Vajpayee met President Hu Jintao on May 31 on the sidelines of the ceremony marking the 300th anniversary of the Russian city of St Petersburg. They also met the following day at the South-North leaders' informal dialogue meeting in the French resort of Evian.

China and India have a combined population that accounts for one-third of that of the world, and their shared border runs for 2,000 kilometres. A steadily improving relationship between the two Asian neighbours will have a positive and far-sighted influence on regional and world peace and stability.

Sun Shihai, deputy director with the Institute of Asia-Pacific Studies of the Chinese Academy of Social Sciences, said: "Under the current complex and volatile international situation, this visit - to which both countries have attached great importance - will write a new chapter in Sino-Indian bilateral ties. It will promote a constructive partnership between the two Asian giants by adopting more mature and pragmatic approaches."

The Chinese leadership and Vajpayee are expected to discuss issues ranging from economic co-operation to co-operation in combating global terrorism, the need for multilateralism and other important international and regional issues. The in-depth talks will undoubtedly further mutual understanding and trust and give new impetus to their ties.

Shivshankar Menon, India's ambassador to China, told China Daily that Vajpayee's visit "is taking place within a context of continually improving India-China relations and will provide an opportunity for both sides to push these relations forward."

Sino-Indian relations have seen ups and downs over the past decades. According to Cheng Ruisheng, a former Chinese ambassador to New Delhi, the boundary clash in 1962 led to mutual distrust. As a result, bilateral relations remained stagnant until then Indian Foreign Minister Vajpayee visited China in 1979.

High-level exchanges have since resumed, with Indian Prime Minister Rajiv Gandhi visiting Beijing in 1988.

Though Sino-Indian relations turned sour briefly due to New Delhi's nuclear tests in May 1998, mutual understanding was enhanced and a mechanism for dialogue on security was set up in 1999.

Last year, then Premier Zhu Rongji paid an official visit to India, where he said that the two countries should shoulder key responsibilities to maintain peace and stability in Asia.

The positive development of Sino-Indian relations can largely be attributed to changes in the world situation since the end of the Cold War, which saw the emphasis in international relations shift from politics to economics, according to Sun.

As the two largest developing nations, both China and India need a peaceful international environment that is favourable for their own economic development, Sun noted.

The convergence of their strategic objectives and interests has served as a catalyst for bringing the two Asian nations closer.

In an increasingly globalized world economy, economic interests are the driving force in bilateral ties and the vital element that both sides have to take into consideration when handling bilateral issues.

Menon said: "As two of the fastest-growing large economies in the world, India and China are rapidly transforming the lives of their people and share a common interest in this task."

He added that "the process of development in each country has led to increasing complementarities" between China and India and therefore to "increasing opportunities to co-operate in various economic fields."

According to Yang Baojun, deputy director with Peking University's Centre of Asia-Pacific Studies, bilateral trade last year reached US$5 billion, 2.5 times the amount in 1998. The trade volume in the first quarter of this year increased by 70 per cent compared with the same period last year.

Wang Hongwei, a researcher with the Institute of Asia-Pacific Studies of the Chinese Academy of Social Sciences, said that, in the long run, "China's development offers an opportunity rather than a threat to India."

What truly matters now for the two countries is a shared political will to anchor bilateral ties. A constructive Sino-Indian partnership would conform more to their respective political and security interests than a relationship as rivals.

The international situation after September 11, 2001, has also provided both countries with new ground for co-operation in the fight against terrorism.

China has adopted a consistent good-neighbourly policy to create a peaceful and stable environment for its ongoing development.

Sun said: "From China's viewpoint, a stable South Asia is in the interests of all the relevant parties, and a benign Sino-Indian relationship can contribute to regional stability."

Indian Ambassador Menon noted that Beijing and New Delhi "have similar approaches to most international questions and are engaged in a wide-ranging political dialogue on strategic issues, counter-terrorism, policy planning and other issues of mutual interest." This makes it more desirable for both to further develop their political understanding, he added.

Wang said Vajpayee's visit - following Indian Defence Minister George Fernandes' tour in April when the SARS epidemic was rampant - marked a significant change in Indian security policy.

Hua Junduo, China's ambassador to India, said inadequate mutual understanding is the major obstacle to the growth of Sino-Indian relations, although their common interests are far greater than the problems left over by history.

Hence, increasing bilateral exchanges - particularly at high levels - will undoubtedly help enhance mutual understanding.

The two countries have been working hard to build confidence since the 1990s.

Their Joint Working Group on the border issue has been meeting periodically. It worked out the 1993 Sino-Indian agreement on the maintenance of peace along the Line of Actual Control. In 1996, then President Jiang Zemin visited India, during which the two countries signed an agreement on military confidence-building measures along the winding border.

Divergence is inevitable in inter-state relations. In maintaining a sound relationship where differences exist, the most productive approach is to let common interests prevail.