China's exports jumped 36% in September. Why India should pay attention

On 14 October 2026, China's customs agency reported that the country's exports grew 36.3% in September from a year earlier. Economists had expected less. It was China's fastest export growth since February, according to FactSet data cited by AP.

China's trade surplus, the amount by which its exports exceed its imports, reached $938 billion in the first nine months of 2026. The world's factory is selling more than ever, and India is one of its biggest customers.

What happened in September

Exports rose 36.3%, up from 25% growth in August. Imports grew too, by 31%, but from a much smaller base. The result: a monthly surplus of $133.5 billion, wider than August's $119.1 billion.

China's full-year surplus in 2025 was a record $1.2 trillion. With three months still to go, 2026 is on course to come close to that or beat it.

What China is selling

This isn't a boom in cheap toys and textiles. The fastest growth is in high-tech goods, helped by the global spending rush on artificial intelligence and by demand for Chinese electric and hybrid cars.

A weaker yuan has also made Chinese goods cheaper abroad, policymakers in other countries say. Beijing says it has "no need or intent" to gain an edge by devaluing its currency.

Why the world is pushing back

A trade surplus this large means China's factories are producing far more than its own people are buying. Home demand is weak after a years-long property slump, and the IMF has cut its forecast for China's 2026 growth to 4.5%.

Trading partners worry that the overflow will swamp their own industries. Cornell economist Eswar Prasad told AP that many fear their manufacturing industries will be overrun by Chinese exports.

• EuropeThe EU's trade deficit with China is more than $1.1 billion a day. EU trade chief Maroš Šefčovič says a deal with Beijing will halve Chinese hybrid car imports into the EU over the next few years.
• United StatesWashington is investigating excess industrial capacity in China and other partners, even as the two sides extended their trade truce. For how that rivalry began, see the 2018–19 trade war.

Where India fits in

China is now, by a wide margin, the biggest source of India's imports.

Between April and August 2026, India imported $65.49 billion of goods from China, up from $51.56 billion in the same months last year, a rise of about 27% (FIN2DAY calculation). That is about 18% of India's total goods imports of $363 billion in the period (FIN2DAY calculation).

Trade runs mostly one way. India exported only $9.61 billion of goods to China in those five months, leaving a gap of about $55.9 billion (FIN2DAY calculation).

In 2025-26, India's imports from China hit $131.6 billion while exports were $19.47 billion, a trade deficit of $112.16 billion. Electronics ($46.36 billion) and machinery ($29.45 billion) made up more than half of those imports (FIN2DAY calculation), according to commerce ministry data reported by ThePrint.

Good news or bad news for India?

Both, depending on where you sit.

• Cheaper inputsMany Chinese imports are parts and machines that Indian factories need, from phone components to solar equipment. Cheaper Chinese goods can keep costs down for Indian assemblers and buyers.
• Pressure on local makersIndustries such as steel worry about goods sold below fair value. In December 2025, India imposed a five-year anti-dumping duty on certain Chinese steel products after an investigation by the Directorate General of Trade Remedies (DGTR).
• The rupeeEvery dollar paid for imports adds to the demand for dollars. A wider trade gap with China adds to the pressure on the rupee, alongside expensive oil and foreign investors selling Indian shares. See our explainer on the Fed and the rupee.
• Diverted goodsIf Europe and the US make it harder to sell to them, Chinese exporters look for other markets. Large economies with lower barriers, including India, can see more of those goods arrive.