India and China on Thursday set a bilateral trade target of $100 billion by 2015, with more exports from New Delhi to cut deficit, and agreed to enter into a strategic economic dialogue to enhance cooperation.
The Asian giants also set up an India-China Chief Executive Officers Forum to deliberate on business issues and make recommendations on the expansion of trade and investment cooperation.
"There is enough space in the world for the development of both India and China and indeed enough areas for India and China to cooperate," said a communique here after talks between Prime Minister Manmohan Singh and his Chinese counterpart Wen Jiabao.
"The two sides welcome each other's peaceful development and regard it as a mutually reinforcing process. They believe their growing relationship offers increasing opportunities to advance their cooperation," it said.
"The two sides agreed to take measures to promote greater Indian exports to China with a view to reduce India's trade deficit," it said, referring to the balance of trade that is skewed in China's favour and seen at $24 billion this fiscal.
The India-China bilateral trade stood at $51 billion last fiscal and is expected to top $60 billion this year, expanding from $15 billion in 2005.
But China, India's largest trade partner, enjoyed a surplus of $19 billion last fiscal, up from under $1 billion in 2002.
This has been a sore point with the Indian side, particularly since it is seen further widening to $24 billion this year. India has been hoping for China to open up its economy for more exports from here.
The two sides also agreed to expand economic cooperation, especially in infrastructure, environmental protection, IT, telecommunications, investment and finance.
India welcomed Chinese investments in infrastructure sector.
"They agreed to encourage greater mutual investment and project-contracting cooperation between businesses of the two sides, appropriately handle economic and trade frictions and differences and jointly oppose protectionism in all forms," said the communique.
The two sides also decided to increase cooperation between the Reserve Bank of India and China Banking Regulatory Commission, while agreeing to extend permission to their banks to open branches and representative offices in the other country.
"Modalities will be worked out by the concerned authorities," the communique said.
The premiers welcomed the opening of a telephone hotline between them, agreed on regular talks on important issues and oversaw the signing of six pacts including one on green technologies.
These came on top of some 50 deals worth $16 billion entered into between enterprises of the two sides on Wednesday to coincide with Wen's visit. He is here with a 400-member strong business delegation.