On the eve of a key meeting between Prime Minister Manmohan Singh and President Hu Jintao, China today said it is "ready to work" with India to deal with the controversial stapled visa issue.
In Delhi, senior officials said there was some movement on the issue but India will have to wait and watch how things evolve.
Replying to a question about whether the leaders will discuss issues concerning stapled visas and resumption of defence talks, Chinese foreign ministry official Hong Lie told a media briefing in Beijing that China is ready to solve issues relating to people to people exchanges.
"As for the issue you mentioned, China is ready to work with India to have friendly consultation and properly handle the issues relating to people to people exchanges in our bilateral relations," Hong said.
"We are very confident about the prospect of bilateral relations," he said. China was also willing to work with India on resumption of defence exchanges.
Singh and Hu will meet tomorrow in Sanya in China ahead of the BRICS summit.
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The statement comes in the backdrop of Beijing granting normal visas to four journalists born in Jammu & Kashmir, who are visiting Sanya in Hainan province to cover the Brazil, Russia, India, China and South Africa, (BRICS) summit beginning tomorrow.
India called off defence exchanges last year after China refused visa to an Indian Army General BS Jaswal on the ground that he headed troops in Jammu and Kashmir.
China had in 2008 started the practice of issuing visas on loose sheets of paper to people from Jammu and Kashmir, which was seen here as questioning India's sovereignty over the state.
This had been an irritant in bilateral relations and the matter had snowballed into a major controversy last July after the Jaswal episode.
Indian officials were cautiously optimistic that China may have decided to stop the practice, taking on board Indian concerns.
They said the two countries will have to work quietly on this without making any announcements.
Singh had taken up the stapled visa issue with President Hu in Vietnam in October last year when they had met on the sidelines of the ASEAN Summit.
The issue was again raised in December with Chinese Premier Wen Jiabao when he visited India.