Bhutan on Tuesday welcomed moves by India and China to withdraw troops from a strategic area which it claims as its territory, ending a months-long military stand-off between its giant neighbours.

The tiny Himalayan country of fewer than a million people had been caught in the middle of what some analysts called the worst crisis in India-China relations in decades.

The row centred on the Doklam plateau, an area high in the Himalayas that is claimed by both China and Bhutan.

India itself does not claim the territory but has a military presence in Bhutan, a close ally.

It stepped in to prevent Chinese border guards from building a road there, prompting Beijing to accuse it of trespassing on Chinese soil.

“Bhutan welcomes the disengagement by the two sides at the face-off site in the Doklam area,” its foreign ministry said.

“We hope this contributes to the maintenance of peace and tranquility and status quo along the borders of Bhutan, China and India, in keeping with existing agreements between the respective countries.”

The Doklam plateau is strategically significant as it gives China access to the so-called “chicken’s neck” – a thin strip of land connecting India’s northeastern states with the rest of the country.

India and China have a long history of mistrust and went to war in 1962 over the Indian state of Arunachal Pradesh.

The latest episode has fed into a broader competition for regional influence between the two Asian powers.