India’s exports to China rose to their highest level on record in 2025, showing modest gains in outbound trade to the world’s second largest economy. However, the increase was outweighed by a sharper rise in imports from China, pushing the bilateral trade deficit to a new all time high, according to official trade data.
India’s shipments to China grew by nearly 10% year on year, reaching close to $20 billion. This marked a rare improvement after several years of relatively subdued export growth, reflecting stronger demand for select Indian goods.
Despite this progress, imports from China surged at a faster pace, crossing $135 billion. As a result, India’s trade deficit with China widened to over $116 billion, the largest ever recorded between the two countries.
What India Exported
The rise in exports was driven mainly by:
- Oil meals and agricultural products
- Marine products
- Certain engineering goods
- Limited volumes of telecom and electronic components
While these sectors showed growth, analysts noted that Indian exports remain narrow in range and scale compared to China’s vast export basket.
Why the Deficit Widened
India continues to depend heavily on China for:
- Electronics and mobile phone components
- Machinery and industrial equipment
- Chemicals and pharmaceutical inputs
- Renewable energy components
This structural dependence has kept imports high, even as India has sought to diversify supply chains and promote domestic manufacturing.
Broader Trade Picture
Total India – China bilateral trade reached a record level, highlighting strong commercial ties despite geopolitical tensions and border disputes. Economists said the data underlines the challenge India faces in rebalancing trade without greater market access for high value exports such as pharmaceuticals, IT services and specialty chemicals.
Outlook
Experts caution that while rising exports are a positive sign, closing the trade gap will require sustained policy efforts, including improved market access in China, export diversification, and reduced reliance on Chinese intermediate goods.
For now, the data shows a clear trend: India’s exports to China are growing but not fast enough to offset rising imports, keeping the trade deficit at historic highs.
