At the Shanghai Cooperation Organisation (SCO) Summit 2025 in Tianjin, China, Prime Minister Narendra Modi and Chinese President Xi Jinping held a crucial bilateral meeting on August 31, 2025, where both leaders vowed to strengthen ties between India and China, particularly in the areas of trade, investment, and multilateral cooperation. The meeting comes at a time when the global economy is under strain due to the prolonged US trade war, and both India and China see themselves playing a key role in stabilising world trade.

During the discussions, Prime Minister Modi emphasised that peace along the India-China border should act as an “insurance policy” for better relations, reflecting India’s long-standing stance that bilateral ties cannot advance meaningfully without stability at the boundary. On the other hand, President Xi Jinping highlighted that the relationship between the two countries should not be defined solely by disputes or differences, noting that both nations share far more common ground than conflicts.

Focus on Trade and Investment

The leaders jointly acknowledged that India-China economic cooperation has the potential to contribute significantly to global trade stability. Prime Minister Modi pointed out the need for narrowing the trade deficit and building strategic trust in investment flows. India’s Foreign Secretary Vikram Misri explained after the meeting that both leaders saw a unique opportunity to leverage the global tariff situation to expand commercial ties.

A significant step forward was the announcement that direct flights between India and China will soon resume, which had been restricted due to the pandemic and subsequent geopolitical tensions. This move is expected to boost business exchanges, tourism, and people-to-people contacts, giving bilateral trade a much-needed push.

Xi Jinping’s Four-Step Proposal

Chinese President Xi Jinping laid out a four-point plan to further strengthen bilateral ties between the two Asian giants:

1. Strengthening communication between leadership and institutions to avoid misunderstandings.

2. Expanding cooperation in trade, technology, and investment sectors.

3. Accommodating each other’s concerns to build trust and reduce tensions.

4. Bolstering multilateral coordination within forums like the SCO and BRICS to safeguard fairness and counter protectionist measures, particularly US-led tariffs.

Xi stressed that both countries must defend multilateralism, fairness, and justice, while underlining the SCO’s growing role in shaping regional and global economic frameworks.

Modi’s Emphasis on Strategic Autonomy

Prime Minister Narendra Modi highlighted that India and China, as two independent civilisational powers, must pursue their relations based on strategic autonomy and should not allow third countries to dictate or influence their bilateral ties. Modi also urged that the two countries should adopt a long-term vision for cooperation rather than letting boundary disputes define the entire relationship.

The two leaders welcomed the steady progress in engagement since their last meeting in October 2024 in Kazan, Russia, which had laid the foundation for confidence-building measures.

Bilateral and Multilateral Engagement

In addition to his meeting with President Xi Jinping, Prime Minister Modi also engaged with Cai Qi, a senior member of the Standing Committee of the Politburo of the Communist Party of China. Discussions revolved around finding pathways for strengthening trade relations, increasing investment flows, and building stronger diplomatic bridges.

As a gesture of goodwill and forward-looking diplomacy, Prime Minister Modi invited President Xi Jinping to visit India for the BRICS Summit in 2026, signaling India’s readiness to host China at a high-level forum and reinforce ties despite underlying differences.

Strategic Significance of the Meeting

This bilateral meeting holds strategic weight as it took place on the sidelines of the largest-ever SCO Summit, with 20 foreign leaders and 10 heads of international organisations attending, including UN Secretary-General António Guterres. With both India and China emerging as pivotal players in shaping global trade narratives, their cooperative stance has global implications.

Moreover, this engagement signals that despite challenges such as border disputes and geopolitical rivalries, both nations recognise the necessity of economic interdependence and the stabilising role they can play together in a world economy grappling with uncertainty.

Conclusion

The Modi-Xi Jinping meeting in Tianjin has set the stage for a renewed push in India-China relations, particularly in economic and trade domains. By stressing consensus over conflict, proposing concrete steps for cooperation, and committing to revive people-to-people ties, both leaders showcased their intent to move forward pragmatically. The coming months, particularly in the lead-up to the 2026 BRICS Summit in India, will reveal how far these commitments translate into tangible outcomes.

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