India and China are in discussions to resume border trade after a gap of five years, a report by Bloomberg has claimed, citing officials in New Delhi who are familiar with the matter.
Amid US President Donald Trump’s ongoing trade-related rifts with multiple nations, including India, there seems to be easing of tensions between India and China, both countries beleaguered by hikes in tariffs on their exports by the US on account of continued buying of Russian crude. Trump has accused India of indirectly funding Russia’s war on Ukraine via purchase of Russian oil.
China, meanwhile, has also relaxed restrictions on urea exports to India, paving the way for 300,000 tonnes of the fertiliser to come to the country, which is a leading global urea importer. Last year, China had stopped exports of urea to all destinations.
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India, being an agrarian economy, depends heavily on fertilisers, especially urea, which it also subsidises for its farmers. A report by the Fertiliser Association of India said India’s urea imports declined by almost 20 per cent to 5.7 million tonnes during the fiscal year that ended on March 31, 2025.
The organisation also noted that India’s imports of urea from China decreased to almost 100,000 tonnes in 2024-25, a significant reduction from 1.87 million tonnes in the previous year.
The easing of trade relations between India and China has come after years of deteriorating diplomatic association between the two, especially after the 2020 border confrontations. This followed downgrading of trade, including banning of the popular China-based app, TikTok, as part of the sanctions, and visa cancellations.
India has now lifted restrictions on tourist visas for Chinese citizens.
Prime Minister Narendra Modi is also expected to meet Chinese President Xi Jinping during a summit in Tianjin that begins August 31.
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