Why is India-China news again in the news spotlight?
The topic of India and China relationship is in the news because China's foreign minister, Wong Yi, was in India. During this important visit, the Chinese Foreign Minister met with Indian Foreign Minister Dr. S. Jaishankar and also held special representative talks with India's National Security Advisor, Ajit Doval. Besides, he also called upon India's Prime Minister Narendra Modi.
A few months ago, it was unpredictable, but today it is the headline. US President Donald Trump has inadvertently reignited the relationship between India and China. As the diplomacy of India and China is matching the expectations, both countries held a wide range of meetings in India. Later on this month Indian Prime Minister will visit China to attend the SCO summit and extend a hand for improving the relationship with each other that was destroyed.
This article will take you through from the scratch, where you can understand what brought the complexity between the India-China relationship, some major breakthroughs announced by India and China to improve the trade and how the tariff strategy of Donald Trump will reset the India-China relationship.
The reason for the complexity in the India-China relationship
Military standoffs
Despite the coordination in business, travel, infrastructure and academic context between India and China, some challenges persist that bring complexity to the India-China relationship. Here are some key reasons why both nations have confronted the complexity and huge challenges to maintain an amicable relationship with each other.
The Doklam crisis in 2017 over the disputed Bhutanese territory between Bhutan and China which India got involved, resulting in a serious military standoff between the two sides. After that, the Ladakh Standoff came in 2020, which lasted until last year when Chinese troops carried out multiple incursions at Pangong Lake, Galwan River Valley, Hot Spring and Gogra Sector.
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Acts as a strategic rivalry for India
Both the nations of India and China want to become dominant powers across Asia. A robust tie with China with Pakistan, through various infrastructure development projects, including CPEC (China-Pakistan Economic Corridor), has worried India a lot. The growing involvement of India with Japan, the United States of America and Australia through Quad has affected China's interest because they thought it would help India to make an effort to deter China's influence.
Dispute over Water Resources
Control over the upstream rivers, no water sharing treaty, along the hydrological data have affected the relationship between India and China in a huge manner.
Major breakthrough announced by India-China ahead of the SCO summits
Improve Border Management
Later this month, Indian Prime Minister Narendra Modi will travel to China to attend the SCO (Shanghai Cooperation Organisation) summit, which will be his first visit to China in 7 years. But these breakthroughs ahead of the SCO summit will strengthen the relationship between India and China.
India and China have agreed to develop two new groups for defining the boundary and improving border management to ensure peace holds at the border.
People, trade and connectivity
India and China both have stepped up for the development of people, trade and connectivity. For this specific front, both countries have agreed to resume direct flights by finalising a new air service agreement. It will make it easier for both nations to get visas, not just for diplomats but also for tourists, businesses and students. Significantly, it will reopen the key border trade routes.
Positive news for pilgrims
More Indians will be able to travel to Mansarovar and Kailash from next year. These are the sacred places for Hindus, which are located in Tibet. For years, thousands of Indians have made this journey, but these have been shut down completely for the last 4 years because of the pandemic and escalating border tension.
Big theme for trade
India and China have also guaranteed to reopen the border trade routes will be react with. In that case, the three important passes such as Lipulekh in Uttarakhand, Shipkila in Himachal Pradesh and Nathula in Sikkim will be reactivated. On top of that, both nations have pledged to facilitate investments to decrease the barriers and to welcome the new trade opportunities. Given that China is the largest trading partner but the relationship has been unequal. China exports more to India than it imports from India.
However, the strategic ties for trade benefits will be beneficial in restoring the balance. India would like to have better market access to China to bridge the trade deficit so that it can increase its exports. Moreover, China can be a great investor in the Indian market as it can provide sufficient funds and Technology for research, innovation and infrastructure development.
Infrastructure support
India needs a significant amount of tunnel boring machines for the metro rail projects and the tunnel projects going on across the country. In that case, China will be crucial for supplying these boring machines and rare earth elements, along with critical strategic minerals.
Trump’s tariffs reset India-China ties?
Strategic and trade alignment
The United States of America right now is posing severe challenges for both India and China because Trump’s Policies, especially the tariff wars, are threatening Indian interests. The Sovereignty and economic interest of India have been threatened by the US. Therefore, both India and China can become working partners in the field of trade to jointly counter the unconventional trade policies of Donald Trump.
Create economic pressure
The tariff moves introduced by Trump have prompted the Global companies to reconsider the China plus one strategy. India is one of the great manufacturing centres for electronics, textiles and other arenas, but the cost implications due to the huge tariff imposed by Donald Trump have affected the trade shift. In that case, the new India-China relationship can reset the new opportunities for trade and put economic pressure on the US.
Way forward
The India-China relationship is expected to bring new trade facilities to both nations, remove the tension regarding border security and uplift the diplomatic relationship between them. The cooperation between both countries will not only be beneficial for both countries to improve their economy, but it will also give an external shock to the trade policies initiated by Donald Trump. Moreover, it could compel Donald Trump to revise the trade policy strategy to maintain a friendly relationship in the geopolitical dynamics.