New Delhi- India’s trade deficit with China is expected to widen to USD 106 billion in 2025 as imports continue to rise much faster than exports to the neighbouring country, according to a report released on Friday by the Global Trade Research Initiative (GTRI).

India’s exports to China fell from USD 23 billion in 2021 to USD 15.2 billion in 2022, remained subdued at USD 14.5 billion in 2023, and edged up slightly to USD 15.1 billion in 2024. In 2025, exports are projected to improve to USD 17.5 billion, still well below earlier levels, the think tank said.

In contrast, imports from China have grown sharply, rising from USD 87.7 billion in 2021 to USD 102.6 billion in 2022, before moderating to USD 91.8 billion in 2023 and then jumping to USD 109.6 billion in 2024. Imports are estimated to reach USD 123.5 billion in 2025.

“This has pushed India’s trade deficit with China from USD 64.7 billion in 2021 to USD 94.5 billion in 2024, and an expected USD 106 billion in 2025,” GTRI founder Ajay Srivastava said.

On December 16, Minister of State for Commerce and Industry Jitin Prasada told the Lok Sabha in a written reply that the widening deficit is mainly due to imports of raw materials, intermediate goods and capital goods such as auto components, electronic parts and assemblies, mobile phone parts, machinery and its components, and active pharmaceutical ingredients. These inputs are used to manufacture finished products that are also exported from India.

Prasada said an inter-ministerial committee has been constituted to study trends in imports and exports and recommend corrective measures wherever required.

According to GTRI, nearly 80 per cent of India’s imports from China are concentrated in four product groups: electronics, machinery, organic chemicals and plastics.

Between January and October 2025, electronics dominated imports from China at USD 38 billion. This included mobile phone components worth USD 8.6 billion, integrated circuits at USD 6.2 billion, laptops at USD 4.5 billion, solar cells and modules at USD 3 billion, flat-panel displays at USD 2.6 billion, lithium-ion batteries at USD 2.3 billion and memory chips at USD 1.8 billion.

Machinery imports followed at USD 25.9 billion, with transformers alone accounting for USD 2.1 billion, highlighting India’s dependence on Chinese capital goods for power and industrial projects. Organic chemical imports reached USD 11.5 billion, driven by antibiotic imports of USD 1.7 billion, underscoring China’s dominance in pharmaceutical intermediates.

Plastics imports during the period stood at USD 6.3 billion, including USD 871 million of PVC resin, while steel and steel products amounted to USD 4.6 billion. Medical and scientific equipment imports totalled USD 2.5 billion.

“Together, these figures show that India’s import bill from China is anchored in electronics, machinery, chemicals and materials that are difficult to substitute quickly, explaining the persistence of a large bilateral trade deficit despite efforts to diversify supply chains,” Srivastava said.

Meanwhile, India’s exports to China rose sharply in November, increasing 90 per cent year-on-year to USD 2.2 billion. During April–November, exports were up 33 per cent to USD 12.2 billion.

The surge in November was largely driven by higher exports of naphtha, used in the plastics industry. Electronics goods, including printed circuit boards and mobile phone components, also recorded healthy growth during the month.