India considers easing barriers for Chinese investments

India is considering easing restrictions on trade and investments with China as tensions have reduced along their border. This comes amid pressure from the US to lower tariffs. India has a growing trade deficit with China, prompting officials to explore options for revitalizing economic ties. Discussions are ongoing to relax some trade barriers put in place after the 2020 Galwan clashes between Indian and Chinese soldiers. Proposed changes include easing visa rules for Chinese workers and lifting some import tariffs. Some restrictions on Chinese apps may also be reconsidered. The Indian government is contemplating allowing more Chinese investment to address the widening trade deficit. Currently, trade mainly favors China, and easing certain restrictions could signal a willingness to normalize relations. Key proposals involve making it easier for Chinese companies to invest in India, including allowing joint ventures. Trade between India and China reached $118.4 billion in fiscal year 2024, with China becoming India's largest trading partner again. However, the significant trade deficit with China, which exceeded $83 billion in 2023, highlights concerns over limited exports from India and access barriers to Chinese markets. While discussions about relaxing trade barriers are taking place, there is recognition of the complexities in decoupling from China. India is trying to find a middle ground to attract Chinese investments without heavily relying on imports of finished goods. Government reports encourage investment from China while suggesting measures to protect local industries from potential market disruptions.