India-China Trade Tensions Rise

India and China are gearing up for a showdown, one that might go all the way to the World Trade Organization, over India's increasing reluctance to allow Chinese imports to flood the Indian market. The seemingly incongruous export item that raised hackles this time around? Chinese plastic toys, which have captured anywhere between 60% and 90% of its $2.5 billion toy market, depending on whose numbers you trust. On Jan. 23 the Indian government imposed a six-month ban on the imports of Chinese-made toys. In retaliation, on Feb. 4 the official Chinese government newspaper, the China Daily, reported that Beijing is considering appealing to the World Trade Organization to overturn the measure as an unfair trade restriction.

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