India,China talks begin; trade,incursion in focus

This is being seen as a crucial move to attract Chinese investment.

Economic ties and the recent spate of Chinese incursions in Ladakh dominated the India-China Strategic Dialogue held between Foreign Secretary Sujatha Singh and visiting Chinese Vice Foreign Minister Liu Zhenmin in New Delhi Tuesday.

With Prime Minister Manmohan Singh likely to visit Russia and China between October 21 and 25,it was discussed that Beijing and New Delhi would work towards finalising a Memorandum of Understanding on a Chinese industrial park in Uttar Pradesh. This is being seen as a crucial move to attract Chinese investment.

UP is being pitched as a preferred option by the government and,according to sources,China has been in talks with the Centre and the UP government for a suitable destination there.

The two sides also discussed the recent spate of Chinese intrusions,which have escalated tension lately,especially after the face-off in Ladakh in April. Both officials took note of ways to maintain peace along the Line of Actual Control in the border areas.

The fifth round of the Strategic Dialogue,which has been resumed after nearly three years,also saw a discussion on enhancing understanding on the utilisation of trans-border river waters. But sources said a commitment on the Indian proposal to have a water commission or an inter-governmental dialogue to deal with water issues is not expected at the secretary level. Instead,India expects China to respond when Singh meets the Chinese leadership in October.

The meeting,which lasted three hours,also focused on ways to expand bilateral trade and investment. India,which hopes to increase export of cotton fabric to China,wants the duty on the fabric reduced from 10 to 5. The two sides also discussed the possibility of an increase in the export of buffalo meat the demand for which could be worth 1 billion per year to China.

The two sides also discussed future cooperation in the BRICS framework and ways to ensure an open,inclusive and transparent architecture in the Asia-Pacific region.

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Later,Liu called on External Affairs Minister Salman Khurshid,following which the MEA announced that the sixth India-China Strategic Dialogue will be held in Beijing at a mutually convenient time.