its trade basket with China

India to diversify its trade basket with China

Concerned over the growing bilateral trade imbalances, India, on Friday, decided to promote export of Indian handmade carpets to China to further diversify the trade basket between the two countries and also satiate China’s growing demand for handicraft.

In his meeting with the Governor of Qinghai Province of China Luo Huining here, Commerce & Industry Minister Anand Sharma stressed the need to increase the quantum of export of handmade carpets to the neighbouring country.

Sharma said, of the total export of handmade carpets amounting to $653.86 million only $4.83 million were exported to China which is way below the potential that the two big and growing economies have.

Duty-free showcase

The minister suggested that the exhibitors from India showcasing their products in exhibitions in China be allowed duty-free with a restricted value.

He also raised issue of the need for lower duty on the import of Indian handmade carpets.

“High Duty on these carpets make them expensive for the rising consumer class of your country and does not help the local industry very much,” Sharma said.

Both India and China are on the course to achieve the bilateral trade target of $100 billion by 2015, but the trade is highlytilted in China’s favour.

According to the Directorate General of Commercial Intelligence and Statistics, the total trade volume had gone up from $2.3 billion in 2000-01 to $59.62 billion in 2010-11.
However, the trade deficit for the Indian side had increased from $9.1 billion in 2006-07 to $20.8 billion in 2010-11.

Analysts suggest both sides need to work aggressively towards removing administrative bottlenecks and overly restrictive regulatory measures to boost bilateral commerce.