India, China to deepen economic engagement

India and China have decided to add new content and substance to bilateral relationship and explore ''untapped opportunities'' as the two countries increase their economic engagement and intensify business and trade relations.

In their first meeting, external affairs minister Sushma Swaraj and Chinese foreign minister Wang Yi on Sunday decided to explore "untapped opportunities", including setting up of industrial parks in India to take annual bilateral trade beyond the current level of $65 billion.

The two leaders discussed ways of deepening engagement in specific sectors as well as projects and removing hurdles to spur trade.

"There was also a fairly long discussion on economic issues. These included specific projects, trajectory of economic ties, potential for tapping opportunities as well as the hurdles being faced in pursuing enhanced economic cooperation," an external affairs ministry spokesperson said.

Joint secretary in-charge of China in the external affairs ministry Gautam Bambawale said Swaraj talked about investment by Chinese firms through industrial parks while the Chinese side discussed the possibility of investment in diverse areas in India.

China is India's biggest trading partner with two-way trade close to $65 billion, but with a huge trade surplus in favour of China of about $40 billion.

Bilateral trade between the two countries saw a slight decline of 1.5 per cent for a consecutive year in 2013, but this has not helped narrow India's trade deficit as the decline in trade was more due to lower Chinese imports of iron ore from India.

India has consistently been seeking greater market access in China, especially in areas such as IT-enabled services, cotton textiles and home furnishings as also pharmaceuticals, in a bid to reduce the bulging trade deficit, but without any result so far.

China, however, has been evasive on specific issues, and, according to the MEA spokesperson, Wang merely told Swaraj that China welcomed India's development and was ready to engage with the new government.

The talks, however, were cordial and comprehensive, covering all important issues, substantive and productive.

China is a neighbour with which India shares a long border and China is also a major economy with whom India's bilateral economic ties are of a significant magnitude.

Even while there was a determination to add new content and substance to the relationship, there was an understanding that respect for the sensitivities and aspirations of each other was an essential for expansion of bilateral relations.

There was also discussion on people to people exchanges – these included Kailash Mansarovar, the project about the Encyclopaedia of India-China cultural contacts etc.

As two important countries with growing interests in the region and beyond, there were discussions on several issues where both India and China have interests.