According to data recently released by the Indian think tank Global Trade Research Program, China-India trade volume reached $118.4 billion in the fiscal year 2023-2024, making China surpass the United States and become India's largest trading partner again.

During this fiscal year, India’s exports and imports to China increased by 8.7 percent, with India’s dependence on Chinaly being to be in the fields of electronics, communications equipment and electrical appliances, with total India’s imports in the fiscal year 2023-2024 reaching $89.8 billion, and China’s supply ratio reaching an astonishing 43.9 percent. This figure not only reveals India’s high dependence on Chinese products in these key industries, but also shows China’s core position in global manufacturing.

However, this trade pattern is not uncontested. Indian economist Melota pointed out that the Indian government has been pushing forward efforts to reduce trade imbalances and increase market access and hopes to this goal by promoting bilateral investment. India continues to pay attention to trade deficits with China, which is also one of the reasons India decides not to join the Regional Comprehensive Economic Partnership Agreement (RCEP).

On the other hand, a positive development of China-India relations is that China appointed Xu Fenghui as its new ambassador to India after 18 months. The appointment of Xu Ambassador was seen as a signal that China-India relations could improve. In a recent joint interview he received, Xu Fenghui expressed understanding of the issue of China-India trade deficit and stressed that China has never intentionally pursued a trade surplus. He said that the Chinese market is open to countries around the world, including India, and welcomes more Indian goods that meet market needs. He also called on India to provide more facilities for Chinese business people to facilitate bilateral trade.

Despite some challenges and controversies, the economic interaction between China and India still shows strong vitality and potential. With changes in the global supply chain and the complexity of geopolitics, cooperation and competition between the two countries in the economic sphere will likely shape a more complex bilateral relationship in the future. How India and China manage and optimize this relationship will not only relate to the economic development of the two countries, but will also affect the broader international trade and economic cooperation pattern.