India has asked China to slash import duties on cotton fabric in order to bridge the growing trade deficit with the country. The two sides discussed ways to increase exports from India in order to contain the trade deficit that has widened despite a 10 per cent contraction in total trade during the year. They also discussed the need for setting up centers in India for servicing the large number of power equipment exported by China.
India has proposed reducing duty of cotton fabrics being imported into China from the current 10 per cent to 5 per cent. This can enhance cotton fabric exports from India.
Both India and China have agreed that the working group on trade and economic cooperation should meet in September along with another working group on trade in services and trade statistics. The Joint Economic Group (JEG) meet is likely to be scheduled in late October in Beijing.
In the last JEG meeting with China in August 2012 in New Delhi, India had handed over to China the roadmap for enhanced cooperation between India and China in the IT and pharmaceutical sectors.