INDO- CHINA relations - Chinese Premier Li Keqiang visit to India

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Chinese Premier Li Keqiang, in the backdrop of Chinese incursion in Ladakh, recently visited India to ease border tensions, increase trade, and address rising trade imbalance. Though not much was achieved on strategic front, still bilateral ties moved forward with signing of number of agreements...

Achievements:

  • China agreed to provide more information about how its dams are affecting the flow of rivers that discharge into Indian territory. China’s dam building has been a source of contention.
  • Signing of $1 billion debt-for-fuel deal between China and Essar Energy PLC Lt, part of India's Essar group together with Smaller pacts which added a total $500 million in deals.
  • Agreed : to enhance cooperation in ways to use water efficiently for irrigation in agriculture, to improve facilities for pilgrims on the Kailash Mansarovar Yatra and to facilitate exports of buffalo meat to China and help redress the trade imbalance between the two countries.
  • The two countries proposed to set up an economic corridor along China, India, Myanmar and Bangladesh to spur regional economic integration.
  • Vowed to step up discussions to end their long-running border disputes.

Background:
India and China,the two largest countries of the world, account for 40 percent of the humanity and viewed as emerging superpower giving rise to the talks of Asian century. Though the relation between them is largely strained owing to -:
Indian Concern:

  • Agonizing memory of 1962 debacle in which India lost about 38000 sq km land to China.
  • Trust deficit due to intermittent border dispute and skirmishes, largely because of long undefined boundary.
  • "String of Pearls Policy" by which China aims to surround and contain India by building stronger influence in Nepal, Pakistan, Sri Lanka and Myanmar- posing a strategic concern for India
  • Ballooning trade deficit with China, India’s trade deficit to China reached $40 billion in the financial year ended March 2012.

Chinese Concern:
China is apprehensive about being encircled in an attempt to be contained by US and allies, thus making positive overtures to improve ties with India, so it remains neutral, doesn’t play into US hands.

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