China's Xi Jinping signs trade deal with India in state visit to Delhi


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China and India today signed a raft of trade deals and declared they would renew their efforts for peace on their disputed common border as reformist new Prime Minister Narendra Modi hosted Premier Xi Jinping on a state visit to India.

Among 12 deals, there is one which includes a £12.2bn five year investment by China into India’s infrastructure.

China will invest in India’s ageing railway system, set up industrial parks in Gujarat and Maharashtra and open its markets to more Indian exports like pharmaceucticals.

The state visit has been somewhat marred by a faceoff on the border which began on Wednesday, although reports today in the region suggested nearly 1000 Chinese soldiers had pulled back from reported incursions they had made into the Chumar region.

In their orchestrated statements to the media, the two sides acknowledged the need to settle their differences on the border.

According to the BBC, Mr Xi said: “China-India border issue is a problem which has troubled both sides for  long… As the area is uet to be demarcated, there may be some incidents.”


The reported withdrawal of the Chinese troops was taken as proof that the dispute was not enough to derail the continuing process of deepening trade relations.

For Mr Modi, the visit is likely to be seen as a success, adding to his visit to Japan. At the end of September, he will be visiting the US as he keeps on banging the drum for better trade and inward investment.

In his previous role as chief minister of Gujarat, where Mr Xi’s visit began yesterday, Mr Modi visited China on five occasions and has been a keen admirer of the country’s economic development.

Mr Modi tweeted: “I am glad that President Xi Jinping has come to India within months of our Government taking office”