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China market access slow; Make in India, import balancing key to cutting trade deficit: Sitharaman
As India strives to strengthen its economic foothold, the slow march towards improved market access in China is evident. Finance Minister Nirmala Sitharaman points to a dual approach of propelling domestic manufacturing and managing imports to curb the trade deficit.
India's efforts to secure better market access for its goods in China continue to move slowly, Finance Minister Nirmala Sitharaman said, underlining that boosting domestic manufacturing while carefully managing imports remains central to narrowing the widening trade deficit with its largest trading partner.
Budget 2026 Critics' choice rather than crowd-pleaser, Aiyar says Sitharaman's Paisa Vasool Budget banks on what money can do for you best Budget's clear signal to global investors: India means business In an interview with the News18 Network, Sitharaman said India needs to scale up production capacities at a faster pace even as market access challenges persist in China. She noted that this is where the government's emphasis on Atmanirbhar Bharat and Make in India becomes critical.
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“We are clear that we have to build capacities for essential goods to make in India. At the same time, we haven't restricted imports of some raw materials because we need those goods. Capacities also have to grow, so we are doing a fine balancing act,” Sitharaman said.
India's merchandise trade deficit with China touched a record $116.12 billion in 2025, reflecting strong import dependence despite policy efforts to strengthen domestic manufacturing.
On whether the central government is considering changes to Press Note 3 to attract more foreign investment, Sitharaman said discussions have taken place, though no final decision has been reached. “Some discussions were happening. Not sure where it has reached. Once it arrives at something, I will be able to say,” she said.
Press Note 3, introduced in April 2020 as part of India's Foreign Direct Investment policy, was aimed at preventing opportunistic takeovers of Indian companies during the pandemic. Under the policy, investments from countries sharing a land border with India -- including China -- or where the beneficial owner is based in such countries, require government approval.
The amended rules, which came into effect on April 22, 2020, significantly increased scrutiny over Chinese investments into India.
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Source: EconomicTimes
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