Relations between China and India improved beyond expectations in 2003 and the two countries are poised to become even friendlier this year, international relations analysts say. 'The year 2003 was definitely the best year since 1962, when the two countries fought a fully fledged war,' said Manoranjan Mohanty, a China expert at Delhi University and co-chairman of the Institute of Chinese Studies. Mr Mohanty said last year's highlights were China's acknowledgement of Indian sovereignty over Sikkim and India's reciprocal acceptance of Chinese control of Tibet. Steadily improving diplomatic relations boosted Sino-Indian trade, which topped US$5 billion last year and is expected to touch US$10 billion this year. Bilateral trade was worth just $340 million in 1992. Direct air links between the two neighbours were also established last year. Salman Haider, a former Indian foreign secretary, and Mr Mohanty said the significant changes in political and trade ties resulted from an unprecedented political initiative launched by senior leaders of both nations. They described Prime Minister Atal Behari Vajpayee's visit to China in June, the first by an Indian premier in 10 years, as the turning point in relations which had been frosty since India's defeat in the 1962 border war. The foundations for Mr Vajpayee's visit were laid by George Fernandes, the Indian defence minister who sent relations between the two sides plummeting to a new low in 1998 when he described China as India's main enemy, to justify India's nuclear tests. But last year, a contrite Mr Fernandes braved Sars to visit Beijing in April and pacify lingering anger over his highly inflammatory remark. Mr Mohanty said the most positive outcome of Mr Vajpayee's talks with Premier Wen Jiabao was the appointment of Foreign Affairs Vice-Minister Dai Bingguo and India's National Security Adviser Brajesh Mishra - both considered close to their respective premiers - to resolve the land dispute which led the two nations to war in 1962. India's chief of army staff, General N.C. Vij, is preparing to travel to Beijing in the first visit to China by an Indian army chief since 1962. Significantly, the Indian and Chinese navies held their first joint exercises in 2003 and references to China as the biggest threat to India's security were dropped for the first time from the Defence Ministry's annual report to parliament. Mr Mohanty said the biggest hurdle for Sino-Indian relations was India's ties to the US. 'If India was genuinely non-aligned and maintained an independent foreign policy and opposed hegemony and imperialism, India's relations with China would have been even closer,' Mr Mohanty said. Commentator Brahma Chellaney said while China's tone had become more friendly, it was still trying to contain India through Pakistan, Myanmar and strategic pressure on the Indian-Tibet border.