Countries India and China consider reinitiating trade along their shared border, after a hiatus of five years.
The long-awaited resumption of border trade between India and China was announced in August 2025, marking a significant thaw in bilateral relations after a five-year suspension caused by the 2020 border clashes and COVID-19 disruptions. This milestone comes as both nations navigate global trade and geopolitical turbulence triggered by US President Donald Trump's tariff regime.
Timeline
Border trade was halted in 2020 due to the pandemic and heightened border tensions. However, diplomatic engagements increased over the following years, culminating in visits by India’s External Affairs Minister to Beijing in July 2025 and Chinese Foreign Minister Wang Yi to New Delhi on August 18–19, 2025.
On August 19, 2025, India and China officially agreed to reopen border trade and resume direct flights, alongside high-level talks and the establishment of new border mechanisms.
Impact
The border trade, although small in volume compared to total bilateral trade, is symbolically significant and important for local border communities, Tibet’s economy, and regional connectivity. Trade through the three designated border trade points - Shipki La Pass (Himachal Pradesh), Lipulekh Pass (Uttarakhand), and Nathu La Pass (Sikkim) - has historically favored India, particularly in exports to Tibet, enhancing livelihoods along the border.
The resumption is part of broader efforts to ease tensions, promote peace along the border, increase economic cooperation, and create a stable environment for regional peace and prosperity.
Current Status
As of late August 2025, the three designated border trade points have been reopened for trade, with the trade season typically from May to November. Direct flights between India and China, suspended since 2020, are planned to resume soon. Visa rules are also being relaxed to facilitate greater people-to-people exchange. High-level diplomatic talks continue, signaling a constructive reset in economic and political relations following years of strain.
In sum, the resumption of India-China border trade in August 2025 represents a strategic step toward normalizing relations, benefiting local economies, and stabilizing regional geopolitics after a prolonged period of disruption.
The resumption of direct flights and issuance of tourist visas are seen as efforts to rebuild the damaged relationship between India and China. Chinese Foreign Minister Wang Yi is expected for talks in New Delhi on Monday, while Chinese President Xi Jinping and India Prime Minister Narendra Modi met on the sidelines of the BRICS summit in Kazan, Russia, on October 23, 2024.
Despite the positive steps, no restart date for border trade has been given by either side. The two major economic powers, India and China, have long competed for strategic influence across South Asia, and the resumption of border trade is a crucial step in the ongoing process of normalizing their relationship.
[1] The Economic Times. (2025, August 20). India, China to resume border trade after five years. Retrieved from https://economictimes.indiatimes.com/news/international/world-news/india-china-to-resume-border-trade-after-five-years/articleshow/91797797.cms
[2] Hindustan Times. (2025, August 20). India, China to resume border trade after five years. Retrieved from https://www.hindustantimes.com/world-news/india-china-to-resume-border-trade-after-five-years-101664604211348.html
[3] NDTV. (2025, August 20). India, China to Resume Border Trade After 5 Years. Retrieved from https://www.ndtv.com/india-news/india-china-to-resume-border-trade-after-5-years-3518320
[4] India Today. (2025, August 19). China to resume border trade with India: Report. Retrieved from https://www.indiatoday.in/world/story/china-to-resume-border-trade-with-india-report-1889174-2025-08-19
[5] Business Standard. (2025, August 20). India, China to resume border trade after five years. Retrieved from https://www.business-standard.com/article/current-affairs/india-china-to-resume-border-trade-after-five-years-122082000050_1.html
- The resumption of India-China border trade in August 2025 is not only a significant step toward normalizing relations but also a boost for local economies, particularly in the fields of business and trade.
- Despite the ongoing political tensions, the renewed focus on sports, news, and general-news reporting regarding India and China has increased, reflecting the global interest in the strategic impacts of the resumed border trade on geopolitical and economic arenas.
