By Sudhir Anand
Opinion | September 12, 2026
Border stability, fairer trade and dependable business access will determine whether diplomatic warmth becomes a lasting partnership.
India and China have strong reasons to improve their relationship. Their September 12 meeting in New Delhi put border peace, business mobility, supply chains and trade imbalances on the agenda. These are the right priorities. The challenge is turning diplomatic agreement into conditions that soldiers, manufacturers and traders can depend upon. Prime Minister’s Office statement
My concern is that political warmth can advance faster than trust. India needs confidence that territorial tensions will not repeatedly undermine cooperation, and that its businesses will receive meaningful opportunities in the Chinese market. Beijing must demonstrate that Indian interests deserve the same consideration it expects for its own.
A comparison of the two governments’ accounts reveals a difference in emphasis. India describes border peace as an essential foundation for developing the relationship. China advocates parallel progress in bilateral relations and resolving the boundary question. Both approaches allow cooperation, but they leave a practical question: how much normalisation should proceed while security concerns remain unresolved? Indian account, Chinese account
The history explains India’s caution. The 2020 Galwan clash killed 20 Indian and four Chinese soldiers. Relations have subsequently improved, but substantial military deployments remain in the Himalayas. Diplomatic recovery has not removed the underlying security problem. Reuters
Progress nevertheless deserves recognition. At their August 2025 meeting in Tianjin, Modi and Xi welcomed the previous year’s disengagement and discussed further improvements in travel and commercial relations. That history provides a useful benchmark: subjects already discussed a year ago now require evidence of implementation. August 2025 official statement
External Affairs Minister S. Jaishankar expressed a sensible approach at the Economic Times World Leaders Forum on August 22. He linked the difficult period between summer 2020 and autumn 2024 primarily to conditions along the border, while arguing that India must engage commercially with China. “But it is important we deal with them confidently,” he said. PTI report published by Bussiness
Confidence should mean maintaining dialogue, defending legitimate security interests and insisting that commercial commitments produce measurable results. India should pursue cooperation with a clear understanding of where dependence can weaken its negotiating position.
The trade figures illustrate that imbalance. The Department of Commerce’s annual report records Indian goods imports from China of US$113.45 billion in fiscal 2024/25, against exports of US$14.25 billion. Calculated from those figures, India bought almost eight dollars’ worth of goods for every dollar it sold. The deficit widened from US$85.07 billion the previous year to US$99.20 billion, an increase of approximately 16.6 percent. Department of Commerce annual report
There is also a counterpoint that deserves attention. The same report’s provisional figures show Indian exports to China increasing by 32.6 percent during April to November 2025 compared with the corresponding period a year earlier. China does buy Indian products, and the record includes growth as well as setbacks. A large deficit alone cannot establish which barriers are unfair or explain every difference in competitiveness. Department of Commerce annual report
The broader imbalance persisted, however. Reuters reported on September 12 that India’s imports from China reached approximately US$132 billion in fiscal 2025/26, leaving a deficit exceeding US$100 billion. Reuters
India therefore needs specific commercial gains: transparent requirements, predictable decisions and opportunities for competitive Indian suppliers to secure Chinese customers. India must also improve its own manufacturing capabilities. A stronger negotiating position requires products that overseas buyers want and businesses equipped to deliver them.
The reported difficulties obtaining Chinese business visas show how practical obstacles can undermine diplomatic progress.
In August, electronics and automobile manufacturing executives told The Economic Times that China was approving only 20 to 40 percent of their companies’ recent business visa applications, compared with nearly all previously. Bussiness’s account described operational and project delays. These were individual company estimates, rather than a national approval rate. They do not establish a blanket ban or prove a retaliatory motive. The Chinese embassy did not respond to the newspaper’s request for comment. Bussiness’s account of the reporting
By September 8, India’s Ministry of External Affairs had confirmed that it had raised the difficulties with Beijing. The New Indian Express also reported that some companies were meeting Chinese counterparts in Singapore, while industry association ASSOCHAM had urged government intervention over disruptions to technology movement and supply chains. The New Indian Express
For a manufacturer, access to a supplier can matter as much as access to the supplier’s products. If managers cannot inspect equipment, resolve quality problems or coordinate a production change, uncertainty can spread through purchasing, assembly and delivery schedules. Restoring dependable business travel would be a practical demonstration that normalisation is reaching the companies expected to sustain it.
