Indian and Chinese companies signed agreements on Monday worth billions of dollars as the two emerging market giants sought to broaden commercial ties despite political tensions. The deals inked in New Delhi during the countries' second strategic economic dialogue included plans for investments in clean energy, infrastructure, electric power, steel and other projects.
"We must aim at a magnitude and intensity of (economic) engagement appropriate for the world's two most populous nations," said Montek Singh Ahluwalia, one of India's most powerful government figures who led the Indian side at the talks. "It is only through larger mutual investments that we can take the India-China economic co-operation to a higher level," Ahluwalia, deputy chairman of India's economic planning commission, told reporters. The agreements included a plan to develop renewable energy projects envisaging an investment of $3 billion by India's Reliance Power and China's Ming Yang Wind Power Group, a leading wind turbine manufacturer.
India's debt-laden Lanco Infratech said the state-run China Development Bank would arrange $2 billion worth of loans for its two power projects. Territorial disputes, Beijing's role as arms supplier to Indian rival Pakistan and the presence in India of Tibet's spiritual leader, the Dalai Lama, all fuel an atmosphere of mutual political suspicion.
At the same time, India and China are major trading partners with bilateral trade totalling $75 billion with the two countries targeting a goal of $100 billion by 2015. Ahluwalia said the latest tiff between the neighbours over a map issued by Beijing on its new passports claiming disputed territory did not come up in the talks.
At the government-to-government level, India signed an agreement with China to explore co-operation in modernising the dilapidated, more than century-old Indian railway system. There was no immediate comment from the Chinese side but Ahluwalia said the view "emanating from the Chinese side is that they would also like a deepening of economic co-operation". He said the large Chinese delegation, which had 180 members, indicated "how serious they are" about improving economic ties. The economic dialogue emerged from a visit by outgoing Chinese Premier Wen Jiabao to India in December 2010.