India and China, two of Asia’s biggest powers, are entering a new phase in their relationship in 2025. After years of border tensions and trade disputes, both nations are now moving towards selective cooperation, shaped by diplomacy, economics, and global politics.
➥ Diplomatic Reset
In August 2025, Chinese Foreign Minister Wang Yi visited Delhi, meeting Prime Minister Modi and top Indian officials. This marked a significant thaw, with both sides agreeing to:
Restart direct flights and issue visas for journalists, students, and businesspeople.
Resume cultural exchanges and border trade through key passes.
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Strengthen military and diplomatic mechanisms to reduce tensions along the Line of Actual Control (LAC).
This sets the stage for PM Modi’s upcoming visit to China for the SCO Summit in Tianjin his first in seven years.
➥ Trade and Economic Shifts
While trade is booming, India faces a huge deficit:
Imports from China – over $113 billion
Exports – just $14 billion
Experts highlight that India has a $161 billion untapped export potential with China, especially in sectors like pharmaceuticals, IT services, and agriculture.
At the same time, China has eased fertilizer exports, which will benefit Indian farmers. India is also considering easing visa rules for Chinese executives from companies like Vivo, Xiaomi, and BYD, which could revive investments and supply chains.
➥ Geopolitical Angle
Another big shift comes from the U.S. factor. With Washington imposing heavy tariffs, especially under Trump’s trade policies, both India and China are finding it practical to work together where interests align. China has even supported India by opposing U.S. tariff hikes, signaling a new level of cooperation.
➥ The New Angle: Pragmatic Convergence
India and China are not becoming close allies, but they are adopting a pragmatic approach:
Cooperate on trade, visas, and diplomacy.
Manage border tensions without major escalations.
Balance U.S. pressure by engaging with each other.
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The year 2025 marks a turning point in India–China ties. Instead of rivalry dominating every aspect, both nations are moving towards issue-based cooperation. The new angle is clear: compete where necessary, cooperate where possible.
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