 Border & water issues-Political issue that affects the trade between two nation is the

border issue which is rooted in the status of McMohan Line, which the border between
India and China when Tibet was forcibly occupied by China in 1950. Also, China claims
90,000 sq.km of the territory in Arunachal Pradesh which is a state situated in east India.
Recently there was a dispute going on between India and China on Doklam border that
aroused in June, 2017. This dispute was regarding occupying a territory named as
Doklam, which is disputed area between China and Bhutan located their tri-junction with
India. Therefore, there are tensions that keep on arising at the border between these two
countries which affects the political situations in their nations and eventually disrupts the
trade relations as well.
Another issue that creates tension between two nations is related to water flowing from
the four major rivers from China to India. China plans to construct dams on these rivers
to divert water towards its own and discontinuing their flow in India, which will be
disadvantageous for Indian economy. (Dar & Ahmad, 2014).