Billed as a visit aimed at consolidation of the much improved Sino-Indian ties after last year's spat on Arunachal Pradesh, Krishna will have a hectic schedule for the next two days which include talks with his Chinese counterpart Yang Jiechi followed by Prime Minister Wen Jiabao.

Besides attending a civic reception, he would formally kick off six-month-long celebrations to mark the 60th year of establishment of diplomatic ties between the two countries.
While the two sides attach a great deal of importance on the substantive issues that would come for discussion, officials of both sides said that the tone and tenor of the dialogue would be based on common perception.

The general feeling in both the countries is that the tensions arising out of Chinese statements over Arunachal Pradesh, subsequent visit of Dalai Lama there, the adverse reports in the media in both the countries have not benefitted either of the countries, Indian officials here told reporters.

The entire gamut of bilateral issues will be taken up, including the boundary issue, "illegal" construction by Chinese companies in PoK and China issuing stapled visas to those hailing from Jammu and Kashmir, a Ministry of External Affairs spokesman said in New Delhi yesterday.

India has been maintaining that any construction in PoK by China was "illegal". This has been conveyed to China at every level as it was a matter of "core concern" to the country, another Indian official said.

China regards Krishna's patient approach during last year's spat provided a "calming influence" on the bilateral ties during the 2009, Indian diplomats said here.
With the bilateral trade touching USD 60 billion and the two economies recovering from global recession, there is strong interest among both the governments not to see a repeat of the 2009 phase, they said.

The underlining sentiment in both countries ahead of Krishna's visit to Beijing is to take the relationship forward and ensure that the sentiment remained upbeat and positive, they said.

Also, though the trade between the two flourished, despite last year's dip, India is deeply concerned about mounting trade deficit.In 2008, bilateral trade was estimated at USD 52 billion and in 2009, despite the global economic slowdown, at USD 44 billion.    The first two months of 2010 have shown 55 per cent increase as compared to the previous year. "The two countries have set for themselves a turnover target of USD 60 billion for 2010," Indian Ambassador to China S Jaishankar said.

In the last two months this year, the Indian exports touched to USD 3.49 billion against China's USD 5.49 billion.Indian officials appear happy that China has come forward to address India's trade concerns with a promise to open its markets to Indian IT, Pharmaceuticals, Engineering services and Agro products.

Also concerted efforts are being made by Indian officials and Industry to give a major push to these products in Chinese markets with special campaigns.
Ahead of the talks, Chinese officials have also hinted that Beijing would be pressing for a Free Trade Treaty between the two as talks were underway for some time.
India, however, appeared diffident as about 70 per cent of its exports to China are made of raw materials like iron ore which are coming back to the country from China as higher value finished goods posing a major competition to India's small and medium-sized businesses.

The two sides also expected to firm up their cooperation on the climate change, the international financial crises and the Doha Round of trade talks and steps needed to enhance military-to-military cooperation.

Krishna was also expected to take up the arrest of 21 diamond dealers from Gujarat who were held few months ago in Shenzhen city on charges of smuggling.
China has provided consular services but there was no word about their fate.
Krishna's visit was also a prelude to the visit of President Pratibha Patil here later this year followed by Chinese leaders visit to India.

Krishna will be assisted during the talks by Foreign Secretary Nirupama Rao, Joint Secretary (East) Guatam Bambawale and Ambassador S Jaishankar.