BEIJING - The repatriation of alleged smuggling kingpin Lai Changxing to China is another sign of improving relations between China and Canada, following the visit to Beijing by John Baird, Canada's new foreign minister, observers said.

Baird chose China as the destination of his first official visit abroad last week as the minister of foreign affairs in the Conservatives' new majority government.

Two days after Baird wrapped up his official visit to Beijing, Lai, the chief suspect wanted by China for 12 years in a multibillion-dollar smuggling case, was repatriated back to Beijing on Saturday, removing an obstacle to the improving bilateral relationship.

At Beijing International Airport, Chinese police announced Lai's arrest and read him his rights after he was transferred by Canadian officers, the Ministry of Public Security said in a statement.

"Lai's repatriation once again shows that no matter where a criminal suspect flees, he or she cannot evade legal sanctions in the end," the statement said.

His repatriation is also significant for the promotion of Sino-Canadian law enforcement cooperation, it said.

Related departments have made unremitting efforts to "crack down severely on economic crimes and to honor the dignity of national judicial sovereignty and law".

Baird on Saturday said political interference was not behind Lai's extradition, noting that the judicial system works independently from political affairs.

"It is a wise choice for Canada to hand Lai back to China," said Zheng Hao, a commentator of Hong Kong-based Phoenix Satellite Television, noting that Lai had become a "stumbling block" to the normal development of Sino-Canadian relations.

Lai is no longer valued as a "bargaining chip" by the Canadian government in Sino-Canadian relations, said a commentary in the Global Chinese Press, a Canada-based Chinese-language newspaper.

He is now more of a "gift" given by Canada in exchange for more benefits from trade and economic cooperation with China, said the commentary.

"Baird sent a clear signal to Beijing that China is back at the top of Canada's foreign policy agenda," Wenran Jiang, a political science professor at the University of Alberta, said in an article in the Canadian newspaper The Star.

Thirty-one criminal suspects connected with Lai's alleged smuggling operation have been sent back to China from overseas since April 2001.

China's anti-smuggling agency is conducting a further investigation into Lai's case. The case will be referred to judicial organs after the investigation is concluded.

The alleged smuggling took place between 1996 and 1999 and involved "an enormous amount of money", with Lai and his accomplices smuggling oil products, vehicles and cigarettes.

The smuggling operation "seriously disrupted China's economic order and created huge economic losses for the nation", according to the Ministry of Public Security.

Political ties between China and Canada were cold before 2009.

The Conservative government quarreled with Beijing during the early days of Harper's tenure in 2006 over Taiwan and Tibet.

"Sino-Canadian relations did not develop well in those years," said Zheng, describing the bilateral relationship as "extremely tense" before 2009.

Bilateral ties hit rock bottom in 2008 when Harper refused to attend or send high-ranking officials to attend the Beijing Olympic Games opening ceremony.

As a result of the 2008 financial crisis, the deepening woes of the US economy and growing domestic criticism, the Harper government finally "realized that it was not in Canada's interests to continue to ignore China", Zheng added.

The cold ties began to warm up in December 2009 when Harper visited Beijing, the first Canadian prime minister to do so in five years.

Beijing and Ottawa signed four agreements during Harper's visit that called for greater cooperation in fields including climate change, natural resources, culture and technology.

Harper is looking forward to visiting China again, according to Baird.

Canada's annual merchandise exports to China totaled $13.2 billion in 2010, increased 18.7 percent year-on-year, according to Canadian federal government data, while the total bilateral trade volume was $36 billion in 2010, up by 20 percent.