China, India say growing ties could 'change face of Asia, even the world'

McClatchy NewspapersJanuary 14, 2008 

BEIJING — Leaders of the world's two fastest growing major economies, China and India, set out sweeping goals Monday to build trade and put behind them decades of hostility and mistrust.

The two nations, whose populations constitute a third of humanity, declared that their growing ties wouldn't put at risk either country's own alliances, an apparent reference to warming U.S.-Indian relations.

Indian Prime Minister Manmohan Singh and Premier Wen Jiabao of China, after unusually lengthy talks, emerged to say that the two nations would conduct new joint military exercises this year, designed to ease frictions along their once-tense border.

While the two leaders apparently made no headway in ending the Himalayan border dispute, which sparked a border war in 1962, they signed an unusual six-page accord affirming support for free trade, cooperation in civilian nuclear energy programs, joint efforts to combat climate change and a panoply of other issues.

Wen praised the "sound momentum" of relations and said that Beijing and New Delhi should "trust each other and work with each other for mutual benefit and win-win progress. We should not ask who will outdo whom."

Aides to Singh and Wen were effusive in casting the talks as a watershed.

"Premier Wen said common development of China and India would change the face of Asia and even the world," Chinese Foreign Ministry spokesman Qin Gang said.

Singh's foreign secretary, Shivshankar Menon, said the Indian leader had been "received with great warmth" and paraphrased a Singh statement from the meetings: "The rise of India and the rise of China is a global public good. It's good for us; it's good for the region. It's also good for the world. It helps the world economy."

Trade between India and China began to surge only in 2005 when the two nations established what they called a "strategic partnership." The two sides planned to reach $20 billion in bilateral trade by 2008, a target reached in 2006. A new target was set for 2010 but was almost met last year when trade soared nearly 50 percent to $38.6 billion.

"We have decided to increase our bilateral trade target from $40 billion by the year 2010 to $60 billion," Singh said in a statement.

Earlier in the day, Singh told a business forum that trade is driving bilateral relations, a sign that business has moved faster than bureaucracy.

"This makes me wonder whether our two governments have been underestimating the capabilities of our respective industries and their strong urge to do business with each other," Singh said.

China's economy is growing at double-digit rates, and India has posted nearly 9 percent growth for the past three years.

But trade has tilted in favor of China, which posted a $9 billion surplus last year.

Indian Commerce Minister Kamal Nath told the Press Trust of India that his Chinese counterpart "clearly recognized that such a large trade imbalance is not desirable and sustainable. He offered to send buying missions to India frequently to promote a more diversified basket of exports from India to China."

India is seeking permission for its private airlines to fly directly to China and pick up passengers for onward flights to the United States and other countries.

For its part, China complains of barriers to direct investment in India.

India appeared to win Chinese support for its status as a nuclear power, gaining a pledge from China "to promote bilateral cooperation in civil nuclear energy."

The border issue remains a festering matter. China still claims much of India's vast northeastern state of Arunachal Pradesh, which it says is part of Tibet.

An opinion column Monday in the English-language China Daily paper rejected frequent Indian charges that Chinese soldiers stray over the border.

"There is no historical record showing a physical borderline that both countries recognize. How can you invade a foreign land that does not exist?" it said.

(McClatchy special correspondent Fan Di contributed to this report.)

McClatchy Newspapers 2008

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