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With the growth of the confidence between the China and India relations both the states have amended their past as that was shaped with worse memories as both the nations went to war in 1962 which has frozen the relations between both the states until the end of the Cold War. Since then both the nations have never looked to their past and have tried to resolve the past grievances through peaceful means. As a result the trade between both the states has flourished and has started a new era in the relations of both the states. With the growth of the relations both the states face multiple challenges as they have the unsettled borders and issues like Tibet and Kashmir present a greater challenge to their development. Whereas US strategic alliance with India and Chinese support to Pakistan has been also an irritating problem for both the states. On the other hand their development would increase the bilateral trade which has seen tremendous rise since the end of the Cold War era, but the rising trade would sooner be a challenge for both the states as both the states have already tried to influence the sphere of influence of each other. Such as the India is trying to win the ASEAN markets and Chinese regards the ASEAN as its sphere of influence and on the other hand China has been involved in South Asia which is Indian sphere of influence. Despite these challenges the relations among both the states continued to be warmer and friendly, which will have a positive impact over the region.