India, China Strengthen Relations

Indian and Chinese leaders Monday agreed to create a "strategic partnership for peace and prosperity" between the two Asian giants, sealing their agreement with a set of accords aimed at ending a long-standing border dispute and boosting economic ties and trade.

After a round of extended talks between visiting Chinese Premier Wen Jiabao and his Indian counterpart, Manmohan Singh, the two sides announced their commitment to develop bilateral ties, saying India-China relations have "acquired a global and strategic character."

"The leaders of the two countries have therefore agreed to establish an India-China strategic and cooperative partnership for peace and prosperity," said a joint statement signed by the two leaders.

The partnership would promote diplomatic relations, economic ties and contribute to the two nations "jointly addressing global challenges and threats."

While the statement gave few details, it signaled a significant shift in relations between the neighbors, who together have one-third of the world's population, moving away from decades of mutual distrust and suspicion.

The agreement "signifies an upgradation in ties," Shyam Saran, India's foreign secretary told reporters later Monday, adding "India and China do not look at each other as adversaries, but as partners" in development.

However, "the partnership is not a military alliance nor is it directed against a third country," he said.

The two countries also agreed to a set of military confidence-building steps along their disputed border, referred to as the Line of Actual Control, including avoiding large-scale military exercises in the area and greater contacts between military officials posted at the border.

Monday's talks also resulted in a raft of agreements for cooperation in such diverse areas as civil aviation, finance, education, science and technology, tourism and cultural exchanges.

"This is an important visit. We are working to promote friendly ties of cooperation between our two countries," Chinese Premier Wen Jiabao told reporters earlier Monday after a ceremonial welcome by Singh at New Delhi's pink sandstone presidential palace.

"India and China can together reshape the world order," Singh said.

Wen's four-day visit comes as the world's two most populous countries seek to improve ties strained by a historic rivalry and an old border dispute.

The two countries agreed on a framework to resolve their long-standing boundary dispute and outlined a set of broad parameters to demarcate the boundary through a "fair, reasonable and mutually acceptable solution," the joint statement said.

An 11-point roadmap to settle the border dispute was finalized Sunday during negotiations between India's National Security Adviser M.K. Narayanan and China's Vice Foreign Minister Dai Bingguo, who headed the Chinese delegation.

India and China share a mountainous, 2,500-mile border, parts of which are not demarcated. The two sides went to war over the border disagreement in 1962.

The roadmap states that the countries would take into consideration historical factors, geographical features, people living in the area, security and whether the area was currently under Indian or Chinese control when marking the border.

Meanwhile, both sides have in recent years forged closer economic ties, hoping improved trade relations will also help expedite the resolution of political differences.

On Monday, the two leaders agreed to boost bilateral trade to $20 billion by 2008. Last year, trade totaled $13.6 billion, with India recording a trade surplus of $1.75 billion, according to data available with India's trade ministry.

Wen told business leaders later Monday that India and China should work for increased cooperation at multilateral forums such the World Trade Organization. Cooperation in these areas will be "to the benefit of our two countries and create a win-win situation for both," Wen said.

China is keen to develop a free trade area between the two countries. Their combined populations total 2 billion, which would make it the largest free trade area in the world. During their talks, Wen and Singh agreed Monday to set up a panel of experts to study the feasibility and benefits that would accrue from establishing such a trade area.

On Sunday, Wen visited the southern city of Bangalore, India's technology hub, and said the two nations should put aside their rivalry and pool their resources.

He said India and China can together lead the world in information technology, heralding a new "Asian century."

Saran said the issue of Tibet and the role of the Tibetan spiritual leader, the Dalai Lama, who lives in exile in India, did not figure in Monday's talks.

India allowed the Dalai Lama to set up a government in exile in the northern Himalayan town of Dharmsala after he fled Tibet in 1959 following an aborted uprising against Chinese rule in the territory.

In New Delhi, analysts said the strategic partnership between the two emerging giants would affect the balance of power both globally and in the region.

"It is an important development. It goes beyond the immediate bilateral relationship and has wider global and regional implications," said Sujit Dutta, a China expert at the state-run Institute for Defense Studies and Analyses.