India-China Chennai Connect: Bridging trade deficit & enhancing strategic trust

MAMALLAPURAM: The second informal India-China summit ended in the seaside resort town of Mamallapuram with a resonant reaffirmation of the Wuhan spirit of “managing differences prudently” and enlarging areas of cooperation across the spectrum, including economic, strategic and cultural.

The major takeaway from the summit, which entailed over seven hours of one-on-one discussions between Prime Minister Narendra Modi and Chinese President Xi Jinping, was the setting up of an elevated mechanism to reduce trade deficit and enhance trade in goods, services and investment.

The mechanism, to be chaired by India’s Finance Minister Nirmala Sitharaman and China’s Vice Premier Liu He, underscored the emphasis by both sides to broaden the economic partnership, with China agreeing to open markets for Indian companies in IT and pharma sectors.

“In pursuit of their efforts to further deepen economic cooperation and to enhance their closer development partnership, the two Leaders have decided to establish a High-Level Economic and Trade Dialogue mechanism with the objective of achieving enhanced trade and commercial relations, as well as to better balance the trade between the two countries,” said a statement by India’s Ministry of External Affairs.

Briefing after the summit, Foreign Secretary Vijay Gokhale said that the two sides have agreed to encourage mutual investments in identified sectors through the development of a Manufacturing Partnership and flesh out its contours at the first meeting of the mechanism.

Another important outcome of the second summit was the deepening and consolidation of strategic communication so that mistrust can be averted on issues of core interest to both countries. In this regard, Xi Jinping stressed on enhancing security and military-to-military cooperation. The Chinese side invited India’s Defence Minister Rajnath Singh to visit China later this year.

Building on the Wuhan summit, which led to the setting up of High-level India-China People-to-People and Cultural Exchanges Mechanism, the Chennai summit provided a fresh momentum to positioning people at the heart of this burgeoning partnership. The two leaders agreed that public opinion should be rallied to broad-base the relationship. In this context the two sides decided to hold 35 events each in their respective countries to mark the 70^th anniversary of the establishment of diplomatic relations between the two countries. “The two leaders have decided to designate 2020 as Year of India-China Cultural and People to People Exchanges and agreed that the 70th anniversary of the establishment of India-China relations in 2020 will be fully utilized to deepen exchanges at all levels including between their respective legislatures, political parties, cultural and youth organizations and militaries,” said the statement by India’s Foreign Office. “To celebrate the 70th anniversary of diplomatic relations the two countries will organize 70 activities including a conference on a ship voyage that will trace the historical connect between the two civilizations.”

Looking ahead, the two rising Asian powers are set to enhance their collaboration on combating the twin scourge of terrorism and radicalization, and enlarge their cooperation on a broad spectrum of cross-cutting issues such as climate change and sustainable development.

The second informal summit, as Prime Minister Modi said, has set the stage for ushering in “a new phase in India-China relations” and underscored the role of direct interaction between the leaders in steering multi-faceted India-China relations onto a higher trajectory.

“We will be sensitive to each other’s concerns. India-China relations will be an anchor of peace and stability in region and the world,” he said.

Xi Jinping, the most powerful Chinese leader in decades, stressed that the format of the informal summit will continue in the future as well. “We will continue this informal interaction. We have made the right decision to have informal interaction,” he said.

Author Profile

Manish Chand

Manish Chand is Founder-CEO and Editor-in-Chief of India Writes Network (www.indiawrites.org) and India and World, a pioneering magazine focused on international affairs. He is CEO/Director of TGII Media Private Limited, an India-based media, publishing, research and consultancy company.