NEW DELHI, July 18: India’s trade deficit with China is expected to reduce during the current financial year as the government is taking steps to check the trend, Parliament was informed today.
“With a view to reduce India’s trade deficit with China, efforts are being made to diversify the export basket with an emphasis on manufactured goods,” Commerce and Industry Minister Nirmala Sitharaman said in a written reply to the Lok Sabha.
The government is also pursuing issues of market access for products with strong export potential, to tackle non- tariff barriers in the Chinese market at different fora.
“India’s trade deficit with China is expected to reduce during 2014-15 to some extent due to steps being taken to restrict the same,” Sitharaman said.
The adverse trade balance is being addressed by encouraging China’s investment towards building manufacturing capacities in India, through investment in India’s industrial parks and SEZs, she added.
Recently, India and China signed an MoU on cooperation on industrial parks aimed at attracting Chinese investments.
“These measures are expected to boost exports and reduce India’s trade deficit to some extent,” she said.
Limited market access to Indian products in China is one of the major reasons for widening deficit.
“The limited market access afforded to Indian products in China is also a contributing factor to the growing trade deficit. Indian IT services exports also face barriers in China and therefore unable to compensate for the deficit on account of our merchandise trade with China,” Sitharaman said.
The deficit during 2013-14 was USD 36.22 billion.
Replying to another question on trading firm-STC, the minister said the company has reported a loss of rs 492 crore in 2013-14 due to provisions and write offs.
She also said certain instances of irregularities were noticed in transactions of earlier years in STC which relates to import of pulses, bullion, raw copper, agro commodities.
“Various actions including legal/arbitration proceedings are on against associates for recoveries. STC has been reviewing and revising its trade guidelines from time to time to prevent re-occurrence. A risk management framework has been put in place by STC to objectively assess risks involved in each trade proposals,” Sitharaman said.
Replying to another question, she said the government is planning to open more border haats in the country.
“The government has shared a list of 22 locations in Meghalaya with the government of Bangladesh for their concurrence to establish border haats,” she said.
The haats aim at promoting the wellbeing of the people dwelling in remote areas across the borders of two countries by establishing traditional system of marketing the local produce through local markets. (PTI)
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