Border peace, trade deficit, four-point plan, and Asia’s future: Decoding Modi–Xi’s Tianjin talks

The leaders agreed that “differences should not be allowed to be turned into disputes.”

Prime Minister Narendra Modi opened his visit to Tianjin for the Shanghai Cooperation Organisation (SCO) Summit with a bilateral meeting with Chinese President Xi Jinping, their second in less than a year after Kazan in October 2024.

Foreign Secretary Vikram Misri briefed reporters, noting that both leaders “were happy to note the progress that had been registered, the actions that had been taken since the meeting in Kazan and the momentum that had been maintained in bilateral relations, especially in the domain of people-to-people relations.”

The border issue figured prominently. Modi underlined that 'peace and tranquility in the border areas' is essential for the smooth development of ties. Both leaders took note of last year’s disengagement and agreed to avoid disturbances going forward.

Misri explained, “Dedicated mechanisms have been created for taking these talks forward. We expect that the existing mechanisms… will meet in the coming days and weeks and the respective leaders of this mechanism from the two sides will come to an understanding on how these mechanisms for the delimitation-related talks are going to go forward.”

Misri said the tone was clear: “They both agreed that the two countries were primarily focused on their domestic development goals, and in this, they were partners rather than rivals.”

He added, “It was also an element of consensus between them that a stable and amicable relationship between India and China can be to the benefit of the 2.8 billion people who live in the two countries. The common interests of the two countries outweigh their differences and the two leaders also shared a consensus on the fact that differences should not be allowed to be turned into disputes.”

President Xi laid out a structured four-point plan to upgrade ties:

• Strengthen strategic communication and deepen mutual trust
• Expand exchanges and cooperation
• Achieve mutual benefit and win-win results while accommodating each other’s concerns
• Strengthen multilateral cooperation to safeguard common interests

“All of these were responded to positively by Prime Minister Modi,” Misri said.

Economic ties were another focal point. Misri said, “On economic and trade relations, there was recognition of the role that the Indian and the Chinese economies can play in stabilising world trade. Both leaders underlined the need, once again, to proceed from a political and strategic direction to reduce their bilateral trade deficit, facilitate bilateral trade and investment ties in both directions, and increase policy transparency and predictability.”

Acknowledging the imbalance, he added, “Yes, it is a fact that there is a large and ongoing trade deficit between India and China. This has been a matter of discussion over several years… Growing trade between the two countries and narrowing of the deficit will contribute to a change in perception in the relationship as well.”

The discussion went beyond bilateral matters. Misri said, “There was also a discussion on regional and global issues and challenges, including with regard to multilateral platforms. Prime Minister expressed support for China’s ongoing presidency of the SCO and the summit in Tianjin. He also invited President Xi to the BRICS Summit that India will be hosting in 2026. President Xi thanked Prime Minister for the invitation and offered China’s full support to India’s BRICS presidency.”

Modi also had a separate meeting with Cai Qi, member of the CCP Politburo Standing Committee. Misri revealed, “There was originally a proposal from the Chinese side for Mr Cai to host a banquet for the Prime Minister on behalf of President Xi Jinping. This was meant as a special gesture to show the importance attached by China to the visit of the Prime Minister, which was taking place after a hiatus of nearly seven years.”

Due to scheduling conflicts, the banquet became a brief meeting. Modi “shared his overall vision for the India-China relationship with Mr Cai and sought his involvement and his role to realise the consensus of the two leaders. Mr Cai, for his part, reiterated the Chinese side’s desire to expand bilateral exchanges in various fields, to address our respective concerns in economic areas and to further improve relations.”

The SCO sessions begin tomorrow. Modi is slated to address the plenary, where “he will outline India’s approach to fostering regional cooperation under the SCO umbrella,” Misri said.

“After this engagement, he is scheduled to have a bilateral meeting with President Vladimir Putin of Russia, following which he will depart for India.”