- Trade deficit with China has been a persistent issue for India, says Sanjeev Sanyal
- China is the world's largest industrial power and cannot be disregarded by India
- India will need to rely on Chinese inputs to become an industrial power for now
Member of the Economic Advisory Council to the Prime Minister of India, Sanjeev Sanyal, agrees that trade deficit with China has been an issue for a while, and even as bilateral ties improve, one has to see how it pans out.
"We cannot wish China away... they are the world's largest industrial power," Sanyal said, while speaking at the NDTV Profit GST Conclave on Tuesday.
Sanyal also added that if India wants to become an industrial power it will have to take a lot of inputs from China for the time being, and may be even longer.
The economist also remarked that the idea that we can protect everything and we can manufacture every single thing at home may not work out and therefore, "You cannot wish away China from the equation. So normalisation with China over time is in our interest as well."
Notably, India's sharpest trade deficit is with China, standing at $99.21 billion in fiscal 2024-25, as per official data. The two countries are the leading economies of the BRICS bloc.
On Monday, External Affairs Minister S Jaishankar while virtually addressing the leaders' summit of the grouping also underlined the trade imbalances India has with several BRICS members.
"Increasing barriers and complicating transactions will not help. Neither would the linking of trade measures to non-trade matters. The BRICS itself can set an example by reviewing trade flows among its member states. Where India is concerned, some of our biggest deficits are with BRICS partners and we have been pressing for expeditious solutions. We hope that this realisation will be part of the takeaways from today's meeting," he said.
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