Akshat Srivastava, founder of Wisdom Hatch, in a post on X laid bare the economic chasm between India and China with a stark comparison: while China’s trade surplus stands at a staggering $1 trillion—26% of India’s GDP—India grapples with a $73.5 billion trade deficit.
“Both countries were net importers until the late ’80s. Today, China is building next-gen exports in robotics, semiconductors, and AI. India? Our biggest hope seems to be exporting smart people and relying on remittances,” he wrote.
The numbers reflect a deep reliance on Chinese imports, especially in critical sectors such as electronics, chemicals, and renewable energy. Despite initiatives like the Production-Linked Incentive (PLI) scheme, launched in 2020 to strengthen domestic manufacturing, India’s dependency has only grown, raising questions about its global competitiveness.
Economists argue that India needs structural reforms to address this imbalance.
Deloitte India’s Rumki Majumdar advocates for increased investment in research and development: “India must enhance its manufacturing competitiveness by moving up the value chain and incentivizing local production.”
With Union Budget 2025 around the corner, experts are urging decisive measures. Expanding the PLI scheme to include more sectors, diversifying supply chains, and encouraging foreign direct investment (FDI) are some of the strategies being discussed.
Gopal Jain, Managing Partner at Gaja Capital, recently called for a pragmatic approach: “India must welcome global investments and focus on creating mutually beneficial trade partnerships. This is crucial for reducing dependency and strengthening our economic resilience.”