Setting up Chinese Industrial Parks in India, increased access to Indian products to bridge the ballooning trade deficit besides border issues was expected to figure in Prime Minister Narendra Modi's first meeting with Chinese President Xi Jinping on the sidelines of the BRICS summit.
Officials say that a mix of bilateral economic, trade and strategic issues was expected to figure in the maiden meeting between the two leaders who had the reputation of being strong leaders in their respective countries.
Their meeting likely to be held on July 15 is taking place in the backdrop of signing of Memorandum of Understanding to facilitate Chinese Industrial Parks in India during last month's visit of Vice President Hamid Ansari in Beijing.
Commerce Minister Nirmala Sitharaman, who was part of Ansari's delegation, held extensive talks with her Chinese counterpart Gao Hucheng. She said India is expecting China to set up four Chinese industrial parks with substantial investments. Sitharaman is also accompanying Modi during his Brazil trip for BRICS meet.
India looks to China to come up with a big investment commitment to translate its promises to address the ballooning trade deficit, which in the five month of this year climbed to nearly $13 billion.
According to the January-May data released by the Chinese customs, China's exports to India amounted to $20.18 billion, while Indian imports to China totalled to just $7.992 billion.
Indian official say that the annual trade deficit in the last few years is averaging around $35 billion, making bilateral trade unsustainable.
China while acknowledging the trade deficit has promised to step up its investments from the present $1.1 billion, mostly in Gujarat. The Chinese industrial parks which were in the pipeline for some time could become a reality as the MoU provide the framework for their functioning.
China reportedly plan to establish one Park but it is to be seen whether it would be finalised during Modi-Xi meeting or during the proposed Chinese President’s visit to New Delhi later this year.
The new Indian government sees the Parks as important initiative to bring in the much needed Foreign Direct Investment into the economy.
India wants more proactive support from China to its push for better market access to IT and Pharmaceuticals, which Indian official see better prospects in Chinese markets.
Besides the two key trade issues, India's concerns over incursion of Chinese troops along the Line of Actual Control, operationalisation of last year's Border Defence Cooperation Agreement on the ground as well as its aspiration to become permanent member of the UN Security Council were expected to figure in the talks.