Research on the Influencing Factors of Sino-Indian Trade Imbalance —— Based on the Stochastic Frontier Gravity Model of Trade

Abstract

India is a populous country second only to China and the second largest developing country in the world. Although the trade level between the two countries has achieved significant results, the trade situation between India and China does not match the market size caused by its population and economic size. India should have become an important destination for China to expand trade, but the issue of trade imbalance between China and India is becoming increasingly serious, constantly hindering the development of trade between China and India. This article selects factors such as economic development level and population size to analyze the influencing factors of Sino-Indian trade. This article expands on the traditional gravity model and adopts a new model for empirical regression experiments. Based on the regression results, summarize the factors that affect the trade imbalance between China and India and draw a conclusion.