China, India sign air pact; forge tie-ups

In a step to improve direct air connectivity, India and China on Monday signed a liberal civil aviation agreement that would allow a designated airline from either side to mount at least 21 flights in a week to any six points. Chinese and Indian firms have also signed deals worth $1 billion.

Private airlines like Jet Airways and Air Sahara can now operate to China, so can Air China, which has been waiting in the wings for a long time. So far, Air India and China Eastern operated only three and four flights a week, respectively. Chinese Premier Wen Jiabao said the two countries had agreed on a joint feasibility study for a bilateral free-trade agreement, besides agreeing to work together on energy security and at multilateral fora like the WTO.

Jiabao also expressed Chinese interest in investing in biotech, computer telecom hardware. Both sides thought that though there was an element of competition in the economic field, there were also several complimentary areas. In this connection, the two countries agreed to set up a ministerial-level joint economic group. On energy, it was agreed that the two will ensure there is no negative competition between companies. He also underlined the need to have better co-ordination in IT, where Indian prowess in software can be linked with Chinese hardware tech expertise.