At the end of the first ever two-day informal summit meeting of the Chinese President Xi Jinping and the Indian Prime Minister Narendra Modi in Wuhan on Saturday, the two leaders agreed to respect the interests and concerns of each other’s countries and cooperate in multifarious ways for the common good.

A press release of the Indian Ministry of External Affairs issued at the end of the summit said that the informal interactions at the highest level had helped the two countries forge a “common understanding of the future direction of India-China relations which is to be built upon mutual respect for each other's developmental aspirations and prudent management of differences with mutual sensitivity.”

The release said that the two leaders believe that the simultaneous emergence of India and China as two large economies and major powers with strategic and decisional autonomy, has implications of regional and global significance.

They shared the view that peaceful, stable and balanced relations between India and China will be a “positive factor for stability amidst current global uncertainties.”

They also agreed that proper management of the bilateral relationship will be conducive for the development and prosperity of the region, and will create the conditions for the “Asian Century.”

To this end, they decided to strengthen the “Closer Development Partnership” in a mutually beneficial and sustainable manner, in pursuit of national modernization and greater prosperity for their peoples.

Towards Peace on Border

Prime Minister Modi and President Xi reviewed developments in India-China relations from the strategic and long-term perspective.

They agreed to “significantly enhance” efforts to build on the convergences through the established mechanisms in order to create the “broadest possible platform for the future relationship.”

They also agreed that both sides have the maturity and wisdom to handle the differences through peaceful discussion within the context of the overall relationship, bearing in mind the importance of respecting each other's sensitivities, concerns and aspirations.

Ensuring Peace on Border

The two leaders expressed their support for the work of the Special Representatives on the India China Boundary Question and urged them to intensify their efforts to seek a fair, reasonable and mutually acceptable settlement.

Modi and Xi underscored the importance of maintaining peace and tranquility in all areas of the India-China border region in the larger interest of the overall development of bilateral relations.

To this end, they issued strategic guidance to their respective militaries to strengthen communication in order to build trust and mutual understanding and enhance predictability and effectiveness in the management of border affairs.

The two leaders further directed their militaries to earnestly implement various confidence building measures agreed upon between the two sides, including the principle of mutual and equal security, and strengthen existing institutional arrangements and information sharing mechanisms to prevent incidents in border regions.

Trade and Investment

The President of China and the Prime Minister of India agreed to push forward bilateral trade and investment in a balanced and sustainable manner by taking advantage of complementarities between their two economies.

They also discussed ways to promote greater cultural and people-to-people exchanges and agreed to explore establishing new mechanisms in this direction.

Improving Strategic Communication

Prime Minister Modi and President Xi underlined that, as two major countries, India and China have wider and overlapping regional and global interests.

They agreed on their need to strengthen strategic communication through greater consultation on all matters of common interest.

They believe that such strategic communication will have a positive influence on enhancing mutual understanding and will contribute to regional and global stability.

The two leaders agreed that India and China have separately made major contributions to global peace and prosperity through their respective growth and economic development, and would continue to act as engines for global growth in the future.

Towards New Economic Order

They reiterated the importance of building an open, multipolar, pluralist and participatory global economic order which will enable all countries to pursue their development and contribute to the elimination of poverty and inequality in all regions of the world.

They spoke of their respective efforts to contribute to the regional and global economic development.

Facing Global Challenges Together

The two leaders also shared views on their respective foreign policy visions of achieving global prosperity and security. They agreed to jointly contribute in a positive and constructive way in facilitating sustainable solutions for global challenges including climate change, sustainable development, food security and so on.

They underscored the importance of reform of multilateral financial and political institutions to make them representative and responsive to the needs of developing countries.

The two leaders agreed that as two major countries and emerging economies, India and China, given their vast developmental experiences and national capacities, should join hands to take lead in offering innovative and sustainable solutions to challenges faced by humankind in the 21st century.

These include combating diseases, coordinating action for disaster risk reduction and mitigation, addressing climate change and ushering digital empowerment.

They agreed to pool together their expertise and resources in these areas and create a global network dedicated to these challenges for the larger benefit of humanity.

Facing Terrorist Threat

Prime Minister Modi and President Xi recognized the common threat posed by terrorism, and reiterated their strong condemnation of and resolute opposition to terrorism in all its forms and manifestations. They committed themselves to cooperate on counter-terrorism.

The two leaders highly assessed the opportunity for direct, free and candid exchange of views offered by the Informal Summit and agreed on the utility of holding more such dialogues in the future.

The forward-looking dialogue raised the level of strategic communication about the perspective, priorities and vision that guide their respective policy choices domestically, regionally and globally.

It also helped them in forging a common understanding of the future direction of India-China relations built upon mutual respect for each other's developmental aspirations and prudent management of differences with mutual sensitivity.

The main aim of the Modi-Xi informal meeting stretched over two days, was not to arrive at any concrete proposals on any matter, whether political, economic or strategic, but to draw up the basic framework for the relationship.

In so far as the latter objective is concerned, an understanding on a healthy, realistic and sustainable framework has been reached.

It is now for the leadership of India and China to give muscle, substance and thrust to the implementation of the basic action plan.

For instance, there should be concrete action on reducing the gargantuan trade deficit which India has with China, its single largest trading partner. The deficit with China is a whopping 45% of India’s overall trade deficit.

China would have to be more accommodative towards India in trade matters.

On its part, India should shed its strategic paranoia about allowing China to step up investments in India. Such investments would reduce the economic imbalance and open to the doors to the participation of Indian industries in global value chains.

China would have to be more sensitive to India’s sensibilities in regard to the status of Arunachal Pradesh (which China refers to as Southern Tibet and therefore part of Tibet) and to CPEC’s passing through a disputed part of Kashmir.

And India, on its part, should be sensitive to China’s sensitivities about the status of Tibet and rein in Bharatiya Janata Party Ministers and party leaders who tend to proclaim that Tibet will one day gain independence from China.

Since China has an authoritarian structure, decisions taken at the top are followed in letter and spirit and quickly by functionaries at all levels. But the same thing cannot be said about India because it is a democracy and its bureaucracy is not as tightly controlled and efficient as China’s.

Prime Minister Modi, thus, has the challenging task to see that the pledges he had made and the understandings he had entered into with Xi at Wuhan are implemented both in letter and spirit and fast too to cover the current trust deficit about Indian systems on the Chinese side.

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