Diplomats on both sides breathed easy after resolving differences over China`s practice of issuing visas on a piece of paper to residents of Jammu and Kashmir, which had prompted New Delhi to put on hold defence exchanges.
China had resorted to this practice on the ground that Jammu and Kashmir was a disputed territory. India took strong exception, saying it infringed on its sovereignty and also amounted to China altering its long-standing policy to stay neutral on the Kashmir issue.
It was finally sorted out in 2011 after China quietly stopped the practice, prompting India to resume defence ties after a year-long hiatus.
However, the two countries witnessed fresh problems as they had to put off the 15th round of boundary talks in New Delhi last month over China`s objections to the Dalai Lama`s participation in a Buddhist conference which had taken place around the same time.
The talks could not be held on November 28-29 as scheduled and efforts were on to organise them next month to begin the New Year on a positive note.
Meanwhile, the two sides held their second defence dialogue in New Delhi this month in which Deputy Chief of People`s Liberation Army (PLA) Gen Ma Xiaotian took part.
India and China are also expected to hold joint military drills next year.