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Business News/ News / World/  India, China to hold strategic dialogue on Monday
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India, China to hold strategic dialogue on Monday

Analysts see the meet as a confidence building measure aimed at normalizing ties after the 1962 conflict

The talks follow last week’s meeting between Manmohan Singh and Wen Jiabao in Cambodia, during which Singh had sought increased Chinese investment into India. Photo: PIB (PIB)Premium
The talks follow last week’s meeting between Manmohan Singh and Wen Jiabao in Cambodia, during which Singh had sought increased Chinese investment into India. Photo: PIB
(PIB)

New Delhi: India and China will hold their second strategic economic dialogue on Monday aimed at increasing engagement in areas such as infrastructure and high-technology sectors against the backdrop of the global economic slowdown, Indian officials said.

Though the dialogue was not a forum to discuss the ballooning trade gap, one of the officials said the subject could come up in the discussions. The two sides are also expected to sign preliminary pacts to cement cooperation, the official said, requesting anonymity.

The talks follow the meeting last week between Prime Minister Manmohan Singh and outgoing Chinese Premier Wen Jiabao in the Cambodian capital Phnom Penh, during which Singh had sought increased Chinese investment into India.

The Indian side to the dialogue will be headed by Planning Commission deputy chairman Montek Singh Ahluwalia, while the Chinese side will be led by Zhang Ping, chairman of the National Development and Reform Commission (NDRC).

The Chinese delegation is expected to include four deputy ministers, NDRC officials and a large delegation of industrialists.

The Indian delegation will include officials of the foreign, finance, commerce and railways ministries, another official cited above said on Sunday. He, too, declined to be named.

India is only the second country after the US with which China holds such an exchange, the idea for which emanated during Wen’s visit to India in December 2010.

The objective of the dialogue is to increase coordination on macroeconomic policies and to provide a platform for both the countries to leverage common interests and shared developmental experiences—a move that could be taken as a confidence building measure between the two countries, analysts say, to normalize ties after their 1962 conflict.

“It is a means to enhance confidence between the two countries to ensure closer coordination in their positions at fora like the BRICS (the fast growing developing countries Brazil, Russia, India, China and South Africa)," said Srikanth Kondapalli, a professor of Chinese Studies at the Jawaharlal Nehru University. “It aims to look at economic relations in the future. I would say the dialogue has made satisfactory progress in the past year and we have covered quite a bit of ground."

Recognized as two significant powers of Asia, India and China are also seen as strategic and economic rivals.

Both agreed “to stay committed to deepening bilateral investment cooperation, further opening markets, and improving the investment environment in India and China", the statement said.

One of the outcomes of the first dialogue was an agreement to explore cooperation in railways, and the two sides could see progress in this area in New Delhi this week with senior officials from China CNR Corp. Ltd, one of China’s biggest railway firms expected to be part of the delegation travelling to India.

Chinese foreign ministry spokesperson Hua Chunying was cited by the Xinhua news agency as saying that the focus of the dialogue this year was expected to be on “stepping up communication and coordination of macroeconomic policies and deepening and expanding mutually beneficial cooperation in investment, infrastructure, high technology, energy conservation and environmental protection".

Economic engagement between India and China “was given a great deal of importance" by Singh in a meeting with Wen last week, Indian foreign secretary Ranjan Mathai told reporters after the talks.

According to India’s ambassador to China, S. Jaishankar, China is India’s largest trade partner and India is China’s seventh largest export destination.

Trade in 2011-12 was $74 billion (around 4 trillion today) with the deficit at $27 billion—something that is worrying India.

In his talks with Wen, Singh “emphasized the need for greater market access for Indian exports, particularly in areas such as services, IT and pharmaceuticals," Mathai said, adding that India had also sought Chinese investment in infrastructure.

Biswajit Dhar, director general of the Delhi-based Research and Information System for Developing Countries think tank, said with India and China looking to increase cooperation at international fora, “irritants in bilateral trade like the trade gap need to be sorted out. The two cannot be seen completely separate".

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Published: 25 Nov 2012, 10:28 PM IST
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