A Study On The Imbalance Between China And India In The Background Of Mengzhong - India - Burma Economic Corridor

Since the establishment of diplomatic relations in 1950, especially in the 21st century, China and India have experienced rapid development of bilateral trade, the value of bilateral trade has been increasing with an average annual growth rate of 43% However, with the rapid growth in total trade, the trade imbalances has been emerged between China and India increasingly, that China’s trade surplus for India continuing to expand. In 2013, the deficit of Sino-Indian bilateral trade amounted to 31.5 billion US dollars, China has become the largest origin of trade deficit among all the countries. Continuous heavy trade imbalances make various frictions of bilateral economic and trade relations intensified, India raised more and more anti-dumping on China,the amount reached 161 till the end of 2013, accounting for nearly 55% of India’s total foreign anti-dumping cases. India has become the most one who raised anti-dumping investigation to China among the developing countries,even the developed countries. The Sino-Indian trade imbalances has seriously affected the relationship of political, economic and trade, it has been draw high concern from the two governments even the world, we must pay high attention to it.Therefore, Based on the relevant international trade theory, from the analysis of the current situation of trade between the China and India, we find the existing problems in bilateral trade, and analyzes the reasons of trade imbalances, then we provide some useful suggestions and countermeasures to strengthen cooperation for win-win further. We divide this paper into four parts:firstly, trade theory are described and analyzed, and points out the status and role of the theory of comparative advantage and factor endowment theory in Sino Indian trade, this provide a theoretical basis for the next step of Sino Indian trade status and causes of trade imbalance. Secondly, according to the standard international trade classification, analyze the current situation of the development of Sino Indian trade, systematically analyze the dominant trade comparative advantage index, trade integration index, competition and complementary index, summarizes the characteristics of the bilateral trade and draw relevant conclusions. Thirdly, the trade imbalance is decomposed into three aspects of quantity and price range with the new framework of three yuan margin, from ternary marginal decomposition of a new angle to analyze the trade imbalance between China and India, the differences of number is the main factor to the imbalance of trade between China and India. The fourth part deeply analyze the causes of trade imbalance between China and India, from the political, economic and trade policy and other aspects.Finally, according to the analysis results, and various factors affecting Sino Indian trade, to improve Sino Indian trade put forward two aspects of economic and political policy proposals aimed at alleviating the imbalance of trade between China and India, persistent imbalances, to create a good trading environment and order, promote the healthy development of the friendly Sino Indian trade.