The MEA statement post the 22nd round of India-China boundary talks that concluded on 21 December 2019, in Delhi, between Mr Ajit Doval, NSA and China’s State Councillor and Foreign Minister Wang Yi is significant in many ways. Irrespective of Wang Yi’s hyper effort to raise abrogation of Article 370 issue in the UNSC twice; at the end

of the boundary talks, both countries have firmly identified that “stable and balanced development of India-China relations is a positive factor for peace and prosperity in the region and the world”. It doesn’t really reflect China’s change in attitude. The baggage of Pakistan which rides the back of China was visible once more when China made a third attempt to raise the issue in UNSC but the US and France firmly opposed the move. On the contrary, the Indian approach has been very mature and responsible.

Is it only the baggage of Pakistan which compels Chinese behaviour? Not really! It may be worthwhile reflecting on China’s perceptions of India.

  • In 2003 India formally recognised Tibet Autonomous Region as China’s Chinese scholars see this as the end of the Tibet issue. But the political perception is suspicious of India’s intentions since the Tibetan Government In Exile is sheltered in Dharamshala. However, the Indian government has made it clear to Tibetan refugees to refrain from activities which adversely impact its relations with a friendly country.
  • The second issue is related to the successor of the Dalai Lama. Chinese scholars are concerned about the impact on Sino-Indian relations if China chooses its own Dalai It may also worsen relations between Tibetans and Han Chinese.

China is also sceptical about India’s reaction to its increasing influence on Indian Ocean littorals and any further deterioration in Indo-Pak relations post increase in maritime cooperation between China and Pakistan. Economic growth is extremely important for both Asian giants for the prosperity of their own population as well as the region. Both the countries are aware of the same, which is also reflected in the boundary talks and Wuhan/Chennai declarations.

Any military action could derail economic growth. China is far ahead in prosperity having commenced opening up of its economy during the Deng Xiao Ping era in the early 80s. Presently, U.S and China lead the world in energy consumption (necessary for upscaling prosperity); however, they will be joined by India by 2035. Both China and India are energy-dependent on Middle-East countries whereas the U.S has  become an exporter of oil.

The competition between state-owned energy companies of the two countries has intensified in Africa, Latin America, Russia and Myanmar. China and India had agreed in 2005 to jointly survey and explore petroleum and natural gas resources in the third country. The energy companies are already cooperating in the realm of energy security in Sudan and Kazakhstan. India’s knowledge of legal systems and administration in Western Countries and China’s financial strength is bound to increase the growth of two economies and prosperity.

While China is aiming to increase its per capita income (in PPP terms) equal to that of the US, India is targeting making its economy a USD 5 trillion economy in the near term. Beijing and Delhi have realised that if they don’t manage their competition in an appropriate manner, it would have an adverse effect, not only on their bilateral relations but also in the prosperity they are targeting. If economic disputes escalate, both governments will intervene at the highest level to stabilise the situation. Sino-Indian trade has been expanding rapidly in recent years. Chinese manufactured goods, technology and labour have become part of the Indian economy. However, trade relations are also characterised by the large Indian trade deficit.

India’s exports are primarily in IT service sector but many Indian companies have come under pressure of cheaper Chinese imports. But increasing trade between the two countries also reflects stable bilateral relations. Industrialisation in India should lead to increased exports and reduce the trade deficit in the near future. It is believed in China that deepened economic interdependence could assist in stable bilateral relations and mutual trust.

Due to China’s focus on economic growth and prosperity, it would be detrimental to China’s interest if relations with India deteriorate. Recommended course for the prosperity of people of both countries would probably be:- China and India maintain peace and tranquillity on land borders and transparency in developmental work in IOR littorals while making rapid progress on the permanent settlement of border.

Leveraging each other’s market access and manageable trade balance. India should invite Chinese investments to boost exports and infrastructure development. Both countries undertake domestic economic reforms to enhance the competitiveness of the manufacturing sector. Build linkages between Defence and Security Academies of two countries.  

Vice Admiral Shekhar Sinha, PVSM, AVSM, NM and Bar is the former Commander in Chief, Western Naval Command & former Chief of Integrated Defence Staff. He is presently Chairman, Board of Trustees, India Foundation.

Vice Admiral Shekhar Sinha

Vice Admiral Shekhar Sinha, PVSM, AVSM, NM and Bar is the former Commander in Chief Western Naval Command & former Chief of Integrated Defence Staff. He is Member, Governing Council, Centre for Security Studies, India Foundation.

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