India-China Trade Surges 29% to $91.76 Billion, Exceeding US Trade in First Half of FY27
India’s bilateral trade with China surged nearly 29% year-on-year to $91.76 billion during the first half of the fiscal year 2026-27, according to data from the commerce ministry. This increase positions China as India’s largest trading partner, surpassing the United States, which saw its trade with India rise by 16.5% to $83.14 billion in the same period. In the corresponding timeframe of 2025-26, trade with China was recorded at $71.24 billion.
India’s exports to China rose significantly by 36% to $11.41 billion, up from $8.38 billion a year earlier. Meanwhile, imports from China climbed 27.82% to $80.34 billion, compared to $62.86 billion in the previous year. This imbalance has widened India’s trade deficit with China to $68.93 billion, up from $54.06 billion in the first half of FY26.
India-US trade rises, but surplus narrows
India’s trade with the United States also saw an increase, reaching $83.14 billion in the first half of FY27, up from $71.39 billion a year earlier. Exports to the US grew by 11.11% to $50.81 billion, while imports surged 25.98% to $32.32 billion. As a result, India’s trade surplus with the US narrowed to $18.49 billion from $20.07 billion in the same period last year.
Despite challenges related to tariffs, the US remains India’s largest destination for merchandise exports. Commerce Secretary Rajesh Agrawal noted that negotiations for a proposed India-US trade agreement are progressing positively, with both nations aiming to finalize the deal soon. The agreement’s success hinges on the completion of the broader US tariff framework.
India looks to rebuild trade ties with China
The uptick in trade with China coincides with India’s efforts to mend bilateral relations. Commerce and Industry Minister Piyush Goyal stated that India is actively working to rebuild its relationship with China, although the outcome remains uncertain. Agrawal confirmed ongoing discussions between the two countries on trade-related matters, emphasizing that continuous dialogue is essential for improving trade ties.
Exports rise across markets in first half of FY27
The commerce ministry’s data also revealed notable changes in India’s trade with other nations during April-September 2026-27. Exports to Singapore soared by 103%, while shipments to Tanzania increased by 122.5%. However, exports to the UAE, Netherlands, and Saudi Arabia experienced declines.
On the imports front, shipments from Oman surged by 210.9%, and imports from Brazil rose by 143.13%. Conversely, imports from the UAE, Saudi Arabia, and Switzerland fell. In September alone, India’s merchandise exports increased by 23.04% year-on-year to $44.4 billion, while imports rose by 8% to $74.61 billion. The merchandise trade deficit narrowed to $30.21 billion in September from $33 billion a year earlier. Cumulatively, merchandise exports for the first half of FY27 reached $259.89 billion, while imports totaled $437.53 billion, resulting in a trade deficit of $177.64 billion, up from $156.88 billion in the same period last year.
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