India and China have emerged as robust global economic powers
during the last two decades. Their economic interactions,
particularly in the field of merchandise trade, have increased
tremendously. China has already become the second largest trade
partner of India while India's share in China's global trade is
also increasing continuously. With growing trade ties between the
two neighbouring countries, it becomes important to analyse the
distribution of gains from their mutual trade. Hence, this study
attempts to analyse the trends in India's terms of trade with
China. For this purpose, India's Net Barter Terms of Trade (NBTT)
with China has been computed for the period from 1992-93 to
2004-05. For most of the years, during the study period, India
experienced favourable terms of trade with China as compared to its
overall unfavourable terms of trade. However, it has also been
found that India's terms of trade were greatly influenced by one
single commodity named iron ores & concentrates.
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