Xi-Modi talks attracting attention as BRICS gets into full swing

The BRICS summit begins tomorrow in India, and the meeting between Chinese President Xi Jinping and Indian Prime Minister Narendra Modi will be one of the most-watched events.

The Chinese government confirmed Xi’s attendance at the event on Thursday. This will be the first visit by a Chinese president to India since 2019, and since relations soured following deadly border clashes in 2020.

“This is a really important moment,” Brinda Sahay, a research analyst at Carnegie India’s Security Studies Program, told CNBC. “This is a great opportunity to use the BRICS summit as an excuse to hold substantive bilateral talks.”

The meeting comes amid thawing in relations between New Delhi and Beijing, and follows Modi’s visit to China for a South African summit last year, although border disputes and trade imbalances remain a sticking point between the two countries.

The border dispute between New Delhi and Beijing is expected to be on the agenda, but the issue dates back decades and led to the two countries going to war in 1962.

Relations between the two countries have significantly improved over the past year, although the conflict in 2020 sent relations into a deep freeze.

“The meeting between Prime Minister Modi and Mr. Xi is likely to further the ongoing reset of bilateral relations and build trust. The meeting between China’s foreign minister and India’s national security adviser in August made significant progress on the long-standing border dispute,” Chatham House senior South Asia fellow Chietigi Vajpayee said in an article earlier this week.

Chinese Foreign Minister Wang Yi and Indian National Security Adviser Ajit Doval met in August and “expressed satisfaction with the steady resumption of people-to-people and cross-border exchanges,” including border trade and pilgrimages through Himalayan passes.

In a sign of improving relations, India and China have resumed direct flights and New Delhi has eased restrictions on Chinese investment in India.

New Delhi’s rapprochement with China comes as relations with the second Trump administration have been strained over trade and tariffs, leading to India’s aggressive investments in other ties.

Prime Minister Modi and President Xi met in Kyrgyzstan last week on the sidelines of the Shanghai Cooperation Organization and, along with Russian President Vladimir Putin and other members, signed the Bishkek Declaration condemning the military attack on Iran without naming the United States.

Experts previously told CNBC that they expect New Delhi to use its presence at the SCO and BRICS summits to highlight the strength of multipolar cooperation. The 11 member states include Iran, and President Massoud Pezeshkian is also expected to attend the summit.

“The Indian government’s recent actions confirm India’s continued commitment to strategic hedging,” Vajpayee said. He pointed to resource deals the country has signed with Australia, Indonesia and Uzbekistan, as well as trade deals with the UK and the European Union.

But in a sign that mistrust between India and China persists despite the thaw in relations, Beijing reportedly denied Indian military access to key patrol posts and invaded land in India’s northeastern border state of Arunachal Pradesh in August.

Carnegie India’s Sahay said it was important for observers to manage expectations.

“[BRICS]is a group that was born to bring about reforms in the existing financial and global governance structures. It is not aimed at solving geopolitical problems… It is confused with the border issue between Russia and China, which is not what the group is trying to solve,” she pointed out.

Trade between the two countries is also expected to be an important topic, especially for New Delhi.

India has a huge trade deficit with China and has relied on exports from the world’s second-largest economy.

China is India’s largest business partner, with total trade totaling $151.1 billion in the year ending March 2026, a record high. However, New Delhi’s deficit with China has also increased to a record high from $99.21 billion to $112.16 billion.

Last year, India asked members at the BRICS summit to address trade imbalances with New Delhi, and market access to address those distortions is expected to be on the agenda this year.

As for the Chinese government, India is particularly vulnerable because of its dependence on Chinese goods to fuel its domestic sector. For example, India’s push for green energy infrastructure relies primarily on Chinese batteries, giving Beijing the power to crush New Delhi’s ambitions.

China is reportedly using rare earth export controls as leverage against the United States, taking steps that are detrimental to India’s growth, with India’s prominent think tank Observer Research Foundation calling this a “national security challenge.”

New Delhi has also imposed trade restrictions on China in areas where India is close to self-sufficient, such as aluminum foil and electrical steel sheets. Meanwhile, China is wary of technology transfers to India, saying it could undermine Beijing’s role in key global supply chains.

For example, India has already emerged as a major supplier of Apple’s smartphones since the company started diversifying its manufacturing base away from China. According to the Indian government, the country is already the world’s second-largest mobile phone maker. According to multiple media outlets, China banned engineers and equipment from entering the country last year, disrupting iPhone production.

So while potential investment ties will be viewed positively, foreign direct investment liberalization between the two countries “will proceed cautiously, with guardrails remaining closely tied to geopolitical developments,” said Radhika Rao, senior economist at DBS Bank.

Reuters reported last month that Xi would visit India with a delegation of about 400 officials, more than double the size of the 2019 delegation.

— CNBC’s Priyanka Salve contributed to this report.