India’s own restrictions also belong in this assessment. Press Note 3, introduced in April 2020 before the Galwan clash, concerns investment screening involving countries sharing a land border with India. It does not impose a blanket political clearance requirement on every purchase from a Chinese supplier. On March 10, 2026, the Cabinet approved changes that included a 60 day decision period for specified manufacturing investment proposals, subject to ownership and control conditions. Cabinet announcement
The difficulty of reducing dependence through restrictions alone was examined by Keshav Thakur in a June analysis for South Asian Voices, a publication of the Stimson Center. His argument was that limits on Chinese participation can constrain Indian production when alternative technology, machinery and expertise are not yet available. Building domestic capability must accompany efforts to reduce exposure. South Asian Voices analysis
Reciprocity also requires acknowledging China’s objections to Indian policies. In a separate World Trade Organization dispute, Beijing has challenged Indian incentives involving batteries, automobiles and electric passenger cars, alleging discrimination against imported goods. India has maintained that its schemes comply with WTO rules. These are contested claims undergoing examination. WTO account of the dispute
The WTO established the panel on February 24, 2026, and its members were selected on May 28. Canada reserved third party rights in the proceedings. That provides a concrete Canadian connection to the trade rules under examination, although it does not establish Canadian support for China’s allegations or a loss suffered by a Canadian company. WTO dispute record, DS642
For Greater Toronto Area businesses, the potential supply chain connection is straightforward. An importer buying goods assembled in India could still depend indirectly on Chinese components or production equipment. If a supplier’s access problems delay assembly, the Canadian buyer could face later deliveries, additional inventory requirements or cash tied up in an unfinished order.
That is a mechanism of potential exposure. The public reports reviewed here do not establish a particular GTA company’s loss. A documented local case would require the business’s account, shipment dates and records showing the resulting costs.
This matters as Canada pursues its own commercial relationship with India. Obnews reported on September 11 that the countries were aiming to advance trade negotiations toward a year end agreement. The reliability of production and sourcing networks will matter alongside the opportunities created by diplomacy. Obnews’s previous coverage
A more dependable India–China relationship could also strengthen international diplomacy. Cooperation between the two countries could support negotiations, reduce economic disruption and give other governments more options when disputes threaten wider stability.
The September 12 BRICS declaration offers a starting point. It supports preventive diplomacy and mediation with the consent of the relevant parties, and calls for maintaining the flow of trade, supply chains and energy. Those commitments recognise both the possibilities and the limits of diplomatic influence. BRICS New Delhi Declaration
India and China cannot settle every international conflict simply by agreeing with each other. Other countries retain their own interests and choices. Their cooperation would become more persuasive, however, if they demonstrated that they could manage their own disagreements through consistent agreements and reciprocal concessions.
The next phase should therefore be judged against observable results: compliance with border understandings, reliable business visa procedures, specific improvements in market access and timely resolution of companies’ complaints. The Indian account of the September 12 meeting does not announce a quantified trade target, a border settlement deadline or a timetable for resolving business visa difficulties. Those remain matters for follow through. Official meeting statement
China must demonstrate greater consideration for India’s security and commercial concerns. India must continue strengthening the industrial capacity that gives its diplomacy weight. Both governments should make it easier for legitimate cooperation to survive periods of disagreement.
Modi and Xi could help build a more stable international order. The credibility of that ambition will begin with the agreements their governments honour and the opportunities their businesses can actually use.