Cross-border trade between Tibet and India has risen by more than 10 times since the opening of the Nathu La Pass in Sikkim in 2006, a Chinese official said this week.

The regional government now plans to boost investment to spur overland trade with India and Nepal, as a way to bring development to parts of western China that have been left out of the country's growth story.

Cross-border trade in Tibet was up 88 per cent year on year as of August, though driven more by trade with Nepal which accounted for 95 per cent of total trade. Trade with Sikkim made up the rest. Overall, Tibet reported $254 million of border trade in the first eight months of this year.

Su Yuanming, an official at the regional commerce department of the Tibet Autonomous Region (TAR) government, told the official Xinhua news agency the government would invest more in boosting cross-border trade. “Such cross-border cooperation [with India and Nepal] is conducive to Tibet’s economic development and the overall growth of China’s underdeveloped western regions,” he said.

Mr. Su said more businesspeople had invested in Tibet following increased economic cooperation with India and Nepal.

Trade across the Sikkim border reached 16.3 million yuan ($2.44 million) in 2009,
more than a ten-fold increase from 2006. The reopening of the Nathu La Pass between Sikkim and Yadong county in Xigaze (Shigatse in Tibetan) was the reason behind the growth, he said.

China’s western regions, including Tibet, Xinjiang and southwestern Yunnan, have lagged behind the
more prosperous east in development.

Since 2000, the government has invested in a “Go West” drive to boost infrastructure.
Building highways and border roads has been a focus of this investment, with the added strategic benefits. In Xinjiang, China has begun work on expanding the Karakoram Highway which runs to Pakistan,

and has recently announced plans to establish an Economic Development Zone in Kashgar to boost cross-border trade and make the city a hub for Central Asia.

In Tibet, the government recently announced it would spend 50 billion yuan ($7.5 billion) in the next five-year plan on highway construction, increasing the length of highways from 58,000 km to 70,000 km by 2015.

source; the hindu