A cautious reset in India-China relations is taking root, according to analysts, with the two rivals increasingly walling off their border disputes from expanding cooperation on trade, security and multilateral diplomacy.

The clearest marker yet came last week in New Delhi, where the two sides held their first-ever bilateral consultations focused exclusively on the Shanghai Cooperation Organisation (SCO), the Eurasian security bloc that also includes Russia, Iran, Pakistan and four Central Asian states.

The two-day meeting was led by Alok Amitabh Dimri, India’s SCO national coordinator, and his Chinese counterpart Yan Wenbin. It is being read as the latest institutional step in a wider diplomatic reset that began in 2024 with the disengagement of Indian and Chinese troops from key friction points such as Depsang and Demchok along the Line of Actual Control, the two countries’ disputed 3,500km (2,175-mile) Himalayan border.

Atul Kumar, a fellow at the Delhi-based Observer Research Foundation’s strategic studies programme, said the SCO bilateral meeting signalled a compartmentalisation of India-China ties, with border disputes being decoupled from multilateral cooperation.

He said this shift allowed Delhi to engage in Eurasian security and trade talks without ceding ground to Beijing or Islamabad, even as it maintained its military posture along the border.

“While India refuses to endorse the Belt and Road Initiative, it remains keen on other cooperative avenues,” Kumar said. “Both nations are increasingly viewing a less hostile relationship as a hedge against Washington’s regional unpredictability.”

According to India’s Ministry of External Affairs, the two sides exchanged views on the implementation of SCO leaders’ decisions and the organisation’s future course, reviewed cooperation on security, trade, connectivity and people-to-people ties, and agreed to continue consultations.