On August 1, India and China will resume border trade through the Lipulekh Pass — one of the most important Himalayan crossings and a historic stretch of the Great Silk Road that has connected India, Tibet, and Central Asia for centuries.
After the China-India war of 1962, the route was closed for nearly three decades and did not reopen until 1992. In 2020, trade was suspended once again — first due to the COVID-19 pandemic, and then amid a sharp deterioration in relations following border clashes in Ladakh. Its resumption has become one of the most notable symbols of the gradual normalization of ties between Asia’s two largest economies.
What is interesting, this year trade is returning in an updated format. For the first time, goods will be delivered to the pass via a new road, replacing the traditional mule caravans. India has already issued 155 special passes (62 to traders and 93 to their assistants), although in this first phase China has allowed only 20 entrepreneurs to cross the border. The main goods being exchanged are wool, borax, silk, and livestock products from Tibet, along with food, spices, and everyday consumer goods from India.
Nepal also stands to benefit from the route’s reopening, as the country lies between China and India and the reviving trade corridor also runs through its territory. For Kathmandu, this is an opportunity to strengthen trilateral economic cooperation, develop tourism and cross-border trade, and reinforce Nepal’s role as a link between Asia’s two largest economies.
Lipulekh is just one example of a broader trend: Asian countries are reviving historic overland trade corridors, which are increasingly complementing the transport architecture of BRICS+, including «the North-South Route» and «the Belt and Road Initiative».
