India, China in talks to resume border trade after five years

India and China are discussing the resumption of border trade in locally made goods after more than five years, officials in New Delhi familiar with the matter said, in the latest effort to ease long-standing tensions between the two Asian neighbours.

Both countries have proposed restarting trade through designated points along their 3,488-kilometre Himalayan border, though discussions remain confidential, Caliber.Az reports, citing foreign media.

On August 14, China’s Ministry of Foreign Affairs said that Beijing was “willing to step up communication and coordination with India” and highlighted the importance of border trade in supporting local communities. India’s Ministry of External Affairs has not commented publicly.

For over three decades, the countries traded items such as spices, carpets, wooden furniture, cattle fodder, pottery, medicinal plants, electronic goods, and wool through three border points.

Trade was modest, estimated at $3.16 million in 2017–18, but came to a halt during the Covid-19 pandemic and after deadly border clashes in 2020 that left 20 Indian soldiers and at least four Chinese troops dead.

The potential restart comes as bilateral relations show signs of improvement. Direct flight services between India and China are expected to resume next month, and Beijing has eased restrictions on some fertiliser shipments to India.

Prime Minister Narendra Modi is also scheduled to visit China in August for a Shanghai Cooperation Organisation summit and to meet President Xi Jinping on the sidelines.

The warming ties contrast with New Delhi’s strained relations with US President Donald Trump, who has imposed a 50% tariff on Indian exports to the US, significantly higher than those applied to regional peers.

By Aghakazim Guliyev