Home / News / World /  What exactly did Narendra Modi’s China visit yield?

Prime minister Narendra Modi concluded his first three-day trip to India’s northern neighbour China on Saturday.

In Modi’s own words, the India-China relationship is a “complex" one with the two Asian giants eyeing each other with suspicion. Two key irritants bedevilling ties are a decades old unresolved border problem and a ballooning trade deficit that threatens to cross $40 billion this year. Added to this is the “all weather friendship" between China and Pakistan and China’s recent announcement of $46 billion in investments in an economic corridor through Pakistan and a section of disputed Kashmir.

The Modi visit yielded no breakthroughs on the border or on how to bridge the trade gap. Neither were expected given the complicated nature of the issues.

Instead, the two sides have come up with some non controversial “do-ables" taking into account their complementarities. This list provides a blue-print for stabilising the relationship and adding the critical mass necessary for a takeoff in relations in the future when the time comes.

Here are five takeaways from the 14-16 May visit to China:

$22 billion in business-to-business pacts

Indian and Chinese firms signed 21 agreements worth more than $22 billion in deals in areas ranging from telecom, steel, solar energy and films. The pacts came on the third and final day of Modi’s trip to China during a visit to Shanghai. Modi highlighted the complementarities of the two Asian giants noting that China was the factory of the world and India the global back-office. Modi also spoke to Chinese CEOS about his key “Make in India" programme.

Military headquarters hotline connection

Pending a resolution to their boundary dispute, India and China have decided to set up a hotline between the military headquarters of the two countries. To build trust between the two militaries, China’s Vice Chairman of the Central Military Commission will visit India and India’s defence minister will visit China.There will also be an increase in the number of meetings between border personnel and commanders at all sectors of the India-China border areas. Exchange of naval visits as well as joint counter terrorism training has also been suggested. expand the exchanges between the border commanders, and establish border personnel meeting points at all sectors of the India-China border areas.

Task force to counter widening trade deficit and market access issues

The task force will look at ways to reduce the trade deficit that was $38 billion in 2013-14 and expected to be in the range of $40 billion - $45 billion in 2014-15. India has also been complaining of problems faced by its IT and pharmaceuticals firms while trying to enter the Chinese market. Chinese companies on the other hand have also complained of problems while trying to invest in India.

Two dozen government to government pacts

The agreements were in the area of cooperation in skill development, railways, mining and minerals, broadcasting, tourism, ocean studies, establishing sister city relations and consulates in Chennai and Chengdu.

E-visa facility extended to Chinese nationals

In a bid to boost tourism and advance people to people ties, Modi announced that India had decided to extend electronic visa on arrival facility to Chinese nationals. The announcement is expected to increase two way flow of people as the years 2015 and 2016 have been designated ‘Visit India’ and ‘Visit China’ years respectively.

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