While meeting on the sidelines of the BRICS Summit, Indian Prime Minister Narendra Modi and Chinese President Xi Jinping agreed that the new high-level mechanism to reduce the $53 billion trade deficit between the two countries should meet an early date.
"The two leaders agreed that the new High-Level Mechanism on Trade and the Economy should meet at an early date. Both agreed on the importance of maintaining close dialogue on matters relating to trade and investment," said the Indian external affairs ministry.
This is the first meeting of both the leaders after their second informal summit in Mamallapuram near Chennai, India last month. Both India and China had then agreed to set up a ministerial group headed by Finance Minister Nirmala Sitharaman and China's Vice Premier Hu Chunhua.
Worried about the influx of cheap Chinese goods into India and China's stand on non-tariff barriers, the Indian prime minister withdrew from RCEP on 4 November, during the summit meeting in Bangkok.
India's key demands included the imposition of an import surge trigger so that Chinese goods don't flood the Indian market and opening market access for Indian exports to China.
After India's withdrawal, Japan urged India to reconsider its decision to pull out of the RCEP. India, however, is of the view that it needs to correct its trade deficit.
India is already making efforts in that direction, by renegotiating its free trade agreements with other Asian and south-east Asian nations. It is now holding negotiations with South Korea and will begin trade negotiations with Japan soon.
