India and China have begun discussions to address bilateral trade concerns, including structural trade imbalances and supply chain issues, with more meetings expected to follow, Commerce Secretary Rajesh Agrawal said on Tuesday.
Agrawal said the recent meeting between Commerce and Industry Minister Piyush Goyal and his Chinese counterpart Wang Wentao was an initial effort to understand each other's positions on trade-related matters.
"I think there will be meetings subsequently also to take these discussions forward. These discussions are happening after a long gap. So, slowly, each side will need to come up with their issues and also their position on issues of the other side, so that we can take this forward," the secretary told reporters.
He said relations between the two countries had improved over the past year in areas such as people-to-people movement and direct air connectivity, including flights between Beijing and Delhi and Guangzhou and Delhi.
Trade deficit remains a key concern
Agrawal said both sides need to work on their respective concerns in the trade sector, including the widening trade imbalance and supply chain issues.
"Both sides should work together to address each other's concern in the trade space...also look at the structural trade imbalance, supply chain issues, and how to build trust in the trade between the two sides...I think both sides are engaged to understand each other's position on many of these issues," he said.
He described the process as ongoing and said both countries were engaging positively to find solutions to trade-related concerns.
"So this is a work in progress. On trade, we have started engaging. Both sides are engaging very positively....They have also opened up...We are also open to engaging with them to find solutions to our trade issues in a manner so that we can structure, we can address supply chain issues, we can address structural and trade imbalances," he said.
Bilateral trade crosses USD 127 billion
The September 12 meeting between Goyal and Wang assumes significance as China remains India's second-largest trading partner.
Bilateral trade increased 7.9 per cent to USD 127.7 billion in 2025-26, from USD 118.39 billion in the previous fiscal.
India's exports to China rose 36.62 per cent to USD 19.47 billion, while imports increased 16 per cent to USD 131.62 billion. As a result, India's trade deficit with China widened to USD 99.19 billion from USD 85 billion.
India sees growth in exports to China
India also continues to maintain restrictions on investments from countries sharing a land border with it, including China.
India received foreign direct investment worth USD 2.51 billion from China between April 2000 and March 2026.
During April-August 2026-27, India's exports to China rose to USD 9.61 billion from USD 6.93 billion a year earlier. Imports increased to USD 65.49 billion from USD 51.56 billion.
Engineering goods, electronic items, petroleum products, organic and inorganic chemicals, and iron ore were among the sectors that recorded healthy export growth.