India, China to Resolve Trade and Economic Concerns

India, China to Resolve Trade and Economic Concerns

Why in the News ?

India and China have agreed to initiate functional dialogues to address trade and economic issues, including curbs on rare earth exports, as part of efforts to stabilise ties post the Ladakh military standoff. Talks were held in New Delhi.

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High-Level Diplomatic Engagement:

  • A meeting was held in New Delhi between Foreign Secretary Vikram Misri and Chinese Vice Foreign Minister Sun Weidong.
  • Both sides agreed to begin functional dialogues to resolve specific bilateral issues, particularly in trade and economic sectors.
  • The Chinese official also met with National Security Adviser Ajit Doval to enhance strategic dialogue.

Key Trade Concerns Raised

  • The Indian side flagged China’s export restrictions on rare earth minerals, vital for high-tech and renewable energy sectors.
  • China holds a near-monopoly on many rare earth elements, making India vulnerable to supply shocks.
  • These concerns were part of the broader attempt to address economic imbalances in bilateral trade.

Focus on Connectivity and Confidence-Building

  • Both countries agreed to expedite the resumption of direct air services, which were suspended in 2020 due to the pandemic and tensions.
  • The move is seen as a step towards rebuilding confidence and normalising ties after the Ladakh border face-off.
  • These dialogues reflect a shift toward diplomatic de-escalation while maintaining core national interests.