The study revealed that the number of such product lines has risen from 44 in 2018-19 to 71 in 2025-26, depicting an increase of more than 60 per cent.
The report, jointly produced by the Koan Advisory Group and the Institute of Chinese Studies, examines bilateral trade at a granular product-line level, beginning with electrical and electronic equipment under Harmonized System (HS) Chapter 85.
The Harmonized System (HS) is the internationally standardised code used to classify traded goods. HS Chapter 85 covers electrical machinery and electronic equipment.
Of the 71 tariff lines where China supplied at least 80 per cent of imports, 46 crossed that threshold only after 2018-19, indicating that India's import concentration has increased over time. "The large number of tariff lines in the 90–99 per cent band highlights how deeply embedded Chinese sourcing has become in India's electronics imports," the report noted.
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The report characterises the imbalance as long-term in nature. "India's trade deficit with China is structural rather than cyclical, remaining concentrated in the same major HS chapters over time and continuing to widen," it added.
The scale of that imbalance is substantial. India's overall trade deficit with China reached $112.1 billion in 2025-26, of which electrical machinery alone accounted for $43.1 billion — roughly 38 per cent of the total. Though HS 85 is India's largest export chapter to China at $3.18 billion, the figure is dwarfed by imports in the same category, the report highlighted.
Lithium-ion batteries emerged as a key pressure point. India's imports from China have more than doubled since 2021-22 to $3.9 billion, with China's share climbing to 83.6 per cent, crossing the 80 per cent dependence threshold for the first time in 2025-26. "The sharp increase highlights lithium-ion batteries as an emerging area of strategic dependence for India's electronics and electric mobility ecosystem," the report said.
The study also found that China supplied 48.9 per cent of India's semiconductor imports, even after its share fell from around 64 per cent a year earlier.
The report argued that dependence of this kind cannot be addressed by restricting imports, since the gap lies in upstream components rather than finished products. "As long as the components feeding Indian assembly lines continue to originate almost entirely from China, the trade deficit in this chapter will remain structurally anchored, regardless of growth in domestic electronics output," it said.
Instead, it calls for policy to prioritise the localisation of upstream component manufacturing, supported by India's critical-minerals strategy and, in segments where domestic alternatives remain unviable, a calibrated framework for selectively permitting Chinese manufacturers to produce inside India.
“The ultimate objective is a calibrated shift from persistent reliance on imports toward locally embedded manufacturing capacity,” the report concluded.
