India signs pact with China to better trade ties, get $20bn

India today signed a 5-year trade and economic cooperation agreement with China with a view to improve the trade balance and obtain USD 20 billion Chinese investment into the country.

The 'Five year Trade and Economic Development Plan' was signed by Commerce Minister Nirmala Sitharaman and her Chinese counterpart Gao Hucheng in presence of Prime Minister Narendra Modi and visiting President Xi Jinping.

The agreement lays down a medium term roadmap for promoting balanced and sustainable development of economic and trade relations between China and India, on the principle of equality and mutual benefit.     Among other things, it seeks to reduce bilateral trade imbalance and strengthen investment cooperation to realise USD 20 billion investment from China in 5 years.

Also a transparent, stable and investor friendly business environment and an enhanced cooperation between Chambers of Commerce and financial sectors of the two countries would also be covered under the pact.

The trade gap between the two countries stood at USD 35 billion in favour of China. The total bilateral trade was at USD 66.4 billion trade last year.

Sitharaman and Gao also signed the minutes of the tenth session of India-China Joint Economic Group held earlier this month in Beijing.

Both sides during the Beijing meeting held detailed discussions on various issues to promote broad and deep bilateral trade and economic cooperation and agreed to undertake measures to achieve sustainable and balanced trade.

Specific measures to enhance market access to Indian products such as agricultural and pharmaceutical, and export of services were also discussed during that meeting.