India's Trade Dependency on China and EU Grows Amidst Global Shifts

India's trade relationship with China and the European Union (EU) is intensifying, reveals a recent report by the UNCTAD.

Key Points

Rising Trade Reliance on China and EU: India's trade dependency on China and the EU is escalating, indicating a significant geopolitical realignment in global trade dynamics.
Impact of Pandemic: The surge in India's reliance on these regions follows major disruptions caused by the pandemic and the Russia-Ukraine conflict, which elevated food and fuel prices to unprecedented levels.
Geopolitical Trade Patterns: The UNCTAD report suggests a shift towards bilateral trade agreements based on shared geopolitical interests, with a concentration of global trade among countries with similar stances.
Impact of Russia-Ukraine Conflict: The ongoing war has led to substantial trade adjustments, with Russia's trade dependency on China skyrocketing while diminishing with the EU.
US-China Trade Dynamics: The US managed to decrease its reliance on China while strengthening ties with the EU and Mexico, indicating strategic trade diversification efforts.
Sectoral Trade Trends: Global trade witnessed a decline across various sectors except for pharmaceuticals and transportation equipment, with merchandise trade experiencing continuous contraction.