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India, China Reset Ties: Agree on Border Peace, Flight Resumption, Kailash Pilgrimage Expansion and Trade Revival
Moneylife Digital Team 20 August 2025
Consumer Interest
Marking a major shift after years of strained ties, India and China on Tuesday announced a package of confidence-building measures aimed at creating a 'stable, cooperative and forward-looking' relationship. The decisions followed wide-ranging talks between Chinese foreign minister Wang Yi and India’s top leadership, including prime minister (PM) Narendra Modi, minister of external affairs S Jaishankar and national security adviser (NSA) Ajit Doval. According to a report from CNBC TV18, China agreed to lift restrictions on exports of rare earth magnets, fertilisers and tunnel boring machines to India. The visiting Chinese foreign minister assured Mr Jaishankar that India’s concerns on import restrictions are being addressed.
 
The fresh roadmap covers sensitive areas such as border management, people-to-people exchanges and trade revival. Direct flight connectivity between the two countries — suspended since the COVID-19 outbreak — will be resumed at the earliest, with an updated air services agreement in the pipeline.
 
Both sides agreed to intensify efforts to maintain peace along the contested frontier which has been tense since the Galwan clash of 2020. A new expert group will be set up under the working mechanism for consultation and coordination on border affairs (WMCC) to advance boundary delimitation talks. Additional mechanisms are planned in the eastern and middle sectors, complementing the existing framework in the western sector.
 
During the 24th round of special representatives’ talks, Wang Yi and Ajit Doval stressed that tranquillity on the border is essential to the overall development of bilateral ties. The ministry of external affairs (MEA) says discussions were positive and acknowledged progress on implementing the past consensus between the two countries’ leaders.
 
PM Modi reiterated that stable and constructive ties between India and China are vital for regional and global peace. He underscored the importance of maintaining calm along the line of actual control (LAC) and reaffirmed India’s commitment to a fair and mutually acceptable settlement of the boundary issue.
 
Wang Yi handed over a message from Chinese president Xi Jinping, along with an invitation to the Shanghai Cooperation Organisation (SCO) summit in Tianjin later this month. PM Modi will travel to China on 31st August –1st September 2025 for the meeting, his first visit in more than seven years.
 
Economic cooperation also figured prominently in the announcements. India and China agreed to reopen border trade through the designated points at Lipulekh Pass, Shipki La and Nathu La. Both sides say they would take steps to facilitate investment flows and promote trade links.
 
In a move welcomed by Indian pilgrims, Beijing and New Delhi agreed to expand the scale of the Kailash Mansarovar pilgrimage starting in 2026. Visa facilitation for tourists, businesspersons, journalists and other visitors will also be improved.
 
Direct flights between the two countries, halted since the pandemic and long delayed due to earlier tensions, will be restored soon. Officials said the two sides would finalise an updated aviation agreement to enable this.
 
India raised concerns about China’s hydropower projects on the Yarlung Zangbo river in Tibet, which flows downstream as the Brahmaputra. New Delhi sought transparency on projects with potential cross-border impact. Beijing assured that it would continue sharing emergency hydrological data on humanitarian grounds and agreed to engage through an expert-level mechanism on rivers.
 
 
The latest outreach comes at a time of turbulence in India-US relations after president Donald Trump imposed steep tariffs on Indian exports and penalised India over its crude oil purchases from Russia. The recalibration of ties with China is being seen as part of New Delhi’s effort to broaden strategic options.
 
Wang Yi, in his meetings, highlighted that maintaining stable and healthy bilateral relations was in the fundamental interests of both nations. He emphasised dialogue, mutual trust and broader cooperation as the way forward.
 
India and China have agreed to support each other’s diplomatic initiatives, including India’s hosting of the BRICS Summit in 2026 and China’s hosting in 2027. The SCO Summit in Tianjin, later this month, is expected to be a major test of the new momentum.
 
While the road to normalisation remains challenging after years of mistrust and military stand-offs, both sides have signalled that they are ready to recalibrate ties and seek solutions to long-standing disputes, while keeping economic and cultural links in focus.
Comments
deepak.narain
8 months ago
China is a hard nut to crack. All efforts for normalisation come to India at an extra cost and depend on China's convenience. Wish India also had progressed like China.
Reply
karan.r.gandhi
8 months ago
It hasn’t been even 4 months since China was supporting Pakistan during Operation Sindoor and we’ve already had a reset of ties with China.

Seems like Trump put India in a tight corner.
Reply
badhri9984
8 months ago
China helped Pakistan during Sindoor operations. India punished Turkey whereas Modi regime compromise with China double standards on terrorism. With Chinese products and services indian corporates. Requesting Chinese authorities for urea fertilizer to meet shortages and rare Earth minerals for your Indian corporates to make huge money to fund them during election campaign. Quid pro quo policy
Reply
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