Discussing India-China Relationships with Focus on Specialty Chemicals and Pharmaceuticals

Abstract

With growing political and economic tension between nations combined with the COVID-19 threat, new challenges arrive that must be addressed for future growth – and one such challenge is the economic impact of India-China relations. Trade tensions between the US and China have also impacted Indian industries, amongst many other factors. The pandemic has increased economic dependence of other nations on India and China, although trade relations between the two growing economies reflects a wide deficit in the favour of Chinese industries. The objective of this study is to analyse the US-China trade war as well as India-China relations and its impact on Indian industries, specific to Pharmaceuticals and speciality chemicals, in order to ascertain the key pain-points and consequences on future growth. Using both existing research and empirical data, it was found that both the pharmaceutical and speciality chemicals industries in China held more prominent international presence with Indian industries being dependent on China most notably for raw materials in the same markets. This was despite evidence that showed India’s growing trade presence and a significantly longer list of approved internationally traded drugs, reflecting growing presence but continual dependence and lower traded volume in international markets.