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India can reduce imports from China by 40%

India has the potential to reduce imports from China by around 40 per cent in the coming years, according to an analysis conducted by industry body PHD Chamber of Commerce and Industry.
India holds the immense potential to reduce 40 per cent imports (around $35 billion) from China in the coming times as there are various product categories that India also produces but at a lower volume, Pradeep Multani, President, PHD Chamber of Commerce and Industry, said in the report.

The report titled ‘Prospects and Potential for Enhancing Exports and Reducing Imports of India’, presents a comparative analysis of bilateral trade with the largest importer and exporters of India i.e. China and the USA.

The recent dynamic schemes announced by the Government of India such as the PLI scheme and PM Gati Shakti schemes have enhanced the sentiments of the Indian producers to produce more at a competitive cost which will give considerable competition to China, Multani noted in the report.

In recent years imports from China have increased significantly except the Pandemic year. India imported around $87 billion worth of goods from China in the year 2021 wherein top 10 import product categories comprised around $54 billion.

Imports from China have changed from low-value, low-cost products like toys and crackers to high-value items like electronics, the report said.

Unfair competition from imports from China had a severe impact on the growth prospects of domestic manufacturers, especially small businesses.

According to the report, India has significant scope for producing more import substitution in the sectors including chemicals, automotive components, bicycle parts, agro-based items, handicrafts, drug formulations, cosmetics, consumer electronics, and leather-based goods among others.

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