WASHINGTON, Dec. 31 (UPI) -- Asia's two fastest-growing economies -- India and China -- set aside mutual suspicion, at least temporarily, and came closer in 2003 with improved diplomatic, defense and economic ties.
The highlight of the year was a visit to Beijing by Indian Prime Minister Atal Bihari Vajpayee in June, and a trip last month to India Jia Qinglin, chairman of the National Committee of the Chinese People's Political Consultative Conference, China's top decision-making body.
"The visit has been a small step forward in the long march forward in Indo-China rapprochement," John Garver, a professor at the Sam Nunn School of International Affairs at the Georgia Institute Of Technology, told United Press International at the time of the Vajpayee visit.
The visit was the first by an Indian leader to China in a decade, and though the agreements signed were symbolic, analysts said the benefits would likely manifest themselves in the long run.
"In the long term, there is some benefit ... We have to have a constructive relationship with our neighbor," S. Chandrasekhar, director of the South Asia Analysis Group, a think tank near New Delhi, told UPI at the time.
Ties between the world's two most populous countries have been traditionally frosty. Each country regards the other as a rival for regional dominance. They fought a brief, but bitter border war in 1962, resulting in a heavy Indian defeat and loss of territory, which is still disputed.
Vajpayee's trip also moved Indo-China ties beyond the realm of Pakistan, which is India's rival and Beijing's ally. New Delhi has traditionally balked at Beijing's close ties with Islamabad and its suspected transfer of technology that allowed Pakistan to acquire nuclear and missile know-how.
Vajpayee's trip came at a crucial time. He was the first leader of a major nation to visit China while it was still under risk from severe acute respiratory syndrome, the flu-like disease the killed more than 1,000 people worldwide. The timing was meant to show the great emphasis India placed on its relationship with China.
Also, Washington is believed to be moving closer toward New Delhi in a bid to fend off Chinese competition in Asia and there has even been talk of an Asian NATO that includes the United States, India and other democracies. The plan comes a few years after Moscow proposed a similar axis involving Russia, China and India. Vajpayee's trip to China may be one way for India to keep its options open.
The trip had two major thrusts -- diplomatic and economic.
Diplomatically India was able to get China to concede, though implicitly, that Sikkim, the Himalayan kingdom annexed by New Delhi in 1975, was part of India. Chinese maps show the northeastern state an independent country.
On the other hand, China was happy because India accepted its sovereignty over Tibet. The region has been a bone of contention between the two sides because after the communists invaded it, the Dalai Lama, Tibet's spiritual leader, and his followers fled in 1959 to India where they still live.
The bulk of the border dispute still remains unresolved, however. The two countries agreed to work together to maintain peace in border areas until an "ultimate solution" is reached. They each appointed a top official as the point person on the dispute.
The two sides contest a 2,800-mile border in Kashmir and on the northeastern states of Arunachal Pradesh and Sikkim. They have been unable, despite talks that began in 1988, to delineate a Line of Actual Control.
In other deals during the trip, the two sides also agreed to conduct regular high-level exchanges, including between their armed forces, and annual foreign-minister level meetings.
As part of this, a high-level Indian military delegation visited China and inspected bases throughout the country, including Tibet.
They also held the first-ever joint naval exercises in November off Shanghai in which frontline warships of the two navies and aircraft and helicopters took part.
An Indian naval spokesman called the exercises a "stepping stone in enhancing inter-operability between the two navies."
Economically, the two sides also vowed to enhance economic ties and cooperation within the World Trade Organization.
They agreed to double bilateral trade to $$@$!10 billion by 2005. Trade has been growing. It reached $$@$!4.95 billion last year, up 37.6 percent from a year ago. From January to May this year, trade grew 70 percent to $$@$!2.9 billion.
In 2002, 71 Indian companies had invested in China and 15 Chinese firms had invested south of the border. Both sides recognize there is room for growth. China wants to sell its textiles to India's vast market, and India sees the 2008 Beijing Olympics as a major investment opportunity.
India also wants to use its information technology sector to make inroads into what it regards as an untapped market. Several IT firms, including the top four software manufacturers and exporters in India have begun operations in Shanghai, and many of the U.S. contracts being awarded to Indian IT companies are being outsourced by India to China.
The next year is likely to be focus on the same issues, giving a new dimension to Sino-Indian relations, moving it away from traditional distrust of regional ambitions.
