China on Saturday said it is close to implementing a key bilateral trade arrangement with India to accord each other preferential tariffs on a range of products that would further boost booming trade ties.

"The arrangement between China and India on mutual preferential tariffs is expected to be put into practice soon," the official China Daily reported on Saturday.

With the arrangement, China and India, two developing nations, will offer each other special tariff treatment, which is to be more preferential than their Most Favoured Nation tariffs, the paper quoted officials from the Chinese ministry of commerce as saying.

China will provide a list of reduced tariffs to India based on its 2003 MFN tariffs, with the average tariff rate for goods in the list 13.5-percentage-points lower than its MFN tariffs.

The list will cover 217 items, including food, pharmaceutics and leather, as well as chemicals, textiles and machinery.

Similarly, India will also provide 'specific preferential tariffs' for some products imported from China, the report said.

Just after Prime Minister Atal Bihari Vajpayee's visit to China in late June, the Indian government issued its list.

The Indian side promised to offer specific tariffs, lower than its MFN tariffs, on 188 items from China.

They included aquatic products, paper, steel and other metals, chemical and rubber products, electric equipment and toys.

Xu Changwen, an expert from the Chinese Academy of International Trade and Economic Co-operation, said China and India, the world's two most populous nations, see the implementation of the agreement as a win-win deal for both countries.

Indian exports to China rose by 100 per cent to $1.33 billion, while Chinese exports to India went up by 42 per cent to touch $979 million.

Bilateral trade between China and India is growing despite the political differences over issues like the boundary issue.