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China's recent move to ease export restrictions on fertilizers, rare earths, and tunnel-boring machines to India is a welcome step, but self-reliance remains the only real safeguard for New Delhi against its widening trade deficit with Beijing, the Global Trade Research Initiative (GTRI) said in a report.
The GTRI report highlighted that India cannot ignore its deep economic dependence on Chinese imports. This development follows Beijing's earlier curbs on critical minerals such as gallium, germanium, and graphite that disrupted India's electronics and electric vehicle sectors. In June 2025, Chinese battery giant CATL even withdrew engineers from Foxconn's Chennai plant, halting operations. Despite the recent relaxation, the economic imbalance remains stark. India's trade deficit with China has touched a record USD 100 billion in FY2025, while Beijing has openly supported Pakistan in the recent war. Such dependence, the GTRI cautioned, gives China significant leverage during crises. A trade deficit occurs when a country buys more goods and services from other countries than it sells to them. GTRI also noted that the problem is structural. China currently supplies over 70 per cent of India's requirements in several key areas. Everyday products are no exception, with laptops (80.5 per cent) and flat panel displays (86 per cent) dominated by Chinese imports. Adding to the concern, India's share in bilateral trade has collapsed to just 11.2 per cent from 42.3 per cent two decades ago. This sharp decline highlights the fragility of India's supply chains and growing reliance on Chinese inputs. To address this imbalance, the GTRI suggested that India move on multiple fronts. It recommended a reverse-engineering programme using IITs and CSIR labs to deconstruct imported goods and create open-access blueprints. These efforts could be tracked through a proposed "Localize-100" system to focus on the most critical imports. The report stressed that while China's easing of curbs is a useful signal, it cannot mask the underlying imbalance in the relationship. For India, the only real shield lies in strengthening domestic manufacturing, cutting dependence on imports, and building resilient supply chains. "A stronger, more self-reliant India will be better placed to engage China on equal terms, while keeping relations steady and pragmatic rather than hostage to sudden shifts," the report said. In conclusion, GTRI noted that China's gesture is only a tactical move. India's true safeguard lies in reducing dependence, investing in deep manufacturing, and becoming a product nation capable of withstanding external pressures. (ANI)
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