Agencies/New Delhi
Indian and Chinese companies signed agreements yesterday worth billions of dollars as the two emerging market giants sought to broaden commercial ties despite political tensions.
The deals inked in New Delhi during the countries’ second strategic economic dialogue included plans for investments in clean energy, infrastructure, electric power, steel and other projects.
“We must aim at a magnitude and intensity of (economic) engagement appropriate for the world’s two most populous nations,” said Montek Singh Ahluwalia, deputy chairman of the Planning Commission who led the Indian side at the talks.
“It is only through larger mutual investments that we can take the India-China economic co-operation to a higher level,” Ahluwalia told reporters.
The agreements included a plan to develop renewable energy projects envisaging an investment of $3bn by Reliance Power and China’s Ming Yang Wind Power Group, a leading wind turbine manufacturer.
India’s debt-laden Lanco Infratech said the state-run China Development Bank would arrange $2bn worth of loans for its two power projects.
Territorial disputes, Beijing’s role as arms supplier to Pakistan and the presence in India of Tibet’s spiritual leader, the Dalai Lama, all fuel an atmosphere of mutual political suspicion.
At the same time, India and China are major trading partners with bilateral trade totalling $75bn with the two countries targeting a goal of $100bn by 2015.
At the government-to-government level, India signed an agreement with China to explore co-operation in modernising the dilapidated, more than century-old Indian railway system.
There was no immediate comment from the Chinese side but Ahluwalia said the view “emanating from the Chinese side is that they would also like a deepening of economic co-operation.”
He said the large Chinese delegation, which had 180 members, indicated “how serious they are” about improving economic ties.
Ahluwalia said the latest tiff between the neighbours over a map issued by Beijing on its new passports claiming disputed territory did not come up in the talks.
Also yesterday, National Security Adviser Shivshankar Menon downplayed the map row, saying that the issue will have to be seen in the context of the boundary negotiations and stressing that the two countries have made some progress in this area.
“I think you need to see these things in some perspective. We do have differences on where the boundary lies. We are discussing them. We have made progress in dealing with that,” Menon said about the recent controversy over China issuing e-passports which show Arunachal Pradesh and Aksai Chin as part of China.
Menon underlined that the Chinese documents show their version of the boundary, while Indian documents show “our version of the boundary,” indicating that the issue was a reflection of the unresolved boundary dispute with China.
“What has changed? Chinese have a view on where the boundary lies, which is why we are having discussions on the boundary because we have differences on where the boundary is,” he said.
“We are in the process of agreeing on a framework to settle the boundary and the next step, hopefully the third stage, is to actually agree on a boundary. Right now we are at the second stage,” Menon said.