Analysis Of The Influencing Factors Of Sino-Indian Trade Imbalance

As two major emerging economies,China and India are the engines of global economic development.At the same time,the rapid development of Sino-Indian trade has been sustained for more than two decades,from only $1.2 billion in 1995 to $95.87 billion in 2018.China has long been the largest importer and the third largest exporter of India.However,India has been in a trade deficit for a long time,and the deficit has skyrocketed year by year in the process.In recent years,China has been India's largest source of deficit.The trade deficit not only seriously hinders the economic exchanges between China and India,but also has a negative impact on the political relations between China and India.This paper traces the causes of China-India trade deficit and puts forward the corresponding countermeasures to promote the healthy and sustainable development of trade relations between the two countries and benefit the people of the two countries.Through the literature study of relevant experts and scholars in China and abroad,it is found that the research on Sino-Indian trade mainly focuses on the characteristics of Sino-Indian trade products,commodity structure,the causes and countermeasures of China-India trade deficit.According to the current mainstream view,India's backward infrastructure construction,backward industrial level,various restrictions on labor force and land policy are the root causes of China-India trade deficit.In this paper,a large number of relevant data of Sino-Indian trade are collected,and the interdependence,deficit structure,commodity structure and characteristics of Sino-Indian trade are analyzed in the form of charts,and then the econometric model is used.This paper focuses on the exchange rate of RMB to Indian rupee and the national savings rate of China and India,the labor force participation rate of China and India how to influence the trade deficit between China and India,and puts forward some feasible measures to solve the problem.With regard to the trade deficit between China and India,my response is that China needs to expand direct investment in India,encourage domestic consumption,promote domestic consumption upgrading,actively promote the Sino-Indian currency swap agreement,strengthen the complementarity of Sino-Indian trade,properly solve the Sino-Indian trade frictions,and actively promote the construction of Sino-Indian Free Trade Area.