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Forty four years ago Nathu La, part of the famed Silk Road, located 4,400 meters (14,520-feet) above sea level, had been closed after a brief Indo China war in 1962. On June 18, 2006 China and India agreed to resume frontier trade from July 6, 2006.

A Chinese (R) and Indian (L) soldier at the Nathu La Pass
© AFP/File

Officials from both sides signed an agreement Sunday June 18 in Lhasa, the capital of the Chinese region of Tibet, to reopen the Nathu La Pass on July 6, the official Xinhua news agency said.

Nathu La, part of the famed Silk Road and located 4,400 meters (14,520-feet) above sea level, has been closed since a brief war broke out between China and India in 1962. Both the countries agreed in June 2003 to open the pass following a historic visit to Beijing by then-Indian prime minister Atal Bihari Vajpayee.

Indian government officials said last week they were sending a delegation to Lhasa in the expectation of signing the final agreement.

The reopening of the pass, which used to be an important land transport route between China and India, is expected to have a significant impact on trade between the two countries, Xinhua said. It will also help Tibet's economic development, it said, and coincides with the July 1 start of the first train line into the region from eastern China.

"The reopening of border trade will help end economic isolation in this area," Xinhua quoted Tibet government vice chairman Hao Peng as saying. "It will also ... pave the way for a major trade route that connects China and South Asia."

India and China -- the world's most populous countries -- have pushed for greater trade to tap a total consumer market of 2.3 billion people. Bilateral trade reached 18.73 billion dollars in 2005, up 37.5 percent, according to Chinese statistics cited by Xinhua.

Trade between the two countries currently relies mostly on sea transport and is largely seen as very modest, if growing, compared to flows with their other trade partners.

Chinese exports to India will include wool, herbs and electrical appliances while Indian exports are expected to include iron ore and farm products, it said.

The opening of the old trade route comes amid a warming of relations between the two nations although their border dispute -- the cause of the 1962 war -- has still not been totally resolved. Both sides agreed in May last year that previously disputed Sikkim belonged to India and said they would work to resolve other border issues.

India says China occupies 38,000 square kilometers (14,670 square miles) of Indian territory while Beijing has claims on the remote Indian state of Arunachal Pradesh.

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