China may top US in India trade

China will likely emerge as India's largest trading partner, overtaking the United States within a few years, with the two-way trade hitting US$100 billion in the near future. The trade between China and India last year hit a record of US$18.7 billion, jumping 38 per cent year-on-year. If the growth is sustained, the bilateral trade could soon overtake Indo-US trade, which is hovering around US$30 billion. But in order to carry on the robust growth, it is crucial to diversify the Indian export basket from primary products to manufactured items and processed products. India's exports to China now are largely restricted to primary and resource-based products, such as iron ore exports, which constitute more than half of India's total exports to China. India and China, dubbed the "double engines" of economic development in Asia, would further benefit if they had a closer relationship with each other. The two countries have many complementary aspects and they can learn from each other. China's development depends highly on foreign trade and investment, while India mainly lies on the growth of domestic enterprises. Each can draw experience from the other. But it is natural for the two populous countries to be rivals in the world's economic arena. Even Indian companies themselves are competing with one another. Competition makes China and India try to have the best enterprises. The feasibility of reaching a free trade agreement (FTA) between India and China seems likely to happen in the future, but it is still premature for now. There needs to be an understanding with each country before such an agreement can be reached