China and India agreed on Sunday to reopen border trade at the
Nathu La Pass on July 6 after 44 years' closure.
Officials from both sides ended the discussion on the issue in
Lhasa, capital of Tibet Autonomous Region, and signed on the
agreed minutes on Sunday.
The Natu La Pass is 4,545 meters above sea level. It is 460
kilometers away from Lhasa and 550 kilometers from the Indian
coastal city of Calcutta. The pass used to be an important trade
passage between China and India.
The reopening of the pass is expected to give a major boost to
bilateral trade between the two most populous countries.
Trade in this area accounted for 80 percent of the total border
trade volume between China and India in the early 1900s. Trading
through the pass was suspended in 1962 after border conflicts.
"The reopening of border trade will help end economic isolation
in this area and play a key role in boosting market economy there,"
said Hao Peng, vice chairman of the autonomous region.
"It will also boost the transportation, construction and service
industries, paving the way for a major trade route that connects
China and south Asia," Hao added.
"The resumption of border trade is a great historic event, not
only for enlarging trade, but also for greater relations between
the two great countries," said Dr. Christy Fernandez, additional
secretary of the Indian Department of Commerce.
The resumption of border trade reflects the improved ties
between China and India, said Professor Liu Jiangyong with the
institute of international studies of the Beijing-based Qinghua
University.
He said that China and India have been exploring ways of mutual
beneficial cooperation in the economic and trade fields, adding the
accord on the guidelines for border demarcation signed in 2005 by
the two countries created a peaceful environment.
Both sides marked 2006 as the year of Sino-Indian
friendship.
More than 5,000 border residents came to Yadong county, where
the Nathu La Pass is located, every year for a trade of 3.6 million
yuan (US$450,000), although the trading port in Yadong did not
officially open, statistics from the county show.
China and India signed a memorandum of understanding on the
resumption of border trade at the Nathu La Pass in 2004. The
Chinese State Council approved the plan on the construction of
border trade markets in Yadong in the ensuing year.
"The reopening of the Nathu La Pass is a key move in
strengthening economic and trade ties, which will also enhance
mutual political trust," Prof. Liu said.
China and India recorded US$18.73 billion in trade volume in
2005, up 37.5 percent from the previous year, according to the
Chinese Ministry of Commerce. The volume is expected to exceed
US$20 billion this year.
Currently China and India trade is mostly by sea transportation.
Tibet Autonomous Region imports from and exports to India via
Tianjin, a port city in the north which is thousands of kilometers
away.
Tibet is expected to benefit much from the resumption of border
trade at the Nathu La Pass, Hao Peng said.
"If only 10 percent of Sino-Indian trade goes through the pass
it means at least more than US$1 billion a year."
Last year the foreign trade volume of Tibet was US$200
million.
Tibet has achieved rapid economic growth, with the annual GDP
growth above 12 percent in the past five years, higher than the
country's average, said Tibet Autonomous Region Chairman Qiangba Puncog on Saturday while meeting the
Indian commercial and trade delegation headed by Christy
Fernandez.
Qiangba said China and India's friendship has a long history and
the economic and trade cooperation between the two nations has been
close in recent years.
He said the Chinese government attaches great importance to
bilateral economic and trade cooperation.
With the reopening of Nathu La Pass, iron ore and livestock
products from India and wool, herbs and electric appliances from
China can be transported into the other country through the short
cut, Hao said.
Businessmen have showed interests in the area after China
approved the construction of border markets in Yadong in 2005.
Wang Ping, head of the Yadong county government, said more than
30 business people came to Yadong in the first quarter for
investment talks this year, while only two or three came the same
period last year.
(Xinhua News Agency June 19, 2006)