Indian Prime Minister Manmohan Singh and Chinese premier Wen Jiabao met here Tuesday for the first time and reaffirmed their political will to resolve their border dispute soon - but said a delay in finding a solution should not hinder expansion of ties in other areas.

During a 40-minute meeting, the two leaders hoped the guiding principles in resolving the border issue between the two countries would be finalised soon.

They noted that much progress had been made during two rounds of talks between India's Special Representative and National Security Adviser J.N. Dixit and his Chinese counterpart Dai Bingguo since the Congress-led coalition government took office in New Delhi in May.

Tuesday's meeting between the two prime ministers was their first since Manmohan Singh became the head of government in May this year and was held on the margins of the 10th Summit of the Association of Southeast Asian Nations (ASEAN) that both are attending as the grouping's Dialogue Partners.

Indian External Affairs Minister K. Natwar Singh also participated in the talks. Wen, in fact, asked the foreign ministers of the two countries to work "very hard" and shook hands with Dixit, recognising him as India's interlocutor on the border issue.

Dixit, who briefed reporters after the meeting, said the Chinese premier also assured the Indian side that a decision had been taken by Beijing on recognizing Indian sovereignty over Sikkim and that would be implemented gradually.

While Manmohan Singh said India had no anxiety about Sikkim, the Chinese leader indicated that Beijing recognised that Sikkim was an integral part of India.

In fact, one of the steps already taken by China is not to show Sikkim as a part of their territory or a separate country in their web site as also their almanac, officials said.

India, on its part, told Wen that New Delhi's position on the issue of Tibet - that it was an autonomous region of China - was clear and that Beijing need have no worry on the matter.

There was no reference to Pakistan during the talks between Singh and Wen. "There was no mutual paranoia on Pakistan," Dixit said, adding Islamabad did not figure in any of the bilateral talks.

The Chinese premier also hoped that there would be some positive signals sent to the world when he visits India early next year, indicating that another irritant in relations - in respect of the territory of India's northeastern state of Arunachal Pradesh that China has disputed - would also be set to rest fast.

Wen said he was attaching much significance to his visit to India and termed it would be the most important bilateral engagement for him in 2005 that would boost Sino-India relations further.

He said relations between India and China that went back several centuries were 99.9 percent good, and aberrations remained only in 0.1 percent. He said the results of the visit to Beijing by former prime minister Atal Bihari Vajpayee in June 2003 showed that progress in bilateral relations would continue irrespective of the political dispensations.

Manmohan Singh, on his part, said India will "show adjustment" during the talks on the border issue, but added that such steps must take note of the ground realities of today. He said progress was being made on the issue that has dogged relations since the colonial era of British rule.

The two leaders said ties between the two countries on trade and investment were far below potential and said their scope must be enlarged to include greater cultural interactions and people-to-people contact.

Manmohan Singh said bilateral trade between the two countries was rather low at $12 billion per annum, to which his Chinese counterpart added the potential was as high as $100 billion, given the size and huge populations of the two nations.

--Indo-Asian News Service