In the backdrop of concerns over stapled visas being given by China to Kashmiris, Prime Minister Manmohan Singh on Friday asked it to be sensitive to India's "core issues" as he met Chinese Premier Wen Jiabao here, even as the two sides agreed to work their way to solutions to the "difficult" problems.

At the same time, the two leaders agreed that there was enough space in the world for both the countries to grow and they should cooperate and collaborate. In this regard, Wen will visit India by the end of 2010, possibly in December, a step that was immediately welcomed by Dr Singh at the meeting.

It was also decided at the 45-minute meeting that the Special Representatives of the two countries will meet by the end of this month to discuss "difficult" issues, including the boundary question.

"The Prime Minister raised the issue of all difficult questions and showing sensitivity to each other...The Prime Minister spoke of the need to show sensitivity to each other's core issues," National Security Adviser Shivshankar Menon told reporters while briefing on the meeting, the first top level contact since the Sino-India defence exchanges were suspended in July.

Menon refused to elaborate on the "core issues" but sources noted that this relates to anything connected to Jammu and Kashmir.

China has been giving visas to people of Jammu and Kashmir on loose sheets of paper instead of passports, an action seen by India as questioning its sovereignty.

The matter snowballed into a major controversy in July 2010 when Beijing wanted to give such a visa to India's Northern Area Commander Lt. Gen. B.S. Jaswal.

India responded by suspending high-level defence exchanges for which Lt. Gen. Jaswal was travelling to Beijing and has repeatedly made it clear that these will remain on "pause" till China reverts to its position on the issue.

On whether the stapled visa issue was raised by Dr Singh, Menon was evasive, saying "we were instructed, SRs and officials on both sides, to prepare for Wen Jiabao's visit and work our way to solutions to all the issues that are difficult in our relationship, including boundary question."

"We will continue the process of engagement and continue to deal with issues that concern us," he said on the stapled visa issue. Asked to spell out India's "core issues," the NSA did not specify but said these have been indicated by the two countries to each other.

While on the Indian side, the "core issues" are Jammu and Kashmir and Arunachal Pradesh, on the Chinese side, these relate to Tibetan spiritual leader the Dalai Lama.

"This is an ongoing conversation. We will continue that discussion as we lead up to Premier Wen Jiabao's visit which I am sure will be a successful and productive visit," Menon said.

The high-level defence exchanges, however, will remain suspended, with Menon saying, "we will continue to work on the issue." The two leaders, while going through the entire range of relationship taking the "larger strategic view," also discussed the economic aspect of the ties in the backdrop of concerns in India over the big trade imbalance in favour of China.

In his initial remarks at the meeting, Wen referred to Dr Singh's oft-repeated statement that there is enough space in the world for India and China to achieve common development.

While agreeing with it, he said, "on top of our remarks, I add that there is enough space in the world for India and China to have cooperation."

Noting that the two countries had "viewed and handled" their bilateral relations with a "strong sense of history," he said India and China have stayed in touch and worked together to build a stable and steady growth in ties.

Wen said Dr Singh had extended invitations to him a number of times to visit India and "my preliminary information indicates that I will pay a visit to your country by the end of this year."

To make this visit a productive one, he suggested that "we discuss and reach a consensus on some major aspects so as to lay a foundation for the visit."

Responding to this, Dr Singh noted that the two were meeting for the 10th time in six years and welcomed Wen's decision to visit India. "You are the architect of Strategic
Cooperative Partnership which both the countries signed during your first visit to India in 2005. Our relations have evolved satisfactorily. We are very satisfied with growth of trade and economic relations between India and China," he told Wen.