China has made a proposal regarding ‘de-escalation’ along the line of actual control or LAC that sources said is ‘unusual’. Yes, China is willing to go back to Finger 8 in the North Bank of Pangong Tso area, but India has to move back from Finger 4 to between Fingers 2 and 3. 

Why should India move its troops back? This is difficult for several reasons:

First, India believes its territory extends right upto Finger 8. So, why should it withdraw to behind Finger 3, where there is a military site? 
Secondly, there was no restriction on Indian troops in the area before May this year, when the Chinese were at Finger 8. So, why should there be any now? 

Instead, India has said the Chinese can go back to where they were in early May, to Finger 8. They moved first. They should move back first. 
Thirdly, there is an enormous trust deficit. Would the Chinese People’s Liberation Army (PLA) troops stay at Finger 8 when India moved its troops back? There is no guarantee at all. 

There is some talk of a North Bank-South Bank Package Deal: Of a general withdrawal from both banks as China is concerned about the Indian Army holding on to tactically important positions in the South Bank right from Spanggur to Richin La. 

What India did in late August, reinforcing its positions in the South Bank has worried the Chinese, leading to their creeping up to Indian positions in the dark and firing in the air. This has happened four times. 

This could be a face-saver China wants, but after what happened in Galwan, India is not keen on giving any face-saver to the Chinese. India’s position is clear: China has to go back to its positions to where they were in April this year.