Hu proposes free trade area for China-India

China today made strong overtures to improve trade and business relations with India even as Pakistani foreign policy experts emphasised that Beijing was not warming up to India at the expense of its long-standing friendship with Islamabad.

Chinese President Hu Jintao, addressing a gathering of Chinese and Indian companies in Mumbai, drew a standing ovation by proposing a free trade area between the two countries and a slew of other measures to expand economic relations, sweep away mistrust and speed up efforts to resolve border disputes.

"A China-India free trade area will lift the bilateral business relations to a higher level and promote regional economic integration in Asia," said Hu, who, upon his arrival in New Delhi, had issued a joint statement with Prime Minister Manmohan Singh that efforts will be made to raise the bilateral trade from $18 billion to $40 billion in four years.

The two countries have started a joint feasibility study on regional trade arrangement which will be concluded by October next year.

He said India and China should promote border trade to widen bilateral trading channels, strengthen cooperation in key areas like information technology, energy resources, infrastructure, science and agriculture, and improve the trade and investment environment.

China would also like to work closely with India at the World Trade Organisation to uphold developing countries' rights.

Soon after his address, the spokesperson for China's foreign ministry in Beijing described Hu's visit to India - the first by a Chinese President in a decade - as highly significant, and added that China was working to forge a "long-term and stable" strategic partnership with New Delhi.

"This is a set state policy of China... We are willing to work together with India to push forward the stable development of bilateral relations," she said.

Meanwhile, Maharashtra today bagged the largest Chinese foreign direct investment in the country, of $70 million, through the Sany Group of China for setting up a greenfield project near Pune.