Imports from China falls but inwards shipment from Hong Kong increases

Imports from Hong Kong into India have been increasing even as inward shipment from China is coming down.

India’s imports from Hong Kong were $17 billion in the previous financial year, with electronics, telecom equipment and computer hardware being almost $8 billion of the total. This is a sharp rise from $10.67 billion imports in 2017-18 and a worrying trend of China changing its export routes even as India seeks to reduce its import dependence on China, said the Confederation of All India Traders (CAIT).

The industry body expressed its concern on the surge in imports from Hong Kong to India, especially at a time when the country has been trying to reduce its dependence on China.

CAIT has also urged Commerce Minister Piyush Goyal to look into the issue. A close analysis of the imports data revealed that for all the major commodities in which India’s imports from China have declined, a corresponding increase has been observed with Hong Kong, CAIT secretary general Praveen Khandelwal, said in a statement.

These commodities are mainly electrical machinery and equipment, fruits, minerals and iron and steel among others, he said.

India’s trade deficit with China has always been a major concern for India and the recent reduction in the trade gap is a tactical attempt from China to camouflage the real value of trade deficit, the statement further pointed out. “There seems to be a one-to-one product correlation of reduced export from China to India and corresponding increase from Hong Kong to India, during the same period,” Khandelwal said.

Meanwhile, India’s trade with China a drop of 7 per cent in 2019-20 to $109.76 – the sharpest fall in the last seven years. In 2018-19, trade between the two countries grew by only 3.2 per cent after a huge increase of 22 per cent in the previous financial year..