China recorded an unprecedented trade surplus of almost $1.2 trillion in 2025, setting a new historical benchmark. This figure, specifically $1.189 trillion, significantly exceeded the previous record of $992 billion reported in 2024 and $838 billion in 2022. The robust performance was largely attributed to a strong export surge in December 2025, which saw outbound shipments increase by 6.6% year-on-year, surpassing market expectations. Imports also registered an unexpected rise of 5.7%. This record surplus highlights China's continued reliance on its manufacturing and export sectors to bolster its economy, especially amid a prolonged domestic property downturn and subdued consumer demand. The country has successfully diversified its trading partners, redirecting sales to alternative markets, particularly in Southeast Asia, Africa, and Latin America, to mitigate the impact of tariffs imposed by the United States. This strategy has enhanced China's ability to withstand external risks. The outlook for 2026 suggests that exports will remain a key driver of the Chinese economy. While some forecasts anticipate a moderation in export growth to around 3.0% from 5.1% in 2025, others, like Goldman Sachs Research, project a 5-6% annual growth in exports, leading to an upward revision of GDP forecasts. However, this substantial surplus is viewed as potentially unsustainable and could intensify trade friction with other nations, particularly as China moves into advanced manufacturing and exports products like electric vehicles, which may face increased tariffs. The growing imbalance between China's production capacity and domestic consumption continues to feed this export-led growth model. For an Indian audience, this news is highly relevant as India recorded a significant trade deficit with China in 2023. The ongoing expansion of China's trade surplus and its global trade strategies can have direct and indirect implications for India's trade balance, manufacturing sector, and overall economic strategy.