New Delhi: In recent months, export of India to China has grown by almost 90 percent which gives good publicity. This appears on the surface to be a large success of Indian trade. Nevertheless, analysts indicate that the reality of the matter is not so simple as it may seem.
Majority of this export expansion was on raw materials like iron ore, chemicals and basic minerals. Chinese factories use these products in the production process. Although it has contributed in terms of the export figures of India, it does not imply that India is exporting more finished goods that are of high value.
Meanwhile, India still imports much more than it exports out of China. Such goods as electronics, machinery, and industrial products continue to be primarily Chinese. This maintains the level of trade gap between the two countries.
According to experts, the true strength of trade is when a country exports manufactured products, goods of technology and branded products. The Indian government is also making effort to enhance manufacturing by pursuing such initiatives as Make in India or Production Linked Incentive schemes.
The export surge is good but it must be regarded as a commencement. It will take a long-term success in terms of enhancing the quality of manufacturing, skills and infrastructure in order to compete with China better.
