Xi’s Upcoming India Visit May Ease Tensions, But Business Barriers Remain

Chinese President Xi Jinping’s anticipated visit to New Delhi this week, his first to India in seven years, is expected to further improve diplomatic relations between the two countries, though analysts say meaningful progress on business ties remains uncertain. Companies on both sides continue facing obstacles including stalled investments, visa delays and equipment restrictions, highlighting a gap between political warming and economic cooperation.

Trust Deficit Persists Despite Recent Improvements

Relations between the neighbors have remained cautious since a deadly 2020 border clash, though ties have gradually improved as both nations navigate uncertain relationships with the United States. Experts note that while India eased some investment restrictions on Chinese firms earlier this year, particularly in electronics and solar sectors, major Chinese companies including automakers BYD and Great Wall Motor have shelved planned investments in India after facing increased scrutiny.

Restrictions Flow in Both Directions

China has reportedly directed companies not to sell certain critical technology and infrastructure equipment to India, including solar panels and manufacturing equipment, while some Indian businesspeople have faced difficulty securing visas to China. India, meanwhile, has declined to approve a payment platform linked to China’s Ant Group over national security concerns and is reviewing potential investigations into smartphone maker Xiaomi. Despite these frictions, officials from both countries have described each other as partners rather than competitors, and analysts say a successful meeting between the two nations’ leaders could help address some of the ongoing barriers.