Amid Sino-India differences, Union Minister Arun Jaitley said on Monday that occasional hiccups in bilateral ties would arise due to the "unsettled" border issue.
"We believe that it is important that the border gets settled because that is in the interest of regional peace. Obviously, you will have occasionally some issues arising because of that unsettled situation," Jailtey said at the Council on Foreign Relations, a prominent American think tank.
Jaitley, who came to New York on Sunday after attending the annual Spring Meetings of the International Monetary Fund and the World Bank, said the Sino-India border was still an "unsettled border".
"In 2003 the prime minister visited China...I had accompanied him and we had a mechanism set up in order to resolve and define the border itself. Since 2003, that mechanism has not been able to come out with an answer," he said referring to the 19 rounds of talks between the Special Representatives of the two countries.
The Finance Minister said that India has a very developing relationship with China.
"Our economic relationship has strengthened significantly. There is a lot of trade between India and China that takes place. Now that is one area of strength that has picked up," said Jaitley, who holds the additional charge of the Defence Ministry.
Jaitley's remarks come amid differences between India and China on a host of issues.
India and China were recently involved in a war of words over the Dalai Lama's visit to Arunachal Pradesh and Beijing's move to standardise official names for six places in the frontier state.
The India-China border dispute covers the 3,488 km-long Line of Actual Control (LAC). While China claims Arunachal Pradesh as South Tibet, India asserts that the dispute covers the Aksai Chin area which was occupied by China during the 1962 war.