China and India reopened cross-border trade through the Lipulekh Pass in the Himalayas last week, marking a tentative step toward easing tensions between the two nations. The pass, located near the contested tri-junction of India, China, and Nepal, had been closed for six years. The first group of 26 Indian traders from Uttarakhand crossed into the Taklakot market in Purang county, Tibet, on June 26. This route serves as an important access point for Indian pilgrims visiting the sacred Mount Kailash and Lake Manasarovar in Tibet’s Ngari prefecture. Additional crossings are planned during the seasonal window extending through September.

The reopening followed the recent visit of Chinese Foreign Minister Wang Yi to New Delhi, reflecting signals of cautious diplomatic engagement. Analysts described the move as a goodwill gesture by Beijing, though they cautioned that underlying border disputes and strategic rivalry between the two countries remain unresolved. Wang Yi characterized India and China as “partners, not rivals,” and noted that bilateral relations were “gradually... returning to the track of recovery and improvement.” His meetings with Indian Prime Minister Narendra Modi and national security adviser Ajit Doval preceded the resumption of trade at the pass.

Lipulekh, situated at an altitude of over 5,300 meters, is one of three official India-China border trade points, alongside Shipki La Pass in Himachal Pradesh and Nathu La Pass in Sikkim. All were suspended after the outbreak of the COVID-19 pandemic and the violent 2020 clash in the Galwan Valley, where 20 Indian and at least four Chinese soldiers were killed. In 2023, the two governments agreed to reopen these crossings to stabilise bilateral ties following a meeting between President Xi Jinping and Prime Minister Modi at the BRICS summit in Russia.

Experts view the reopening as a pragmatic rather than transformative step. Wang Dehua, an India specialist at the Shanghai Municipal Centre for International Studies, said it represents progress in managing Tibet-related issues and carries symbolic significance for religious pilgrimage, which spans Buddhism, Hinduism, and Tibetan Buddhism. However, he expressed skepticism about long-term prospects, pointing to ongoing disputes such as India’s criticism of China’s Medog hydropower project on the Yarlung Tsangpo river.

The issue is further complicated by Nepal’s longstanding territorial claims, including on the Lipulekh Pass area. Nepal has formally protested agreements made by India and China without its consultation and insists its sovereignty must be respected. India’s foreign ministry dismissed Nepal’s claims as lacking historical basis, maintaining that reopening the pass follows historical precedent. Meanwhile, China has refrained from taking a direct stance, calling on India and Nepal to resolve the dispute through dialogue.

Liu Zongyi, a senior fellow at the Shanghai Institutes for International Studies, described the gesture as largely unilateral from China and noted it does not signify recognition of India’s territorial claims. He also suggested that Beijing’s move aims to maintain a peaceful border and enhance cross-border trade while subtly supporting the Modi government domestically. Liu further observed that China hopes improved ties may facilitate a potential visit by President Xi Jinping to India during the upcoming BRICS summit in September.

Overall, while the reopening of the Lipulekh Pass signals a thaw in bilateral relations, longstanding territorial disputes and regional dynamics continue to pose challenges to a durable strategic rapprochement.