China and India today represent the world’s two largest and fastest-growing economies. Even the global economic crisis has not slowed their rapid pace of development, which has triggered internal and external challenges for both nations. Yet, even as China and India increasingly collaborate in regional and global fora, they are experiencing frequent and sustained tensions. In the first of the Carnegie-Tsinghua Center for Global Policy’s China-South Asia Dialogue series, Professor Swaran Singh of Jawaharlal Nehru University in New Delhi visited the Carnegie-Tsinghua center to discuss current and future relations between India and China. The event was moderated by Carnegie's Lora Saalman.

Economic Ties

China-India relations are defined by a number of key issues, including sustained economic growth, energy procurement, climate change, and perennial U.S. regional presence, argued Singh.

  • GDP Growth: China and India’s per capita GDP were once very similar, but current trends predict China’s GDP will match the United States by 2030, while India’s GDP will only reach this milestone in 2050. Population numbers, not technology, remain the key to both countries’ increasing influence. Singh added that since China and India have both weathered the economic recession better than the United States, the international community may call on both nations to share the global security burden, as U.S. defense budgets are likely to decrease.

  • Trade Imbalance: China and India continue to face impediments in moving from bilateral trade to mutual investment. The existing large trade imbalance between the two countries causes tension, Singh said. Trade primarily occurs via sea-lanes, while the border between China and India remains underutilized, marked by harsh terrain and underlying border disputes. None of the three major trade points at the China-India border has been a commercial success, although the trade point at Nathu La, which sits at a population center at Tibet’s traditional crossroads, has some potential.

  • Climate Change: China and India engaged in unprecedented coordination during the Copenhagen climate change conference in 2009, Singh said. This cooperation has been followed by frequent four-party talks among China, India, Brazil, and Mexico. Singh argued that energy has increasingly become a “currency of power” and nations with energy resources to export, or who have sufficient energy and infrastructure for their population, are seeing a substantial increase in prosperity. Obama’s willingness to push forward such trends, including on a nuclear-free world, reflect the shift away from the currency of nuclear weapons to that of nuclear energy.

  • Devaluation of Nuclear Weapons: Concerns over climate change have helped both countries move toward the “devaluation of nuclear weapons,” Singh said, with norms serving as “enforcers of change.” Yet, he also added that “quick-fix regimes” and “ad hoc-ism” are models that are increasingly inadequate for dealing with the nuclear system. India tends to be more “norm-based” in its multilateralism, while China’s multilateralism also remains more “power-based,” argued Singh.

China-South Asia Relations

Singh described how India has been traditionally sensitive to the presence of other major powers in South Asia. China’s relationship with India’s smaller neighbors, especially Pakistan, has been an issue of concern for India in the past and will remain so in the near future. One of the Chinese audience members noted that China has a responsibility vis-à-vis South Asia and must remain careful not to take sides between India and Pakistan.

  • End of Territoriality: In response to a question about whether China would become a member of the South Asian Association for Regional Cooperation (SAARC), Singh said it is a possibility. He also noted that India has an interest in becoming a full-fledged member of the Shanghai Cooperation Organization (SCO). The world is increasingly moving toward regional associations based not on proximity, but rather on “intensity-of-interest” and “intensity-of-interaction,” he said, citing that the United States is treated as “everybody’s neighbor.” As China and India become global players, they will also seek to become “neighbors” to many countries.

  • Sovereignty Under Attack: One U.S. audience member questioned the idea of an end to territoriality, citing heated domestic debates over migration and immigration. Singh responded that while nationalism is often still tied to territory, human interaction is increasingly occurring in cyber and outer space, areas without fixed national territories.

  • India’s South Asia: A Chinese audience member asked about the level to which India perceives South Asia as “India’s South Asia.” China’s growing footprint in South Asia—particularly its efforts to protect sea-lanes within the Indian Ocean—has caused some tension in the bilateral relationship. Singh explained China’s growing relations with India’s neighbors—combined with its role as the region’s largest investor—provide China with increased leverage in South Asia. While India does not perceive South Asia as belonging in some way to India, Singh said, there are concerns in New Delhi about China’s relations with India’s neighbors.

  • U.S. Ties: Saalman asked how Singh viewed President Obama’s November visit to India and what impact it was likely to have on Sino-Indian relations, given that a number of analysts have suggested the United States is looking to promote India to balance Chinese influence in Asia. Singh acknowledged such concerns, but argued that Indo-U.S. rapprochement is based on a much broader set of mutual interests than any specific targeting of China. He also noted that Indo-U.S. ties are not without their own sources of conflict.

Ongoing Tensions

The alleged rise in the number and frequency of alleged Chinese “incursions” into border regions—combined with China’s continued reluctance to support India at such venues as the International Atomic Energy Agency (IAEA), Nuclear Suppliers Group (NSG), and Asian Development Bank (ADB)—have become symbols of “deteriorating bilateral relations,” Singh argued. However, he pointed out that China and India have also cooperated successfully on military exercises—particularly anti-terrorism operations—in recent years.

  • Border Disputes: India is more concerned about the China-India bilateral territorial dispute than China is, Singh said. The border regions have a complicated history, and tense politics and cultural differences have caused a large degree of distrust over this issue. Asymmetry and differences in political culture have hindered any quick resolution of this dispute.

  • Notification and CBMs: One of the Chinese audience members pointed to confidence-building measures on the part of China and India, such as the Agreement on Confidence Building Measures in the Military Field along the Line of Actual Control signed during a visit by former Chinese President Jiang Zemin to China in November 1996. Singh stressed the importance of such measures, but argued both countries also need to be transparent about infrastructure building projects, military incursions, and other activities at the border.

  • International Scrutiny: China is coming under increasing international scrutiny. As such, India remains able to develop under less criticism and to receive greater foreign development aid, while China is being cut out of other nations’ foreign aid budgets. Still, Singh noted that for the United States, China remains a peer power and permanent member of UN Security Council. Moreover, the United States has invested more confidence in China than in India, as it asks for China’s help in reaching a peaceful solution to the North Korean nuclear agenda, while not approaching India for help on Pakistan, Singh asserted.

  • Neither Friend nor Foe: Singh concluded that China-India relations remain too complex to be explained in simplistic format of “friend” or “foe.” Instead, both constitute a mosaic of cooperation, co-existence, coordination, cooption, competition and even confrontation.