New Delhi: The "chemistry" between Prime Minister Narendra Modi and Chinese President Xi Jinping during the latter`s September visit exemplifies the friendship between the two nations and the niggling issues of boundary dispute and trade imbalance would be solved once "favourable conditions" are created, a top Chinese official said here Saturday.

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Chinese envoy to India Le Yucheng, addressing a conference `Shaping the 21st Century: India, the US and China`, said he is "very optimistic about the future" of India-China bilateral ties.

He said during Xi`s visit to India in mid-September, everyone noticed the "chemistry" between the two leaders as Modi and the Chinese president sat on a swing "smiling and chatting" on the Sabarmati river front and also visited Mahatma Gandhi`s ashram in Ahmedabad, which showed the friendship and affection between the two leaders.

"Yes, we do have some problems, the trade imbalance and regarding the border...And both have been very constructive about it. We continue to hope that we will find a way out of the dilemma," Le said at the conference organised by the Deccan Herald newspaper.

"We will make cooperation speak up and facilitate to solve the differences," the envoy said, adding that there is need to create "favourable conditions for a final solution" to the two issues.

There have been frequent incidents of transgressions by the Chinese troops into the Indian side, leading to stand-offs between the two sides. Both countries have agreed to hold regular interaction between their army headquarters and field commands to maintain peace and tranquility along the 4,000-km boundary.

Giving an example of successful economic cooperation between the two, Le said Chinese e-commerce major Alibaba, founded by Jack Ma, has 1.3 million Indian vendors doing business and making money. 

He said that 400,000 Chinese businesspersons were purchasing Indian products through Alibaba. 

Elaborating on his country`s foreign policy, Le said China "advocates peaceful settlement of disputes through dialogue" and while "China is rising it does not want hegemony".

"China will remain a benign power and conduct foreign policy in a constructive way, and seek friendship and cooperation with all countries, including its neighbours and India," he said.

To a question on Beijing`s assertiveness in the South and East China Seas and territorial discord with countries in the region over islands dotting the sea, the envoy said that there are "complications" that could be solved through mutual dialogue, but added that China has "undisputed sovereignty" over the islands.