Chinese President Xi Jinping is set to visit New Delhi for the annual BRICS summit, marking his first trip to India in seven years. This visit could help improve diplomatic relations between China and India, but analysts note that business ties remain strained due to regulations, visa delays, and restrictions on industrial equipment. There is uncertainty about whether Xi will meet Indian Prime Minister Narendra Modi, which would be important for the future of their relationship.
Historically, China and India have had a cautious relationship, especially after a 1962 war and a 2020 border clash that left several soldiers dead. Despite recent improvements, such as Modi’s visit to China, experts suggest that trust issues persist, and significant progress may not be forthcoming. There have been efforts by India to ease restrictions on Chinese investments, particularly in electronics and solar energy, but not enough to attract major companies like BYD and Great Wall Motor, which have paused investments in India due to increased scrutiny.
Chinese companies are also facing scrutiny from their government regarding investments in India, especially in high-tech sectors. Both Xi and Modi have expressed a desire for partnership rather than competition, but India’s foreign ministries did not comment on the current situation. India recently rejected a proposal from China’s Alipay for integration into its payment system due to security concerns and is considering investigating Xiaomi for possible irregularities.
While India and China have resumed direct flights and eased some visa processes, Indian businesspeople have reported difficulties in getting visas. Additionally, important equipment and components from China for Indian projects have been delayed at customs, reflecting a broader issue of trade dependency that could be leveraged by China.
An Indian think tank official suggested that these delays go beyond administration issues and indicate that China may be using trade as a tool. However, a successful meeting between Xi and Modi could help resolve some of these concerns. Any discussions between the leaders offer a chance to better align their economic and political goals, potentially opening pathways for improved commercial ties that benefit both nations.
With information from Reuters
