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Significance

India and China, strategic rivals, have only partly disengaged from the border stand-off in the western Himalayas which began in May 2020, despite several rounds of talks aimed at resolving the situation. India-China trade is growing, but Chinese foreign direct investment (FDI) in India is stagnating.

Impacts

Chinese tech investors will divert funds from India to South-east Asia and Africa.

India will struggle to reduce its trade deficit with China sizeably.

Both countries will step up development of transport and surveillance infrastructure at the border.

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