The visit will also be significant against the backdrop of America’s occupation with the war with Iran, the report adds. With Chinese Foreign Minister Wang Yi and India’s top officials, including National Security Adviser Ajit Doval and External Affairs Minister S. Jaishankar leading the engagement, the two sides have been gradually rebuilding ties.
The report also gives data supporting the thaw in ties. According to Chinese customs data, trade between China and India rose 12.4 percent last year to a record $155 billion, more than double the $71.6 billion recorded a decade earlier. In the first seven months of this year, bilateral trade increased by 23 percent compared with the same period last year.
Chinese companies are showing growing interest in investing in India, with activity picking up over the past 18 months, according to the report. Firms across the technology and energy sectors have been exploring potential opportunities in the Indian market, including cleantech company Envision, Geely-backed engine maker Horse Powertrain and battery manufacturer CosMX, the report adds.
In March this year, the Indian government also eased scrutiny of Chinese investments in India’s solar energy and electronics industries. Based on the proposed changes to foreign investment rules, Chinese companies would now be able to invest up to 10 percent in Indian firms without seeking prior government approval, as long as the investment does not give them control.
The report also highlights several signs of improving economic and people-to-people ties. The two countries have resumed direct flights for the first time since 2020, while border trade has restarted at three Himalayan crossings. They have also jointly organised a Hindu-Buddhist pilgrimage to sacred sites in Tibet.
Praveen Donthi, senior analyst with Crisis Group, called it a “cautious reengagement”. He told FT that recent engagements bring the two countries back to “regional rivalry dressed up as competition and co-operation”.
The report says, “Beijing appears hopeful that India can be pulled further from American influence while also offering China’s slowing economy a large potential market for its companies.”
Meanwhile, as bond yields rise globally, The Economist turns to India to attempt to explain what is driving the sell-off and what the country’s experience reveals about the health of government debt markets.
The column presents two reasons worth exploring: First, that governments are borrowing and spending too much, raising concerns about inflation and weakening confidence in economic institutions.
The other, put forward by US Treasury Secretary Scott Bessent, is that investors expect stronger long-term growth, particularly from the AI boom, which is driving huge demand for capital to build data centres and power infrastructure. The column finds India’s case to be supporting the Bessent argument.
While the yield on 10-year US government bonds has risen by 0.67 percentage points this year to 4.8 percent, the yield on equivalent Indian government securities has increased by 0.37 points to 7 percent. “That spread remains near historic lows. Whatever is causing bond yields to spike is having less of an effect on the world’s largest democracy than on its oldest one. Why?” The Economist asks.
This is despite India’s strong economic growth, with GDP expanding 7.8 percent year on year in the second quarter, following 8.6 percent growth in the previous three months, the column adds.
The column argues that India’s experience suggests rising bond yields cannot be explained by growth alone. India’s inflation has averaged 4.6 percent over the past decade, compared with 8.1 percent in the previous decade, while its primary fiscal deficit has fallen below 2 percent.
However, The Economist makes it clear why India’s bond market is less vulnerable to sudden sell-offs. Most government bonds are held by domestic institutions such as banks, insurers and pension funds. Foreign investors own only around 3 percent of government securities, meaning India faces lower risk of large amounts of foreign money suddenly leaving the market.
The Economist argues that rich countries should not try to control bond yields by intervening in the market. “India’s experience shows the importance of cleaning up public finances and letting central bankers fight inflation in peace.”
India’s case, the column notes, shows that institutions matter when it comes to regulating bond sell-off and yields.
In a related report, The Economist looks at the loss-making traders of India and regulators’ attempts to protect them.
A study by the Securities and Exchange Board of India (SEBI), found that nine of 10 traders lose money, with the average trader losing about $1,400 a year, a significant amount by Indian standards.
In several failed measures, SEBI has sought to curb inexperienced traders by increasing the minimum contract size, preventing brokers from extending credit and introducing other restrictions, the column notes. “It has also targeted market-makers it sees as taking advantage of unsophisticated patsies.”
SEBI has pursued a case against Jane Street, an American hedge fund, which it accuses of market manipulation. However, the column argues that the board’s attempts may have “gone too far”.
It is unclear whether the auctions can keep manipulators at bay, the column adds, but they are creating problems for options traders. Since traders can see only their own bids and offers, market-makers, who rely on the publicly visible gap between the two, often choose to stay out. “Without their liquidity, trading is thin and volatile.”
Seong Hyeon Choi of the South China Morning Post reports on the latest addition to Pakistani air defence: A Chinese-made short-range HQ-17AE Shorad system.
“Pakistan has unveiled a newly acquired Chinese-made short-range air defence system that analysts say could boost its ability to counter Indian drones and low-altitude threats in a future conflict,” Seong writes.
A video posted by the Pakistan Air Force (PAF) Sunday confirmed for the first time that it operates China’s HQ-17AE short-range air defence (SHORAD) system, adds the report.
The HQ-17AE is China’s export version of the HQ-17A air defence system. It is a wheeled version of the original HQ-17, which was developed by reverse-engineering Russia’s Tor-M1 missile system.
The report notes that the system can intercept targets at distances of up to 20 km and at altitudes of around 10 km. It is built to protect against a range of low-flying threats, including drones, helicopters, cruise missiles, guided weapons and aircraft.
“These systems are part of Pakistan’s new layered integrated air defence system designed to counter a range of modern aerial threats, including drone swarms,” the report says.
China is Pakistan’s biggest source of arms. Data from the Stockholm International Peace Research Institute showed that Chinese weapons made up about 80 percent of Pakistan’s total arms imports between 2021 and 2025, Seong adds.
Chinese-made military equipment, he adds, was central to Pakistan’s operations during its brief border conflict with India last year. Pakistan said a Chinese-made J-10CE fighter was used to shoot down an Indian Rafale.
Despite Indian government ordering Meta to remove all ads and content promoting child sexual abuse material (CSAM) on Instagram, Meta continues to run such ads on social media, the BBC reports.
Diyva Arya writes, citing a Tech Transparency Project (TTP), 332 adverts with CSAM ran on Facebook and Instagram, and the majority of them (274) are from August this year.
“We don’t tolerate nudity apps or any kind of child exploitation, whether real or AI-generated. These criminals constantly shift tactics to evade detection, which is why we keep strengthening our detection and enforcement,” Meta told the BBC.
The TTP report published Tuesday found that several ads used real photos of children, including a member of a European royal family, which were altered using AI. More than a dozen of these ads reportedly remained on Meta’s platforms even after TTP alerted the company to its findings, Arya writes. And about of quarter of those, 84 ads, were run in India.
(Edited by Viny Mishra)
