India’s exports to China jump 67.35 per cent in December despite record trade deficit

India’s exports to China surged by 67.35 per cent in December, bucking a broader trend of weak outbound shipments, even as the trade deficit widened to a record USD 116.12 billion, according to annual trade data released by Chinese customs on Wednesday.

The data showed that India’s exports to China increased by USD 5.5 billion compared to the previous year. At the same time, total bilateral trade climbed to an all-time high of USD 155.62 billion in 2025.

Indian exports to China, which have struggled to gain traction over the years, rose to USD 19.75 billion between January and December last year, registering a 9.7 per cent increase, amounting to USD 5.5 billion.

Chinese exports to India also rose, increasing 12.8 per cent to USD 135.87 billion during the same period.

Despite trade flows picking up from both sides, the imbalance widened further. The trade deficit — a persistent issue in India-China trade — touched a record USD 116.12 billion in 2025, crossing the USD 100 billion mark for the second time since 2023.

In 2024, the trade deficit stood at USD 99.21 billion, with China’s exports to India at USD 113.45 billion, while India’s exports to China stagnated at USD 14.25 billion.

The Chinese data covers trade from January to December, while India releases its annual trade figures from March to April.

Observers said the USD 5.5 billion rise in Indian exports, though modest in absolute terms, was significant. They pointed to increased shipments of oil meals, marine products, telecom instruments and spices making inroads into the Chinese market, which is facing challenges in expanding domestic consumption.

India has long been urging China to open up its markets further to Indian information technology services, pharmaceuticals and agricultural products, sectors where India has a competitive edge.

China’s overall global trade continued to expand despite trade tensions with the United States. Customs data showed China’s trade surplus surged to a record of nearly USD 1.2 trillion in 2025, an increase of 20 per cent compared to 2024. Exports stood at USD 3.77 trillion, while imports totalled USD 2.58 trillion.

The growth in China’s exports despite tariff hikes imposed by US President Donald Trump was attributed to Beijing’s diversification strategy.

Wang Jun, vice-minister of the General Administration of Customs, said China’s export performance remained strong last year despite global trade headwinds.

“Our trading partners are increasingly diversified, and our risk-resilience has significantly strengthened,” he told the Hong Kong-based South China Morning Post.

Gary Ng, senior Asia-Pacific economist at French investment bank Natixis, said trade tensions remained and external demand may weaken this year.

“I think Chinese exports will continue to grow in 2026, but at a slightly slower pace,” Ng told the newspaper.

(With inputs from agencies)