Executive Summary

This report will focus on the trade relationship that exists between the two powerful emerging
economies of the world – India and China and the ways it has changed over time from last 10 years.
Both the economies are open up to each other in terms of trade, but in spite of their bilateral
cooperation tension exists between these two economies that disrupt their trade relations.

The main issues that exist between these two economies are the tariff and non-tariff barriers imposed
by both the countries to safeguard their domestic industries and maintain trade balance. There are
some political issues as well related to border between the two countries and water sharing issues that
creates dispute between two countries. The strong relationship shared between China and Pakistan also
affects the trade relationship between India and China because of the bitter rivalry between India and
Pakistan. We have also demonstrated the progress of these two economies in last 10 years and the ways
the formulation of various agricultural, services, and industrial sector reforms have helped economies in
for developing their trade relationship. The relationship between India and China have fostered after
recent visit of Indian Prime Minister Mr. Narendra Modi to China in 2015.China and India signed up 24
agreements worth US $10 billion related to various fields such as trade, culture, and investment that
have made their trade relationship stronger and in can be predicted that with their recent development
these two economies will merge as the power houses in the world in future.