After a candid review of developments and challenges, bilateral, regional and global, the two leaders in a joint statement expressed their resolve to build 'a cooperative partnership based on mutual respect and mutual benefit', an outcome welcomed in Beijing as 'historic' 'extraordinary and far-reaching' in its significance, and as one which would raise the global influence of Sino-US relations. 'China welcomes the United States as an Asia-Pacific nation that contributes to peace, stability and prosperity in the region', the statement said making a formal recognition of a reality.

The two countries have now agreed to resume work on developing military-to-military relations, which were suspended after US decision to supply arms to Taiwan in January 2010. (Defence Secretary Robert Gates had gone to China ahead of President Hu's visit to re-establish contacts at the highest defence levels).The leaders affirmed that a 'healthy, stable and reliable military-to-military relationship is an essential part' of their shared vision for a positive, cooperative and comprehensive US-China relationship.

How wide apart the two Presidents were on some of the key issues such as human rights and China's exchange rate became apparent at their joint news conference, especially on human rights. The US President, pointedly raising this issue with President Hu, referred to America’s fundamental commitment to the universal rights of all people including basic human rights. 'The United States speaks up for these freedoms and the dignity of every human being because by upholding these universal rights, all nations including China will ultimately be more prosperous and successful,' President Obama said.

To a question posed to him, President Hu largely stuck to China's timeworn script on human rights equating it with interference in a country's internal affairs and not respectful of a country's choice of a development model. Nevertheless, he acknowledged the 'universality' of human rights and said China was making efforts 'to improve the lives of people and promote democracy and rule of law'. while conceding that 'a lot still needs to be done in China in terms of human rights'.

President Obama said both countries have now agreed to move ahead with our formal dialogue on human rights and to new exchanges to advance the rule of law. Even as USA recognised that Tibet is part of the People’s Republic of China, he said, it continues to support further dialogue between Beijing and representatives of the Dalai Lama to resolve concerns and differences, including the preservation of the religious and cultural identity of the Tibetan people.

On the Chinese currency (renminbi - RMB) which US considers 'undervalued' to gain a competitive advantage, Mr Hu dismissed it as a matter to be looked at the entire economic relationship of which currency was one part. President Obama said while his government welcomed China's willingness to increasing the flexibility of its currency, RMB remains undervalued and needs further adjustment, which can also help boost domestic demand and lessen the inflationary pressures in China's economy.

At a roundtable with US and Chinese business leaders at the White House, President Hu said they would have a 'promising future' for doubling US exports, as President Obama planned, as China was speeding up transformation of its growth pattern expanding domestic demand and would promote private investment in the service sector. Both Presidents agreed on the importance of achieving a more balanced trade relationship.

Market access issues have posed a challenge for foreign enterprises in China and were raised by President Obama. It is here that President Hu relented somewhat with promise of moderating the current rigidities such as in regard to protection of intellectual property, government procurement policy, and insistence on 'indigenous innovation', all of which denied, in the eyes of US business and Administration, a level playing field for the technologically superior American companies.

China has agreed to strengthen its efforts to protect intellectual property rights including by conducting audits to ensure that government at all levels used legitimate software and not to link its 'indigenous innovation' policies to the provision of government procurement preferences, according to the joint statement. China has agreed to submit a revised offer to the WTO Government Procurement Committee. The two countries would continue negotiations for a bilateral investment treaty for facilitating and protecting investment and enhancing transparency for investors of both countries.

Exports and jobs have gained pivotal importance in economic policies of the world's largest economy, now running huge fiscal and current account deficits, and the Obama Administration is sanguine about fast-growing exports to China - exceeding 100 billion dollars in 2010. The President welcomed new business deals, mostly joint ventures, timed for the Hu visit, with China agreeing to buy 45 billion dollars worth of American exports which include 200 Boeing airplanes (19 billion dollars). The deals would support 235,000 jobs in 12 states

There is great expectation though tinged with caution on the part of US corporates to expand business in a huge market like China's but this would depend on how far Beijing acts upto the commitments on market access. China has reportedly been requiring western MNCs to share technology and knowhow to be able to out-compete them later through its 'indigenous innovation' policy.

A 'peaceful rise' of China is good for America and for the world, Mr Obama said. The United States is not interested in containing China but only wanted to make sure that its rise occurred in a way that reinforced international norms and rules and enhanced security and peace and not be a 'source of conflict' either in the region or around the world. The security and economic dialogues that USA and China have established are precisely designed to lessen suspicions, to enhance mutual understanding and take advantage of opportunities, he said.

In East Asia, the President emphasised America's. fundamental interest in maintaining freedom of navigation, unimpeded commerce, respect for international law and the peaceful resolution of differences. He hoped progress made on both sides of the Taiwan Strait in reducing tensions would continue 'in the interest of both sides, the region and the United States'. Reassuringly for the mainland, the President reaffirmed US commitment to a one-China policy and Taiwan Relations Act.

In a major address on US-China relations, on the eve of President Hu's visit to Washington, Secretary of State Hillary Clinton underscored the role of USA as both an Atlantic and Pacific power, and said, “we are firmly embedding our relationship with China within a broader regional framework because it is inseparable from the Asia-Pacific’s web of security alliances, economic networks, and social connections.'. There is no such thing as a 'G-2', she said and cited US efforts to strengthen bonds with its Asian allies (Japan, South Korea) and deepen partnerships with India, Indonesia and other Asian countries. 'We are taking steps to ensure that our defense posture reflects the complex and evolving strategic environment in the region'. (IPA Service)