Thaindian News

Sanya (China), April 12 (IANS) Despite a frosty past, India says its relations with China have stabilised and hold a promise for the future as Prime Minister Manmohan Singh meets President Hu Jintao in this coastal Chinese city Wednesday to discuss bilateral and global issues.

“Relationship with China is stable. There is an opportunity to know how we can take it forward now,” a top government source told IANS.

Towards this, the source said, the two countries will soon resume high-level defence exchanges that were called off last year following a new flare-up in relations between the two Asian giants over visas.

India suspended defence exchanges, strongly objecting to China issuing a visa on a loose sheet to a top army commander because he was serving in Jammu and Kashmir. This was in continuance of China’s 2008 policy to issue stapled visas to Kashmiris, indicating that it recognizes the state as a disputed territory and its residents as non-Indians.

“The joint military exercises will be held,” the source told IANS Tuesday on condition of anonymity.

He said despite the flare-up, some defence contacts like flag meeting between border commanders were never stopped as the situation on the border with China “has been calm not only because it was winter but also because there has been less activity”.

“Things are going well. We are looking to take them forward.”

He said the two Asian powerhouses in recent times have been “consulting each other on various issues like what happened in West Asia and North Africa”, referring to turmoil in Egypt, Libya and other countries in these regions. India and China both objected to NATO-led military strikes to oust Libyan leader Muammar Gaddafi.

“It has major implications for both of us. We are both major energy importers. It will affect both of us. Both have big economic stakes in the stability of these regions,” said the source.

India-China ties have a past of mistrust, mainly because of their unresolved border dispute that also triggered a short war in 1962. The stapled visa issue added to the tension.

However, it seems that China has reversed its stapled visa policy as four Kashmir-born journalists, including one with passport issued in Srinagar, were given normal visas. The reporters are members of Manmohan Singh’s media delegation for the BRICS summit here.

The source said that the two sides have been “quietly working” to solve “many difficult issues” after Chinese Premier Wen Jiabao visited India in December last year and held talks with Manmohan Singh.

“The two leaders had at that stage tried to deal with the issues and also tried to see how we can carry the relationship forward on the economic front and also reduce the trade imbalance.”

Indian Commerce and Industry Minister Anand Sharma, accompanying the prime minister, told reporters on board the special aircraft to Sanya that trade imbalance tilted in favour of China was another area of concern.

“The matter is likely to be raised” when Manmohan Singh and Hu talk on the sidelines of the Brazil-Russia-India-China-South Africa (BRICS) summit, he said.

The trade imbalance in favour of China had gone up to $20 billion in the overall bilateral trade of nearly $60 billion in 2010. In 2009, this was about $16 billion.

Sharma said: “India has sought more access in Chinese markets so that the gap could be closed.”

He said the two countries have established a strategic economic dialogue for a larger economic relation. “We hope to have that dialogue in the next few months.”