INDIA-CHINA BILATERAL RELATIONS

Overview
The relationship with China is a priority in Indian foreign policy. A Strategic and Cooperative Partnership for Peace and Prosperity was established in April 2005. In November 2006 the two countries agreed on a 10-pronged strategy for comprehensive development of this partnership. Prime Minister visited China from 13-15 January 2008. He was received with warmth. PM and Premier Wen Jiabao signed a joint document on “A Shared Vision for the 21st Century between the Republic of India and the people’s Republic of China”, that reflects the congruence of interests that the two countries share on regional and international issues, and our willingness to work together in those areas. This year the two countries are celebrating 60 years of establishment of Diplomatic relations.
High level exchanges
2. The two sides have continued to maintain a healthy momentum of high level exchanges, which include exchange of visits by the Foreign Ministers of the two countries in 2008; visit of UPA Chairperson to Beijing in August 2008 to attend the opening ceremony of the Olympics; the meeting of PM and the Chinese President Hu Jintao on the sidelines of SCO/BRIC summit at Yekaterinburg on 15 June 2009; meeting
between PM and Chinese Premier Wen Jiabao in Hua Hin, Thailand on the sidelines of the ASEAN/EAS Summit on 24 October 2009 and in Copenhagen on 18 December 2009 on the sidelines of the CoP-15 on Climate Change; the meeting of EAM with Chinese FM Yang Jiechi on the sidelines of EAS Ministerial Meeting at Phuket, Thailand on 22 July, 2009; their meeting on the sidelines of the Russia-India-China trilateral Foreign Ministers Meeting in Bengaluru on 27 October, 2009; and most recently CI&M’s meeting with the Chinese Commerce Minister on 19 January 2010 in Beijing.
3. Both sides have agreed that Rashtrapatiji would visit China in 2010. Dates are being worked out. On the invitation of the Chinese Foreign Minister, EAM is also scheduled to visit China this year at a mutually convenient date.
Economic and Trade Relations 4. China is now India’s largest trading partner. According to Chinese statistics, in 2008, bilateral trade reached US$ 51.8 billion-a 34% growth over 2007 with a trade deficit of USD 11.2 billion. In 2009, the annual
bilateral trade reached USD 43.27 billion, trade deficit standing at US$ 15.87 billion. In the face of the global economic crisis our bilateral trade registered a decline of 16.54% compared to the previous year, trade deficit standing at USD 15.87 billion. In the first month of 2010 the bilateral trade between the two countries reached US $ 4.6 billion with a trade deficit of US $ 0.98 billion. The two Prime Ministers mandated their Ministers of Commerce to examine the Feasibility Study on the benefits of a Regional Trading Arrangements. The 8th Ministerial level meeting of the India-China Joint Economic Group was held in Beijing on 19th January, 2010.
The two sides signed a MoU on Expansion of Trade and Economic Cooperation.
Boundary Question
5. Both sides are committed to resolving the India-China Boundary Question through peaceful negotiations and in a fair, reasonable, mutually acceptable and pro-active manner, and as a strategic objective. The Agreement on Political Parameters and Guiding Principles for the Settlement of the India-China Boundary Question was signed on 11th April, 2005. The Special Representatives of the Prime Ministers of
India and China have held 13 rounds of talks on an appropriate framework for a final package settlement covering all sectors of the India-China boundary. Both sides have reiterated that pending the resolution of this issue, peace and tranquility must be maintained in the border areas in accordance with relevant agreements signed in 1993, 1996 and 2005.
Defence Cooperation
6. Efforts to build trust and confidence between the militaries are proceeding satisfactorily. The third Annual Defence Dialogue was held in Beijing on 6 January 2010. The last joint military exercise on counterterrorism was held in Belgaum in December 2008. In November 2008 Indian Chief of Air Staff visited China and Chinese PLA Navy Chief visited India. CNS attended the International Fleet Review 2009 at Qingdao in April 2009. Deputy Chief of General Staff of Chinese PLA visited India from 1-6 December, 2009.
Cooperation in other areas
7. The two sides are also cooperating in a number of functional areas, including in finance, agriculture, water resources, energy, environment, tourism and information technology. MOUs have been signed in several fields in the past few years to strengthen our collaboration in these fields. To boost cooperation in science and technology the two countries have established an India-China Partnership in Science and Technology. This year the two countries are organizing a ‘Festival of India’ in China and a ‘Festival of China’ in India to promote greater awareness of each others’ culture. India and China also have an annual youth exchange programme. The two countries also have an Exchange Programme between Ministry of External Affairs, India and International Department of Communist Party of China under which Chief Minister of Karnataka visited China in September, 2009.
8. The two countries have also been furthering cooperation in regional and multilateral fora on global issues such as world trade negotiations and energy security. The two countries have been cooperating very closely on the climate change issue. MoS for Environment and Forest visited China in August and November, 2009 to coordinate positions with the Chinese side. During CoP-15 at Copenhagen the two Prime Ministers held bilateral consultations to ensure that the goal of developing countries in dealing with challenges of climate change were met satisfactorily and comprehensively.
(Source: Ministry of External Affairs, GOI, 2010)