China is India’s Best Trade Partner.

India’s Asian neighbour, China has emerged as its biggest trading ally. According to an influential report compiled by PHD Chamber of Commerce, China has surpassed the United Arab Emirates (UAE) that had held this honour until the last fiscal year and pushed it to the third spot. The United States of America (USA) maintains its customary second spot. Considering the cross border tension faced by these two Asian giants, this news of renewed economic cooperation could be just what the doctor ordered.

The Indo-China trade for this fiscal has reached $49.5 billion, which amounts to about 8.7% of India’s overall international trade. The USA comes in a close second at $46 billion, amounting to 8.1% of India’s gross trading share, while at 8% overall and $45.4 billion, UAE slips to the third spot. This numbers reflect stats concerning the first nine months of this current fiscal year.

This is a momentous business situation for India and China- rising from a paltry $7 billion in 2004, to $38 billion in 2008 and hit $65 billion in 2013. This trend showcases India’s changing economic partnerships and arrangements- from the erstwhile collaborations with conventional trading partners to the current shift of engaging with upcoming and developing economies.

In terms of imports and exports, the US is still India’s top export destination. Through April-December 2013, India’s exports to the US stood at $29.3 billion, followed by UAE at $22.3 billion and China at $10.8 billion. However, the Indian import scenario is an ever-changing landscape, with countries like Saudi Arabia, UAE, Kuwait, Qatar, Iraq and Switzerland emerging as the country’s top import sources.