New Delhi: Indian foreign minister S Jaishankar on Friday said that in many ways China is a "challenging neighbour" for India.

Speaking at the India Economic Conclave, he also described as "sensible" the recent agreement between the military commanders of India and Pakistan to adhere to a 2003 ceasefire along the Line of Control (LoC) in Jammu and Kashmir.

"We always wanted normal neighbourly relations with Pakistan. Everybody knows what that means. If there are trends in that direction, of course, I would welcome it," he said.

Asked during the interaction on whether India will engage with the Taliban, Jaishankar said that New Delhi would like to see a sovereign democratic and inclusive Afghanistan that takes into account the interests of its minorities.

"There is something called the peace and reconciliation process and everybody else is saying that the Taliban is reaching out and changing etc. Let us wait and watch."

To a question whether China has become indispensable to economic calculations, Jaishankar said China had salience in the global economy.

"I do not think anybody can deny it. I think one needs to appreciate what they have done to their national capabilities in the last 40-odd years," he said. The Chinese in many ways had "outthought" the West including former president Richard Nixon and his secretary of state Henry Kissinger who launched a process of rapprochement with the Chinese. It was not just Nixon and his administration that the Chinese had “out thought" but also “their successive generations."

"And not just America, the West as a whole which explains why they are where they are today," he added.

The future however was not clear given that there were a lot of "contradictions and frictions," the minister said.

"But when it comes to us, we need to ask ourselves: so we have this neighbour who has done spectacularly well. So do we just stand there with our hands in our pocket and marvel at what they have done or do we say this is an inspiration, I need to also strengthen my competitiveness and my capabilities and so on," he said.

Jaishankar clarified that his comments are not a political statement and that it is an international relations or even a domestic governance observation.

"We were about the same size of economy when Rajiv Gandhi went to China in 1988 and look at the difference today. So for me I have always seen lessons in China's growth," he said.

"To me, in many ways, yes China is a neighbour and it is in many ways a challenging neighbour," he added.

The comments come in the wake of tensions between India and China in Ladakh since 5 May 2020. Following military and diplomatic talks, India and China completed withdrawal of troops and weapons from the North and South banks of Pangong lake last month.

Asked whether the agreement between the directors general of military operations of India and Pakistan and the talks between Indus commissioners of the two sides were a sign of thaw in ties, Jaishankar said, "I think the agreements between the DGMOs is a sensible agreement because I don't think Pakistan either did themselves or us good by encouraging or facilitating infiltrators and terrorists across the Line of Control and the IB (International Border).

When pressed whether these are positive developments, Jaishankar answered in the affirmative.

Jaishankar confirmed that he was travelling to Tajikistan capital Dushanbe to attend the 'Heart of Asia' conference on Afghanistan but did not give a specific reply to questions on whether he would meet his Pakistani counterpart Shah Mahmood Qureshi on the sidelines of the event.

"My scheduling is in progress. So far I do not think any such meeting (is scheduled)," he said.

The Heart of Asia conference is scheduled to take place on 30 March.