A mixed group of at least 160 personnel each from Indian and Chinese armies participated in the drill.
The Indian soldiers returned back to Guwahati, Assam, on Thursday night.
Interacting with media, Brigadier D.S. Shisodiya said: "Firstly, we had a very nice professional interaction with our counterparts there (Chengdu in China), and it was a very good training on counter terrorism. It is…with mutual trust and co-operation between the two nations. I am sure that it will lead to further improvement of relations with them."
Brigadier Shisodiya further said this training would also reduce tensions over border disputes between the two Asian giants.
The joint training exercise between the two countries was one of the major bilateral defence cooperation and is third in the series which started in 2007. The first was held at Kuming, China in December 2007 while the second was held at Belgaum, India in November 2008.
Earlier, in May, armies from the two countries ended a three-week standoff in the western Himalayas after Chinese troops set up a camp at least 10 kilometres (six miles) inside the territory claimed by India, triggering a public outcry and calls that India should stand up to its powerful neighbour.
China has repeatedly denied that it troops crossed into Indian territory.
In October, a Chinese airline blocked two Indian archers from disputed Arunachal Pradesh from travelling to China, souring the mood in India ahead of Prime Minister Manmohan Singh''s visit to Beijing.
Later both sides signed a deal aimed at soothing tension on their contested border, as the two nuclear-armed giants tried to break a decades-old stalemate on overlapping claims to long remote stretches of the Himalayas.
China, a close ally of India''s long-time foe, Pakistan, lays claim to more than 90,000 square kilometres (35,000 sq miles) disputed by New Delhi in the eastern sector of the Himalayas. India says China occupies 38,000 square kilometres (14,600 square miles) of its territory on the Aksai Chin plateau in the west.
The two countries fought a brief border war in 1962.