NEW DELHI: India and China have reached a deal on patrolling their disputed frontier to end a four-year military stand-off, the Indian foreign minister said on Monday, paving the way for improved political and business ties between the Asian giants.
The news came on the eve of Indian Prime Minister Narendra Modi’s visit to Russia for an Oct. 22-24 summit of the BRICS regional grouping, during which he could hold talks with Chinese President Xi Jinping, Indian officials said.
Relations between the world’s two most populous nations — both nuclear powers — have been strained since clashes between their troops on the largely undemarcated frontier in the western Himalayas left 20 Indian and four Chinese soldiers dead in 2020.
The two sides had since stopped patrolling several points along the border in the Ladakh region to avoid new confrontations, while moving tens of thousands of new troops and military equipment closer to the freezing highlands.
“We reached an agreement on patrolling, and with that we have gone back to where the situation was in 2020 and we can say ... the disengagement process with China has been completed,” Indian Foreign Minister Subrahmanyam Jaishankar said at a NDTV media conclave.
The “understanding was reached only today,” he said, adding: “We always said that if you disturb the peace and tranquility how can the rest of the relationship go forward?“
To avoid clashes, the two militaries will patrol contested points along the border according to an agreed schedule, a senior Indian military officer aware of the details told Reuters.
Both sides will monitor the area in Ladakh to ensure that there are no violations, the officer added.
Authorities in Beijing offered no immediate response to India’s remarks.
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Officials in New Delhi said the pact clears the path for a likely bilateral meeting between Modi and Xi on the sidelines of the BRICS summit, which will be their first since 2020.
The senior military officer said that both sides would pull back their troops a little from current positions to avoid face-offs, but would be allowed to patrol these areas according to a schedule that is being worked out.
Monthly review meetings and regular monitoring of the contested areas by both sides would ensure there are no violations, he added.
Deependra Singh Hooda, a retired senior Indian army officer who was a commander for a part of the China frontier, said that while the two sides would need fresh confidence-building measures, “at least the impasse has been broken.”
Slow progress during talks over the last four years to end the stand-off damaged business ties between the two large economies, with New Delhi tightening scrutiny of investment by Chinese firms and halting major projects.
India’s tougher vetting of all Chinese investment after the clashes effectively turned away billions of dollars from the likes of carmakers BYD and Great Wall Motor, and added more red tape in Indian firms’ interactions with Chinese stakeholders.
However, Indian imports from China have surged 56 percent since the 2020 border clash, nearly doubling New Delhi’s trade deficit with Beijing to $85 billion. China remains India’s biggest source of goods and was its largest supplier of industrial products last year.
Asked about the impact of Monday’s pact on trade with and investment from China, Jaishankar said: “It has just happened. There will be meetings to see what the next steps will be. I wouldn’t go so fast.”
India, China reach pact to resolve border conflict, Indian foreign minister says
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India, China reach pact to resolve border conflict, Indian foreign minister says
- The news came on the eve of Indian Prime Minister Narendra Modi’s visit to Russia for a regional summit
- Relations between the two nations have been strained since 2020 clashes on largely undemarcated frontier
India accelerates free trade agreements against backdrop of US tariffs
- India signed a CEPA with Oman on Thursday and a CETA with the UK in July
- Delhi is also in advanced talks for trade pacts with the EU, New Zealand, Chile
NEW DELHI: India has accelerated discussions to finalize free trade agreements with several nations, as New Delhi seeks to offset the impact of steep US import tariffs and widen export destinations amid uncertainties in global trade.
India signed a Comprehensive Economic Partnership Agreement with Oman on Thursday, which allows India to export most of its goods without paying tariffs, covering 98 percent of the total value of India’s exports to the Gulf nation.
The deal comes less than five months after a multibillion-dollar trade agreement with the UK, which cut tariffs on goods from cars to alcohol, and as Indian trade negotiators are in advanced talks with New Zealand, the EU and Chile for similar partnerships.
They are part of India’s “ongoing efforts to expand its trade network and liberalize its trade,” said Anupam Manur, professor of economics at the Takshashila Institution.
“The renewed efforts to sign bilateral FTAs are partly an after-effect of New Delhi realizing the importance of diversifying trade partners, especially after India’s biggest export market, the US, levied tariff rates of up to 50 percent on India.”
Indian exporters have been hit hard by the hefty tariffs that went into effect in August.
Months of negotiations with Washington have not clarified when a trade deal to bring down the tariffs would be signed, while the levies have weighed on sectors such as textiles, auto components, metals and labor-intensive manufacturing.
The FTAs with other nations will “help partially in mitigating the effects of US tariffs,” Manur said.
In particular, Oman can “act as a gateway to other Gulf countries and even parts of Eastern Europe, Central Asia, and Africa,” and the free trade deal will most likely benefit “labor-intensive sectors in India,” he added.
The chances of concluding a deal with Washington “will prove to be difficult,” said Arun Kumar, a retired economics professor at the Jawaharlal Nehru University.
“With the US, the chances of coming to (an agreement) are a bit difficult, because they want to get our agriculture market open, which we cannot do. They want us to reduce trade with Russia. That’s also difficult for India to do,” he told Arab News.
US President Donald Trump has threatened sanctions over India’s historic ties with Moscow and its imports of Russian oil, which Washington says help fund Moscow’s ongoing war with Ukraine.
“President Trump is constantly creating new problems, like with H-1B visa and so on now. So some difficulty or the other is expected. That’s why India is trying to build relationships with other nations,” Kumar said, referring to increased vetting and delays under the Trump administration for foreign workers, who include a large number of Indian nationals.
“Substituting for the US market is going to be tough. So certainly, I think India should do what it can do in terms of promoting trade with other countries.”
India has free trade agreements with more than 10 countries, including comprehensive economic partnership agreements with South Korea, Japan, and the UAE.
It is in talks with the EU to conclude an FTA, amid new negotiations launched this year for trade agreements, including with New Zealand and Chile.
India’s approach to trade partnerships has been “totally transformed,” Commerce and Industry Minister Piyush Goyal said in a press briefing following the signing of the CEPA with Oman, which Indian officials aim to enter into force in three months.
“Now we don’t do FTAs with other developing nations; our focus is on the developed world, with whom we don’t compete,” he said. “We complement and therefore open up huge opportunities for our industry, for our manufactured goods, for our services.”
