``China never views India as its enemy. And it did not in the past and does not at present pose a threat to India...The so-called `China's threat to India' is entirely baseless and fabricated,'' Chinese ambassador to India Zhou Gang told PTI in a wide-ranging interview.

The Chinese envoy spoke at length on the present state of Sino-Indian relations, India's decision to have a minimum nuclear deterrent, Beijing's stand on Jammu and Kashmir and the prospects of enhancing economic and cultural cooperation between the two countries.

New Delhi's relations with Beijing took a nose-dive after the Pokharan nuclear tests in May last year and a reported remark of Defence Minister George Fernandes in April, terming China as India's ``potential threat number one''.

Zhou Gang said,``Since April and May last year, some new problems have cropped up in Sino-Indian relations. This is what the Chinese side did not expect or is unwilling to see. We feel distressed at the upsetting (of) Sino-Indian relations.''

Zhou said the Chinese Government has all along maintained that there exists much more commonalities than differences between the two countries and that ``there is no conflict of fundamental interests between them''.

Expressing the hope that the ``present state of situation'' does not continue, Zhou said, ``It is the desire of the Chinese side to resume the Sino-Indian dialogue and develop friendly cooperation as early as possible.''

``We welcome the statements made by the Indian leaders that India does not regard (China) as its enemy, attaches importance to friendship with China, wishes to resume dialogue and develop bilateral relations,'' the Chinese ambassador observed.

Zhou virtually rejected the suggestion for a strategic triangle of China, Russia and Indiamooted by Russianpremier Yevgeny Primakov.

On Beijing's stand on Jammu and Kashmir, Zhou said the ``Kashmir dispute'' was an issue left behind by history, over which India and Pakistan have had differences since their Independence.

``The United Nations has adopted several resolutions on the Kashmir issue. India and Pakistan have also reached the Shimla agreement. The Chinese side sincerely hopes that India and Pakistan will hold dialogue in a frank and candid manner, and peacefully resolve the Kashmir dispute through consultations,'' he said.

Asked about Beijing's reaction to the Indian decision to maintain a minimum nuclear deterrent, he said, ``China's stand on the issue of nuclear non-proliferation is clear and consistent.''

``The international community has universally called upon India to fully implement the UN resolution 1172 adopted by the Security Council. India, instead of maintaining the so-called minimum nuclear deterrent, must accede to the Comprehensive Test Ban Treaty (CTBT) and the NuclearNon-proliferation Treaty (NPT) without delay and conditions,'' he said.

On Washington's indication of easing sanctions by international financial institutions during the just-concluded eighth round of Indo-US dialogue on nuclear non-proliferation issues, Zhou, on his second stint in India, said, ``Basically, China does not advocate sanctions.''

Maintaining that China will not establish any military bloc, join in the arms race or conduct military expansion, Zhou went on to claim that ``China has neither stationed any troop nor established any military base abroad''.

The Chinese ambassador refuted the statement of Fernandes that China has established naval facilities in Myanmar's Coco islands, 40 kms north of Andaman and Nicobar islands, and said it is ``purely fictitious and fabricated".