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NEW DELHI (Reuters) - Indians have been more amused than outraged by an agitprop video released by a Chinese state news agency that accuses India of perpetrating "Seven Sins" in a two-month-old frontier standoff and resorts to a racial stereotype to make its point.

The video, an edition of Xinhua's new "Spark" show, features anchor Dier Wang accusing India of trespassing on Chinese soil, violating international law and "hijacking" the tiny kingdom of Bhutan that has been caught up in the dispute.

An actor wearing a turban and stick-on beard gives obtuse answers, to canned laughter, in the three-minute video posted via Xinhua's English-language account on social network Twitter (http://bit.ly/2vK7HQp). Twitter is blocked in China.

"Have you ever negotiated with a robber who had broken into your house and refuses to leave?" asks Wang in American-accented English. "You just call 911 or just fight him back, right?"

The actor, apparently representing India, answers: "Why call 911 - don't you wanna play house, bro?"

Dier gets the last word: "If you wanna play, get out of my house first."

The trouble started in June when India sent troops to stop China building a road in the Doklam area, which is remote, uninhabited territory claimed by both China and India's ally Bhutan.

China has repeatedly asked India to withdraw from the area or else face the prospect of an escalation. Chinese state media have warned India of a fate worse than its crushing defeat in a brief border war in 1962.

Although the escalation in tension is the worst in years, the clip's sketchy production values offered light relief while the stereotype played by the "Indian" actor appeared to cause only mild offence.

"This is China's official sense of humour!" tweeted Indian defence pundit Ajai Shukla. "Xinhua isn't quite sure whether it's producing a spoof ... or a propaganda piece."

India's foreign ministry could not be reached for comment while no immediate comment was available from the Chinese foreign ministry. Xinhua asked for questions about the video to be sent by fax, to which it did not immediately respond.

(Reporting by Douglas Busvine; Additional reporting by Philip Wen in BEIJING; Editing by Robert Birsel)

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