The leaders of China and India met for their second informal summit on Oct. 11 and 12, a follow-up to their April 2018 meeting in Wuhan in central China. Chinese President Xi Jinping and Indian Prime Minister Narendra Modi gathered in India this time, holding several hours of talks in the coastal town of Mamallapuram.

The backstory to the initial meeting was a two-month standoff between the Indian and the Chinese military in the summer of 2017 at Doklam, their worst military crisis in recent memory. By conducting these informal summits, the two countries expect that Modi and Xi could bring to bear the influence of their strong personalities on improving Sino-Indian relations.

What have Modi and Xi achieved in these meetings? Here are four takeaways.

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1. There’s little progress on the Sino-Indian border dispute

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Since the Sino-Indian border war of 1962, China and India have disputed 2,500 miles of undefined Himalayan frontier. In the early 1980s, the two nations began negotiating the border dispute, but 21 rounds of negotiations have not yielded any concrete results.

Border tensions have escalated — Doklam was the most intense crisis to date. For 70 days, Indian and Chinese soldiers stood eyeball to eyeball at 14,000 feet in the high Himalayas. Though neither side fired a single shot, there was a high chance of escalation.

Doklam provided an impetus for intervention by the two leaders, paving the way for informal summits such as Wuhan. However, military forces from each side continue to run into each other along the undefined border. Just last month, the Indian Army and the People’s Liberation Army were involved in another scuffle in India’s north, and it took high-level delegation talks to disengage the two sides.

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The recent Modi-Xi summit failed to produce any border breakthroughs. China’s growing military power across the border — with major amassment of firepower and improvement in military logistics — continues to make New Delhi extremely jittery.

2. India and China seemed to overcome tensions regarding Kashmir and Pakistan

In August, the Modi government revoked the autonomy of Jammu and Kashmir, a region administered by India since 1954. This region forms the border with both Pakistan and China. Modi’s controversial move rattled both China and its longtime ally Pakistan.

Though Beijing’s concern initially focused on ensuring that India’s actions do not alter the status quo of the Sino-Indian border, it quickly rallied around Pakistan’s claims that Modi’s decision was both illegal and illegitimate. China pushed the U.N. Security Council to discuss Kashmir in a closed-door meeting.

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Just before Xi’s visit to India, Pakistani Prime Minister Imran Khan visited Beijing. During the visit, Xi reiterated China’s support to Pakistan on Kashmir, casting a shadow on the Modi-Xi summit.

Such negative optics notwithstanding, Modi and Xi managed to reach a tentative understanding on Kashmir. In early October, China’s envoy to India declared that Kashmir was a bilateral dispute between India and Pakistan, to be resolved by the two sides through negotiations. This was a significant change in Beijing’s position. New Delhi unequivocally communicated to Beijing that revocation of Kashmir’s autonomy doesn’t change the status quo on the Sino-Indian border, addressing China’s primary concern about what happened in Kashmir.

A preliminary test of this Modi-Xi understanding took place in Paris last week. After the Wuhan summit, New Delhi was able to persuade China not to veto Pakistan’s “grey-listing” by the Financial Action Task Force (FATF), an intergovernmental agency overlooking terrorism financing. On Oct. 18, the FATF reviewed Pakistan’s performance on its anti-terror guidelines. Though New Delhi was concerned that the Chinese presidency of the FATF might result in a lenient verdict, the agency found Pakistan lacking in compliance. It also issued a stern warning to Islamabad to either fulfill its commitments or face “blacklisting” by the agency. Any further downgrading by the FATF would imperil Pakistan’s already precarious economy.

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3. China and India found common ground on trade

India has often complained about China’s protectionist trade policies. President Trump’s trade wars give India and China new reasons to resolve their bilateral trade differences and boost trade between the two countries, as a way to offset losses from protectionist U.S. trade policies. But there are politically sensitive issues like Huawei’s investment interest in India — and India’s reluctance to join the China-led Regional Comprehensive Economic Partnership (RCEP).

On trade, Modi is coming around to the idea of joining the RCEP — despite domestic concerns that lower tariffs would put India’s industrial sectors at risk from Chinese imports. He probably realizes that India cannot ignore Asia’s most significant free trade agreement, given the recession at home and difficulties securing a U.S. trade agreement. There’s also the hope of bargaining for greater access to Chinese markets for Indian manufacturers through RCEP negotiations.

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The question of Huawei’s investments in India’s technological infrastructure — especially 5G equipment — will be a tough problem to resolve, however. Chinese authorities have publicly warned India of “reverse sanctions” if New Delhi follows the lead of its Western partners in shunning Huawei.

But there’s also pressure from Sen. Ted Cruz (R-Tex.), whose visit to India coincided with the Modi-Xi summit. Cruz warned of U.S. concerns about intelligence sharing if Huawei is part of India’s 5G infrastructure. However, in the absence of any viable alternatives, India may be forced to do business with Huawei.

4. India will not participate in China’s Belt and Road Initiative

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New Delhi is also concerned about Xi Jinping’s Belt and Road Initiative (BRI). India has refused China’s repeated invitations to join the initiative primarily because BRI’s flagship project — the China-Pakistan Economic Corridor (CPEC) — passes through the Pakistan-Administered Kashmir, a disputed territory that New Delhi claims as its own. The Modi-Xi summit failed to break the deadlock on the BRI.

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Looking ahead

How India and China resolve their differences will not only define the bilateral relationship but also have significant implications for U.S. foreign policy. If Chinese actions in the region continue to arouse Indian concerns, New Delhi may look for U.S. assistance in balancing against Beijing — an outcome that China will try hard to avoid. It’s these pushes and pulls within the Sino-Indian-U.S. strategic triad that will influence Asia’s balance of power.

Yogesh Joshi is a research fellow at the Institute of South Asian Studies, National University of Singapore.

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