What China’s rise means for India

China’s economic achievements in the last three decades of 10 percent-plus GDP growth have inspired awe around the world. We all know the consequences—the accumulation of hard power in all its forms, China as the world’s manufacturing workshop, the trillion dollar foreign exchange surpluses, the ability to determine commodity prices in world markets, the presence of China in most global value and production chains, and so on. The speed and scale of China’s transformation are astonishing. As a rising power, meanwhile, China is determined to have an independent say in the economic, political, and security order around her and in the world.

What does China’s rise mean for India?

Complicating the scene

Absent drastic modifications in Chinese or U.S. behavior—which I consider unlikely—the rise of China promises an extended period of political and security instability in Asia and the Pacific. There will be no quick recovery for the world economy, and security competition between the United States and China will remain the principal contradiction, as Mao would have said. The assertive China that we have seen since 2008 is here to stay for the foreseeable future. Security dilemmas between China and Japan; China and India; China and Vietnam; and others will intensify.

The assertive China that we have seen since 2008 is here to stay for the foreseeable future.

In other words, the environment in which India pursues its interests will get more complex. And the very complexity of the situation in the Asia-Pacific gives India a choice of partners and collaborators to work with in the pursuit of its interests.

An assertive China is unlikely to seek an early settlement of the ongoing border dispute with India. Fifty years of stability on the border suggests that give and take on the status quo is most logical. But China’s other interests—its relationship with Pakistan, suspicions about Tibet, and desire to maintain levers in the relationship with India—suggest that a border settlement is not a Chinese priority at present. (Nor, for that matter, does it seem to be a priority of the present government in New Delhi.)

China’s other priorities—religious extremism and terrorism in Xinjiang, overland access to the Indian Ocean, keeping India in check, a window on Western arms technology, the Chinese commitment and presence in Pakistan Occupied Kashmir—have made Pakistan even more crucial to China’s purposes. Pakistan’s game is to suck India into confrontation, thus establishing Pakistan’s utility to those who feel the need to balance India’s rise (including China, the United States, and others). Today, Russia sells arms to Pakistan, the United States supplies arms and discusses Pakistan’s nuclear weapons and Afghanistan’s future with it, and China has committed $46 billion to an economic corridor and Gwadar in Pakistan. Each of these represents an increased commitment to Pakistan which is an order of magnitude bigger than ever before. India asks the West to refrain from supporting Pakistan, but countries will act according to their own interests. So long as Pakistani terrorism is not a threat to them, they will not expend blood or treasure eliminating Pakistan origin terrorism for India.

China, meanwhile, remains dependent on the Indian Ocean and has suspicions about India-U.S. defense cooperation and strategic coordination. Taken together, all these factors make it likely that China will keep the border issue alive as a lever in its relationship with India. Nevertheless, the overall salience of the border in the relationship has diminished considerably, now that the Border Peace and Tranquility Agreement of 1993 and subsequent confidence-building measures have stabilized the status quo.

Room to work together

Bilaterally, China is now India’s largest trading partner in goods, while the two compete for global markets. Today, over 11,000 Indian students study in China, and there are mechanisms to deal with issues like trans-border rivers, the trade deficit, and others.

On several global issues in multilateral forums—such as the World Trade Organization and climate change negotiations—the two have worked together, each in pursuit of its own interests. So prospects are good, overall—both bilaterally and by working together on the world stage.

Fundamentally, the relationship is simultaneously cooperative and competitive. That duality is clear in terms of core national interests. Both countries have an interest in improving on the existing security and economic order. This is why India has been among the founders of the Asian Infrastructure Investment Bank and New Development Bank. But the two compete in the periphery they share, hence India’s hesitation on the One Belt, One Road initiative and its sensitivity about Chinese military presence in the Indian Ocean littoral. And neither thinks the other has accepted its territorial integrity.

Maritime security is a good example of that duality. Both countries have a common interest in keeping sea lanes of communication open, but each will oppose any attempt by the other to control the seas and straits through which these sea lanes pass.

India, China, and the world

In this situation, the rest of the world can only be a limited enabler in India-China relations, using India-China competition for their own purposes. Ultimately the relationship is a critical one that will determine both countries’ futures, and they alone can determine its trajectory. Today we seem to be entering a new phase in the relationship, and I hope we will be successful in smoothly attaining a new equilibrium.

[T]he terms in which foreign and security policy are discussed in China and India…have become much more shrill.

In the short term, the cooperative-competitive pattern will likely continue. One troubling development, however, is the rise to power in both countries of conservative, authoritarian centralizers. Some of the national leaders who have risen to power since 2012 have little experience of central government and foreign policy, and hold strong ideological predispositions to nationalist and even chauvinist rhetoric. While they have been careful in their public utterances, the terms in which foreign and security policy are discussed in China and India (as well as Japan), have become much more shrill. Anti-foreign views, jingoistic slogans, intolerant ideas, and downright bad manners are now more common. These would not matter in normal times, but governments are under stress now—and leaders could seek external release from internal difficulties.

Another risk in India-China relations comes from the mutual gap between perception and reality. The China that I see described in Indian commentary bears little resemblance to the China that I have worked with, lived in, and seen on my visits. The same is true of Chinese perceptions of India, though to a lesser degree. The problem has become more acute recently, and narratives of inevitable conflict can be self-fulfilling prophecies.

Needless to say, I am convinced that we are at a moment of opportunity for India-China relations. This is due to the rapid development of both countries in the last thirty years, to what they have achieved bilaterally, and to the evolution of the international situation. It would benefit each country’s core interests to work with the other.

Note: This post is adapted from a speech delivered at the National Law University in Delhi on November 19, 2015.