India and China Take Steps Towards Resuming Border Trade Through Key Himalayan Passes

MGMMTeam
Aug 14
3 min read

In a significant move towards easing long-standing tensions, India and China are engaged in high-level discussions to resume cross-border trade through three vital Himalayan mountain passes—Lipulekh in Uttarakhand, Shipki La in Himachal Pradesh, and Nathu La in Sikkim. The talks come after a five-year hiatus brought on by heightened border tensions, the COVID-19 pandemic, and strained diplomatic relations.

*MEA spokesperson during a media briefing on Thursday (Photo: PTI) | India Today*

Diplomatic Engagements and Strategic Timing

The Ministry of External Affairs has confirmed ongoing dialogue with Beijing to reopen these designated border trade points. MEA spokesperson Randhir Jaiswal emphasised that both nations are committed to constructive engagement and finding mutually acceptable solutions. The timing of these negotiations is strategically significant, as Chinese Foreign Minister Wang Yi is scheduled to visit New Delhi this week to meet India’s National Security Adviser Ajit Doval and External Affairs Minister S. Jaishankar.

This visit is expected to lay the groundwork for a potential meeting between Prime Minister Narendra Modi and President Xi Jinping on the sidelines of the Shanghai Cooperation Organisation (SCO) summit later this month. The encounter, if it takes place, would mark the first such bilateral meeting in seven years and could be a major step towards resetting relations.

Economic and Symbolic Significance

Although trade through these passes represents only a small fraction of the $127.7 billion annual bilateral trade, its symbolic importance is far greater. Border commerce supports local livelihoods in remote areas, facilitates cultural exchange, and can serve as a bridge for better political understanding. For Beijing, the reopening is framed as a means to enhance the welfare of residents in border regions, while for New Delhi, it signals a willingness to explore cautious cooperation without compromising on national security concerns.

The Lipulekh Pass, located at the trijunction of India, China, and Nepal, has long been a vital route for trade and pilgrimage. Shipki La, in Himachal Pradesh, connects India to Tibet’s Ngari Prefecture, primarily facilitating local and small-scale commerce. Nathu La, one of the most historic trade routes, was reopened in 2006 after being shut since the 1962 war, allowing exchange in goods such as wool, silk, and agro-products.

A Thaw in Bilateral Relations

These talks come amid a broader thaw in relations after years of mistrust, particularly following the 2020 Galwan Valley clashes. In recent months, both countries have signalled readiness to restore certain channels of cooperation. India and China have already agreed to resume direct passenger flights as early as next month, a move seen as complementing the reopening of land trade routes. Airlines have reportedly been instructed to prepare routes in advance, with a formal announcement likely during the SCO summit.

The gradual improvement in ties is also influenced by shifting global dynamics. With U.S. tariffs affecting both nations and the Trump administration’s unpredictable policy stance, New Delhi appears to be diversifying its diplomatic outreach. For China, rebuilding ties with India aligns with its interest in regional stability, particularly along the Line of Actual Control (LAC).

Historical Context and Infrastructure Readiness

India’s readiness to revive border trade is supported by ongoing infrastructure projects under the India–China Border Roads initiative, which aims to strengthen connectivity along sensitive stretches of the LAC. Moreover, the 2013 Border Defence Cooperation Agreement continues to provide a framework for military restraint and communication, reducing the risk of incidents during peacetime trade operations.

Historically, these border passes have played an essential role in economic and cultural exchanges between the two nations. While modern geopolitical realities have disrupted their use, their reopening could revive centuries-old patterns of Himalayan trade and interaction.

Looking Ahead

Chinese Foreign Minister Wang Yi’s upcoming visit is expected to set the tone for the next phase of India–China relations. If border trade resumes, it could pave the way for further cooperation in tourism, infrastructure, and regional development projects. However, both nations remain cautious, aware that unresolved boundary disputes and mutual security concerns could still hinder deeper economic integration.