India-China relations, which deteriorated after the Galwan Valley conflict, have not yet returned to normal. Meanwhile, External Affairs Minister S Jaishankar said on Tuesday that India’s doors are not closed for trade with China, but it has to be decided in which areas and on what terms the two countries will trade with each other.
Let us tell you that relations between the two nuclear-armed Asian giants have been going bad since the deadly Galwan conflict in 2020. India has since tightened its scrutiny on investments by Chinese companies and halted major projects. However, government officials, including Finance Minister Nirmala Sitharaman, have recently supported suggestions to allow more Chinese investment in the country.
India can either integrate into China’s supply chain or promote foreign direct investment (FDI) from China to boost its global exports, according to the latest annual economic survey released in July.
“We are not closed to trade with China. It is the second largest economy in the world. It is a premium manufacturer. There is nobody who can say I will not trade with China. I think the issue is in which sectors do you trade and on which terms do you trade. It is much more complex than a black and white binary answer,” Jaishankar said during a conference in Berlin.
Jaishankar has spoken several times in recent months about the need to be cautious about trade and investment with China. In August, he said India had a “specific China problem”. Earlier in May, Jaishankar had said at the Confederation of Indian Industry’s (CII) annual business summit that Indian firms should evaluate business transactions with China through a “national security filter” amid the standoff at the LAC and source more from domestic manufacturers.
According to news agency Reuters, India may ease restrictions on Chinese investment in non-sensitive sectors such as solar panel and battery manufacturing. There is a lack of expertise in these areas. This hinders domestic manufacturing.
India has almost blocked investment scrutiny as well as visas for all Chinese nationals since 2020. However, it is now considering easing visa rules for Chinese technicians. The biggest reason for this is that it has disrupted billions of dollars of investment.