Trade Patterns Of China And India

1355 Words Apr 11th, 2016 6 Pages
This essay is an analysis and comparison of the trade patterns of China and India since 2000 and studies the effect of the regulating economic and national policies on the trade performance.
Being old neighbors India and China have shared a lot in common like the culture, sciences and also a few economic linkages. They also have the largest populations in the world: India with 1311 million and China with 1376 million in 2015(Esa.un.org, 2016). Since 2000 trade between the two countries has mushroomed nearly twice as compared to each country’s trade with the world. Currently, China is India’s largest trade partner surpassing United States and India being China’s tenth largest exporter. These two giants have a great impact on the world
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The period of trade decline and world recession (1998-2008), after China’s admission to the WTO in 2001 was marked by Chinese economy opening up to world trade.
According to the WTO‘s Trade Profiles 2015, China is the leading merchandise exporter in the world and second largest importer just after United States in 2014 (Wto.org, 2015). China being a lucrative destination attracted a very high inflow of investment (foreign direct investment). Thus once very predominant part of Chinese foreign trade the Textile and Apparel industry is being gradually replaced by sectors like machinery and transport equipment, which are relatively capital intensive.

2.2. INDIA
India initially, post independence and till the late 1980s adopted a strategy of import-substitution and public sector production which made it a quiet closed economy. Since the economic reforms in early 1990s, India has slowly adopted more liberalized strategies, which opened its economy for international trade and foreign investments. Post 1991 reforms there were measures taken to support domestic players and promote exports making India complex for foreign trade.
Despite of the complex policies and restrictions foreign investors were confident of India 's economic growth as even during the peak of the global economic crisis, the country 's GDP registered a healthy growth rate. India 's merchandise trade increased to 40% as a percentage of GDP in 2009-2010 from 30% in
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