Tensions between India and China escalated over the military standoff in the Himalayan border territory of Ladakh, leading to China and Hong Kong Customs holding back export consignments from India. At the same time, calls to boycott Chinese goods and halt trade with China are increasing across India.
According to moneycontrol.com, a trade war against China by boycotting its goods would likely hurt Indian interests far more than Chinese, given the size and nature of trade. China is India’s largest trade partner, while India doesn’t even figure in the top 10 of China’s trade partners by total volume. India also has a huge trade deficit with China — it’s largest with any country. In 2018-19, India’s exports to China were $16.7 billion, while imports were $70.3 billion, leaving a trade deficit of $53.6 billion.
These figures show just how dependent India is on Chinese goods. A large-scale boycott will hurt Indian businesses at a time when they are struggling to survive, as India faces its sharpest GDP contraction in decades. In addition, it will India’s ability to manufacture finished goods, as there are hundreds made by Indian companies that require Chinese inputs.
India is one of the biggest exporters of natural stones in the world and dominant in granite exports. According to the Observatory of Economic Complexity, India was the top raw granite exporter in 2018 with $749 million export worth out of the $1.7 billion of the world’s total raw granite trade. China, on the other hand, was the top raw granite importer in 2018 with $574 million import worth.
China is by far the main consumer of India’s granite blocks and slabs, leaving behind the UK, the USA and Italy, which were traditionally the main destinations of India’s raw granite during the past decades. The trend of China’s granite blocks and slabs import value from India during the last decade is shown in the graph below, in comparison with marble’s import value which is almost null.
As for finished granite and marble products, China is once again one of the top trade partners together with the US and Vietnam. The graph below shows the trend of these products exports during the last decade.
As presented, from 2013 to 2015 there was a huge rise in India’s finished granite products exports to China, followed by a tremendous fall in 2016. At the same time, the increase of granite exports meant the decrease of finished marble exports to China, which after 2015 started to rise again, with a small break in 2018.
In the first quarter of 2020, India exported granite and marble blocks and slabs to China of $214.83 million and $1.7 million worth, respectively. In addition, the finished granite and marble products exports reached $0.126 million and $0.128 million worth, respectively.