New Delhi: The world kept watching as China rose to become the world’s largest exporter with its trade surplus surpassing $1 trillion. Monday’s numbers did not come as a surprise as the Asian country has been solidifying its position as a seller of manufacturing goods for over three decades. At its forefront have been industries such as electric vehicles (EVs), solar panels and semiconductors as the country leads in producing renewable energy components, dominating global supply chains.
China’s trade surplus has grown consistently since its last recorded trade deficit in 1993. This growth reflects a deliberate economic strategy that combines efficient manufacturing with global market penetration. China’s trade surplus now accounts for nearly 2 percent of the worldwide economy, with exports in goods and services totaling $3.58 trillion in 2024, rivalling the GDP (Gross Domestic Product) of major nations like India.
India’s trade deficit with China has grown to $103 billion, driven by $120 billion in imports while exporting only $18 billion. This disparity highlights a worrying trend, where India risks becoming overly reliant on China for essential goods, raising concerns about economic sovereignty. Moreover, the two border countries share frosty relations raising even greater concerns.
A similar trend can be seen in nations like Australia, and Japan, and ASEAN members that have experienced a similar trajectory. While their imports from China have surged, their exports to the country have seen significant decline as China increasingly relies on domestic production and minimises external dependencies. Australia, for instance, witnessed a 10 percent drop in exports to China, while ASEAN countries have struggled to balance their trade relationships.
China’s ability to sustain such a massive trade surplus is further bolstered by its currency management and economies of scale. By maintaining a weaker currency, China has made its exports highly competitive on the global stage, effectively outpricing rivals.
This approach, however, has drawn criticism and concerns over fair trade practices. While it has undeniably fuelled growth, it also risks provoking backlash from global economies wary of China’s monopolistic tendencies in critical industries.
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