India-China trade data discrepancy rises to $15 billion in January-October 2023: Report

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November 26, 2023

The magnitude of the discrepancy in the India-China official trade numbers as per data sets released separately by both countries has widened further this year, The Indian Express has reported.

As per the report, the disparity between official figures on exports to India released by China and the imports from China reported by India jumped over 20% to $15.47 billion during the first 10 months of 2023, as against $12.75 billion in the corresponding period last year.

Under-invoicing of imported goods involves marking the stated value of imports below the actual value paid to the foreign exporter, thereby reducing the import tax outgo.

The Ministry of Commerce and Industry in response to a query sent by The Indian Express said it had raised the issue of under-invoicing by Indian importers with the Department of Revenue under the Ministry of Finance and they had informed that for the period from January-November 2022, Directorate of Revenue Intelligence (DRI) and Customs formations had detected 896 cases of undervaluation and investigation and recovery process was underway in these cases. “Further, to check such cases of under-invoicing, DRI and Customs field formations maintain constant vigil and take preventive measures like issuance of suitable alerts/modus operandi circulars etc, and take appropriate action as per law when such cases are detected,” the report has quoted the Ministry as saying.

According to trade experts, the level of discrepancy and the progressive widening of the gap is a cause for concern.

“The magnitude of the discrepancy in the India-China data is really large. It is a cause of concern since foreign exchange is a precious commodity for us. Such differences exist in our trade with the UAE too, but not with the US. Exporters have an incentive to underreport numbers but that is where regulators come in,” Biswajit Dhar, Professor, Centre for Economic Studies and Planning, JNU said.

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