India and China Sign Landmark Trade Deals
Two major world economic powers have come together in signing a landmark trade deal which could see both countries further solidify their positions as serious forces on the global stage.
India, one of the world’s fastest growing economies, welcomed the President of China, the world’s second largest economy, Xi Jinping for talks about trade, infrastructure and border disputes which have led to twelve agreements being signed in Delhi, one of which will see China investing $20bn in India’s infrastructure over the next five years.
China is one of India’s top trading partners and the importance of these deals is great as both are vying for greater influence on the world stage. These talks were somewhat hampered by recent border disputes between the two countries but a move towards a resolution has seemingly calmed both sides with an agreed focus on increasing co-operation in trade, space exploration and civil nuclear energy.
Deals agreed will see China invest heavily in India’s ageing railway system with high-speed links and up to date, upgraded railway systems. There will also be help in setting up Industrial parks in Gujarat and Maharashtra as well as China giving more prominence and access to Indian products, including pharmaceuticals and farm products.
Indian and Chinese companies have signed preliminary deals around these trade talks that are worth more than $3bn in aircraft leasing, telecoms and various other sectors. Despite the continuing tensions, trade between India and China has risen to almost $70bn (£43bn) a year although the trade deficit between India and China has also had a staggering growth, climbing to more than $40bn from $1bn in 2001-2002.
India’s Prime Minister, Narendra Modi, has urged that peace on the border is important to progress between the two countries saying that:
“true potential of our relations” would be realised when there was “peace in our relations and in the borders”.
China has echoed this sentiment with Mr Jinping commiting to peace and tranquillity on the border and saying:
“China-India border issue is a problem which has troubled both sides for long… As the area is yet to be demarcated, there may be some incidents,”
Whilst a Chinese Foreign Ministry Spokesman went on to say: “After timely, effective communication, the relevant situation has already been appropriately bought under control. Border issues are leftover issues from history.”
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