Southeast Asian economies seizing China's share of import to India, shows MC analysis

China 's loss has been Southeast Asia's gain when it comes to Indian imports

Southeast Asian economies like Cambodia, Vietnam, Malaysia and Thailand have shipped nearly $10 billion worth of goods to India over the last decade, at a time when China’s dominance in Indian imports has been reducing, according to a Moneycontrol analysis.

India Diversifying Import Pie

China’s exports to India have grown at a CAGR of 9.5 percent between 2021 and 2024, whereas Vietnam’s share has increased 13.4 percent, and Cambodia’s trade has increased 38.9 percent per annum during the same period.

Vietnam, which has become one of the major suppliers of iron and steel products to India, witnessed its share increase from 0.6 percent to 1.4 percent during this period, while Thailand’s share jumped from 1.16 percent to 1.6 percent. An earlier analysis by Moneycontrol had found that Vietnam, which did not export steel products to India before 2018, quickly emerged as one of the country's top five importers in 2024.

During 2021, Vietnam had just a 0.6 percent share of India’s imports, which grew to 10 percent in 2024.

Meanwhile, Cambodia’s exports to India increased 27-times to $342 million from $12.8 million a decade ago and $46.6 million prior to the pandemic.

Indonesia too has emerged as one of the largest suppliers of goods to India from $15 billion to $24 billion between 2021 and 2024.

On the whole, while China’s share in Indian imports increased from 10.8 percent in 2013 to 18.2 percent in 2023, southeast Asia’s share too has jumped from 7.1 percent to 8.5 percent.

China’s Loss is Southeast Asia’s Gain  

Further analysis shows that of the 1,000-plus items under four-digit HS code that China exports to India - worth $14.8 billion – is where Beijing has lost share over the last decade. Meanwhile, the economies of Southeast Asia has been able to increase their share in 257 items.

Most of the gains have come in machinery and electronics segment, where southeast Asia now accounts for $4 billion of India’s imports, while metals contributed another $3 billion.

While the Trump tariffs were paused for trading partners that did not retaliate with a counter-measure, US ratcheted up import levy on China to 145 percent, in retaliation to Beijing’s imposition of 84 percent duty on imports from Washington.

Though the Trump tariffs have been paused, the threat of trade restricting levies is not completely out of sight, especially for China. In such times, India is preparing to impose anti-dumping restrictions on select products to counter the influx of cheaper imports from China, which might result in southeast Asia’s share of trade with India rise further.

China’s exports to India were $125 billion in 2023, while its exports to the US were nearly four-fold at $436 billion. The threat of high tariffs to China has opened the possibility of its goods finding way to other markets at a discount.