India-China Border Trade: A Case Study of Sikkim’s Nathu La

Eram Fatma

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Border trade between India and China was closed shortly before the India-China war of 1962. The growing tensions between the two countries due to border issues along with India’s stand to give refuge to the Dalai Lama added fuel to fire. There was about a decade and a half long Cold War like situation that existed between the two countries. Relations began to normalise from the mid-1970’s. On 16 December 1991, India and China signed a memorandum of understanding on resumption of Border Trade. It was decided initially it would be carried out at one point across the Uttar Pradesh-Tibet border through the Lipulekh pass. This was followed by the reopening of Border Trade in 1992. Two years down the line a second trading point was reopened across Himachal Pradesh-Tibet border through the Shipki La. Later in 2006, Nathu La pass was reopened in Sikkim as per the agreement signed between India and China in 2003.

In the decade that has followed, few of the expectations that the people in the Sikkim region had from the opening of this route has materialised. This work deals primarily with the nature of the border trade across the Nathu La, the expectations the people had from it, and humble for suggestions for attaining them.

Eram Fatma Eram Fatma did her M.Phil, in Foreign Policy from the Institute of Foreign Policy Studies, Calcutta University. She was a fellow at the Centre for Studies on China and Her Neighbourhood. She is presently a guest faculty for economics at the Sri Sikshayatan College, Calcutta.



1. China and India Commodity Trade (1991-2011)
2. East Sikkim: District Profile
3. India-China Border Trade Story-Pre 1962 War
4. Case Study of Nathu La Border Trade: Current Scenario



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