Chennai: While India’s imports from China touched $131.6 billion in FY26, about 66 per cent valued at $82.6 billion goes to four sectors – electronics, machinery, computers, and organic chemicals.
China accounts for 43 per cent of India’s electronics imports, 40 per cent of machinery and computer imports, and 44 per cent of organic chemicals. These are core inputs that feed directly into India’s manufacturing ecosystem, finds GTRI.
This dependence is less about consumption and more about weak domestic production. Indian industry relies heavily on Chinese inputs—electronics parts, EV batteries, solar modules, APIs and specialty chemicals—that are hard to replace at scale.
“This creates clear risks. Dependence on a single supplier for critical inputs leaves sectors like pharmaceuticals, electronics and clean energy exposed to disruptions, whether geopolitical or commercial. At the same time, India’s exports to China remain limited, keeping the relationship one-sided,” SAID Ajay Srivastava, founder , GTRI.
As India eases investment restrictions on China, the Chinese automakers are likely to expand through local assembly and increased EV imports if tariffs fall, putting pressure on Indian firms and reshaping supply chains. Chinese companies may continue sourcing key inputs—such as auto components, batteries, polymers, coatings and adhesives—from China rather than local suppliers. This could reduce domestic value addition and hurt upstream industries.
The policy challenge is clear. India needs to build domestic capacity in key sectors and diversify supply chains. A practical starting point would be to limit dependence on any single country to below 30 per cent of imports in critical sectors, finds GTRI.
Exports to China remain stuck below FY2021 levels at $19.5 billion, while imports have more than doubled to $131.6 billion, pushing the deficit up 155 per cent to $112.1 billion in five years. More worrying is the composition: 98.5% of imports from China are industrial goods, and four sectors—electronics, machinery, computers and organic chemicals—alone account for $82.6 billion.
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: deccanchronicle.com
