India and China have come to an agreement to engage in discussions aimed at addressing particular concerns related to trade and economics as they strive to stabilize and restore their bilateral relationship following the conclusion of the military confrontation in the Ladakh region along the Line of Actual Control (LAC).

The discussions between Misri and Sun, who previously served as an envoy to India, were part of a series of meetings that have occurred since the two nations reached an agreement last October to withdraw troops from the two remaining “friction points” along the LAC, aiming to resolve the confrontation that began in April-May 2020.

These talks took place amid rising worries in India regarding the effects of China's restrictions on rare earth exports, especially affecting electric vehicle manufacturers.

A statement issued by the external affairs ministry indicated that the two parties "agreed to hold certain functional dialogues in the areas of economic and trade to address and resolve specific issues of concern."

However, the statement did not provide specifics regarding the concerns discussed.

Nonetheless, the discussions indicated that the Indian side raised China’s export restrictions on rare earth materials, in which China holds a near monopoly, during latest talks.

 

Other areas of concern cited by these individuals included India's ongoing worries about insufficient access to Chinese markets and the growing trade deficit with China, which reached $99.2 billion in the financial year 2024-25.

External affairs ministry spokesperson Randhir Jaiswal stated that the Indian side has been in communication with Chinese officials following the announcement by China’s commerce ministry and the General Administration of Customs regarding export controls on specific rare earth items in April.

"We are in contact with the Chinese authorities, both in Delhi and in Beijing, to ensure predictability in supply chains for trade that aligns with international standards," he explained.

Misri and Sun assessed the developments in their bilateral relations since their last meeting in Beijing on January 27 and agreed to "continue to stabilize and rebuild ties," placing emphasis on engagements centered on people, according to the readout. Misri mentioned a meeting of the expert-level mechanism on transborder rivers in April that focused on resuming the provision of hydrological data and other forms of cooperation, expressing hope for progress on these issues.

A statement from the Chinese embassy characterized the discussions between Misri and Sun as "candid and in-depth," noting that both sides agreed to jointly prepare for the 24th meeting of the Special Representatives on the India-China boundary issue at a suitable time. The two Special Representatives, National Security Adviser Doval and Chinese foreign minister Wang Yi, last convened in Beijing in December 2024.

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The two nations will also "advocate for the resumption of direct flights and the exchange of resident journalists at the earliest opportunity, facilitate exchanges between people, and steadily resume bilateral dialogue mechanisms," the Chinese statement added.

Sun noted that coordinated efforts between India and China have produced a "hard-won momentum of improvement and development" in their bilateral relations. He emphasized the need for both sides to manage their relationship from a long-term viewpoint, enhance political mutual trust, foster cooperation across various sectors, and "appropriately manage disagreements and differences."

Misri expressed gratitude for the Chinese side’s assistance in resuming the Kailash Manasarovar Yatra this month. The pilgrimage to Mount Kailash and Mansarovar Lake in the Tibet Autonomous Region had been halted since 2020 due to the Covid-19 pandemic and the prolonged face-off along the LAC.

The two parties also talked about activities planned to celebrate the 75th anniversary of diplomatic relations between India and China and agreed to facilitate these events.