India & China

India and China appeared to have salvaged relations that came precariously close to faltering just weeks ago over a thorny border dispute as premier Li Keqiang struck a clear note about the need for “mutual strategic trust” and stronger bilateral ties, and the two sides agreed to expand trade and defence cooperation.
The border dispute featured prominently in talks but did not appear to have cast a shadow over wide-ranging discussions that the foreign office characterised as “significant, substantive and productive”. Premier Li’s “warm” and “outgoing” personality set the atmosphere for talks, a senior diplomat said.
The two sides signed a raft of agreements relating to trade, agriculture, meat exports, micro-irrigation and sharing of information relating to flood waters, among others. A joint statement laid out a detailed blueprint for cooperation in areas such as railways, civil nuclear energy and allowing greater market access. A proposed Border Defence Cooperation Agreement did not come up for discussion even though both sides have exchanged drafts.
“We also took stock of lessons learnt from the recent incident in the Western Sector, when existing mechanisms proved their worth. We tasked our Special Representatives to consider further measures that may be needed to maintain peace and tranquillity along the border,” Prime Minister Manmohan Singh said. The two sides will strive to take bilateral trade to $100 billion by 2015, even as China has for the first time agreed to take measures to address the sharp imbalance in trade. “I would say, in the last few years certainly this was the most positive and most practical response that we have got at the high level from the Chinese side,” India’s ambassador to Beijing, S Jaishankar, said. The two sides agreed that allowing greater investments across the border was part of the solution to the trade imbalance problem. The first meeting of the India-China CEOs forum also took place on Monday. The two sides also took forward a proposed free-trade agreement. Li painted an ambitious vision for stronger partnership with the two countries, saying world peace “cannot be a reality without strategic trust between India and China”. “The purpose of my current visit to India is three-fold — to increase mutual trust, to intensify cooperation and to face the future,” Li said, adding that on the basis of deeper mutual trust, the two countries can build a new type of relations between major countries. “That will be a true blessing for Asia and the world.” The two sides agreed to work on a more liberalised visa regime and to expand tourism and people-to-people contact. On India’s concern about the dams China was building on Brahmaputra, Jaishankar said we received a sympathetic response. “They pointed out that they were responsible, that they would not do something which would damage our interests.”
Singh has accepted Li’s invitation to visit China. Ahead of this visit, defence minister AK Antony will visit China soon, as will NSA Shivshankar Menon, who will meet his counterpart.


Chinese Premier Li Keqiang said India and China have the “wisdom” to find mutually acceptable solution to the boundary problem and the two countries have not shied away from addressing the vexed issue.
Mr. Li also said China will support its enterprises to increase investments in India and help Indian products have access to Chinese market as he supported a favourable trade balance in a bid to decrease mounting bilateral trade deficit.
A day after two rounds of talks with Prime Minister Manmohan Singh, Mr. Li said China has the intention to “sincerely” resolving the pending issues, including that of cross-border rivers, and favoured increased bilateral relations between the two big neighbours.
Addressing the Indian industry at a function organised by FICCI in Delhi, the Chinese Premier said cooperation between the two big neighbours will lead to a “new paradigm” of cooperation.
He also quoted a Chinese proverb — a distant relative may not be useful as a near neighbour — to emphasise on the relations between the two neighbours.
Invoking ancient relations between the two, he said, “We will be able to take the bilateral relations to new heights. We have launched a new agenda...taking India-China relations to a new starting point for further growth,” he said.
“We are one-third of world’s total population and our interactions attract the world. Without doubt, China-India relations are most important global relations,” he said.
Stressing on the need for increased people-to-people interaction between India and China, Mr. Li declared 2014 as the year of exchanges between the two nations “so as to boost our understanding and friendship”.
Mr. Li favoured peace and stability in the South-East Asia region and hoped the “relevant issues” will be resolved soon.
“We have also discussed issues of regional security. We hope there is peace and stability in South Asia and a stable South-East Asia is consistent with China’s interests,” he said.
On India-China trade relations, Mr. Li said it is imperative for the two countries to maintain a “dynamic trade balance”.
While striving to realise the trade turnover target of USD 100 billion by 2015, the two countries agreed to take measures to address the issue of trade imbalance. These include cooperation on pharmaceutical supervision, including registration, stronger links between Chinese enterprises and Indian IT industry, the joint statement said.
Mr. Li said peaceful co-existence between India and China will be of global significance and they should seek cooperation from not afar but closely.
The cooperation between the two countries will induct a “new dynamism” in its relations, he said.
Noting that China is still a developing country, he said, “I want the voice of developing countries to be stronger. China and India are linked to each other through natural boundaries. Our friendly relations date back to ancient time.”