Takshashila Discussion Document - Demystifying India-China Trade Possibilities

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Executive Summary

An Indian proverb rings true of the economic ties between India and China - ‘for the friendship of two, the patience of one is required’. The time is not yet ripe for an India-China free-trade agreement though this discourse is vital in understanding where the two countries stand and how each of their futures could shape up. At this stage, a free-trade agreement with China would largely confer one-sided benefits to China as has already been happening in the bilateral trade relations without the FTA. By realising its manufacturing potential and developing mature and competitive industries, India will be prepared to face competitive pressures from China and other prospective FTA partners. Without such reforms and more, an FTA with a manufacturing behemoth like China may lead to a destruction of its domestic industrial architecture and probably have a detrimental effect on poverty through loss of worker-oriented industries.

Author

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V. Anantha Nageswaran
V. Anantha Nageswaran

V. Anantha Nageswaran is the current Chief Economic Adviser (CEA) to the Government of India. He is an economist and has worked for Credit Suisse in Switzerland and Singapore, and for the Union Bank of Switzerland. He was previously a councillor and a co-founder of the Takshashila Institution.

Ritwick Ghosh
Ritwick Ghosh

Ritwick Ghosh is a post-doctoral researcher at the Arizona State Univeristy. He is an inter-disciplinary social scientist with expertise in agricultural governance, economics, and politics. Specifically, he examines the challenges in governing agri-environmental transitions, biodiversity losses on private lands, and climate mitigation.

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