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    South Asia
     Dec 11, 2012

Sino-Indian ties border on the amicable
By Brendan O'Reilly

New dynamics are emerging in the crucial Sino-Indian relationship. The two Asian giants are developing deeper global cooperation, while at the same time remaining stuck in a pattern of regional rivalry. Their disputed border, India's involvement in the growing confrontation in the South China Sea, and the US "pivot" towards Asia steer the Sino-Indian dynamic towards a combative condition. At the same time, profound changes in the global balance of political and economic power are opening up vital new areas for cooperation.

Recent developments demonstrate contradictory undercurrents in the bilateral relationship. High-level talks in Beijing between the

two powers concluded last week regarding their disputed border are a sign of a positive momentum. A series of negotiations have been going on since 2005. The current phase of the talks center around building a diplomatic framework in which the final border can be demarcated.

Indian National Security Adviser Shivshankar Menon was cautiously optimistic about the negotiations: "Overall, when we looked at our relationship and when we looked at the boundary, we have actually made considerable progress and we handled the relationship well. The border is peaceful and we made progress towards settlement." [1]

Dai Bingguo, Menon's Chinese counterpart in the talks, was considerably more enthusiastic. In an interview with Indian media, Dai said: "Nothing is impossible to a willing mind. As long as we are devoted to staying friends forever, never treat each other as enemies, pursue long-term peace and friendly co-existence and vigorously promote win-win cooperation, we will be capable of creating miracles to the benefit of our peoples and the entire mankind." [2]

Such optimistic rhetoric demonstrates China's deep strategic interest in maintaining an amicable relationship with India. China is keen on wooing India away from the budding regional anti-Chinese alliance of the United States, Japan, and the Philippines. The Chinese government wants to improve relations with India and settle the border to the west in order to have more strategic maneuverability against Japan and the Americans in the Pacific.

When asked about the US pursuit of India as a potential regional ally, Dai said, "In my view, India is a country of strategic independence. It will not be wooed or ordered about by anyone else. Being a forerunner of the Non-Aligned Movement and a large emerging country with growing international influence, India will stick to its traditional independent foreign policy and contribute to the peace and development of the region and beyond."

Regional confrontation
However, at the same time as promising negotiations may be leading to a settlement on the disputed Sino-Indian frontier, China's new regional assertiveness has inspired a particularly combative Indian response on another front. Although India is not a claimant in the South China Sea territorial dispute, there are vested Indian interests in the region. The state-run Oil and Natural Gas Corp (ONGC) has a joint natural gas development program with the Vietnamese government in the disputed waters, and has invested over US$600 million in the project.

Last week, Vietnam accused Chinese vessels of sabotaging a Vietnamese exploration operation by severing a seismic cable. In response, Indian Navy Chief Admiral DK Josh publicly stated the capability of the Indian Navy to become involved in any potential conflict: "When the requirement is there, for example, in situations where our country's interests are involved, for example ONGC... we will be required to go there and we are prepared for that… Now, are we preparing for it? Are we having exercises of that nature? The short answer is yes." [3]

Open willingness on the part of the Indian Navy to deploy in the South China Sea is an indication of an increasingly proactive Indian stance. The Chinese Ministry of Foreign Affairs was of course none too pleased with Admiral Josh's announcement. Spokesman Hong Lei, in apparent response to Indian military commitments to protecting their Vietnamese investments said: "China opposes any unilateral oil and gas exploration activities in disputed areas in the South China Sea and hopes relevant countries respect China's sovereignty and national interests, as well as the efforts of countries within the region to resolve disputes through bilateral negotiations." [4]

However, in recent weeks the Chinese government has also made moves to exacerbate the regional contention with India. Newly printed Chinese passports contain a map that shows the border regions disputed with India as an integral part of Chinese territory. India's Ministry of External Affairs has condemned this representation as "unacceptable" and is issuing special visas to Chinese citizens with a map detailing India's land claims.

Why are the Indian and Chinese governments goading each other at the same time as making progress on resolving their disputed border? The explanation for these rather schizophrenic foreign policy moves is primarily rooted in domestic politics. Neither side can afford to look weak in front of their longtime rival.

In India, this dynamic is on full and open display. Memories of the disastrous 1962 border war, and fears of China's growing power, feature prominently in Indian politics [5] (see Ghosts of '62 can't rest in peace, Asia Times Online, October 31, 2012). Opposition Member of Parliament Lalji Tandon questioned the entire validity of the ongoing Sino-Indian border talks: "There is no commonly delineated Line of Actual Control in the border areas between India and China... There is no clear agreement on it between us. Our understanding of where the border is differs from theirs." [6]

China's political system is much more opaque and centralized. However, it stands to reason that there are elements in the Chinese political structure that have a particularly hawkish attitude towards India. These elements may have been behind the move to print the map containing disputed regions on new Chinese passports.

Of course, there are others explanations for the simultaneous friendly and confrontational gestures from the Indian and Chinese governments. Certain regional dynamics in the Sino-Indian relationship appear to take the form of a zero-sum game: what benefits one power harms the other. By simultaneously making confrontational moves and conciliatory rhetoric, India and China are using both carrots and sticks to achieve their diplomatic goals.

Global cooperation
While China and India remain regional rivals, they are increasingly cooperating on a global scale. The two nations share similar positions regarding international trade, internal development and the emergence of a new multipolar system of world power. The Asian giants have offered each other diplomatic support in several key areas. For example, India and China have offered mutual support in the critical areas of climate change and reforming the system of international finance.

In February, the Indian government proposed the establishment of a BRICS Development Bank as an alternative to the World Bank and the International Monetary Fund (IMF). Financial cooperation between the emerging economies of Brazil, Russia, India, China, and South Africa would be a game-changer for the system of international finance. The World Bank and IMF remain largely dominated by the United States and its allies - Japan has nearly twice the voting power of China in the IMF despite having a smaller total economy.

Zhu Guangyao, China's vice-minister of finance, is very enthusiastic regarding the Indian proposal for creating the BRICS Development Bank: "Underdeveloped infrastructure is still a bottleneck for economic development in some emerging economies and needs massive credit support. We hope the establishment of the BRICS Development Bank will help better support these projects. Amid weak global trade, which will grow by only 2.5% this year, it is a common obligation for BRICS countries to fight against trade protectionism and unleash their potential." [7]

China and India find themselves in a de facto alliance to champion the cause of rapidly developing nations. As the economies of the rich countries continue to falter, China and India share a similar desire to enhance their international standing. Furthermore, there are deepening trade and investment ties between the two nations. China is India's largest trading partner.

Even regionally, India and China have similar strategic concerns. Both powers feel surrounded by potentially hostile states. Just as India feels geographically constrained by Pakistan and China, China feels similarly uneasy due to the proximity of Japan, America's massive Pacific fleet, and India itself. Both nations stand to gain considerable strategic maneuverability from defining their shared border and maintaining friendly relations.

In certain areas of Sino-Indian contention - such as access to energy resources in the South China Sea - contention is all-but inevitable. However, both powers must be careful to promote their interests without making the other side lose face. Realpolitik posturing is acceptable, but insults to the national dignity of either rival power can have serious domestic repercussions, and could push the relationship into open hostility.

Contradictory signals from China and India in recent days point to the emergence of a stable and amicable rivalry. Both powers have much to gain from secure bilateral relations, and much to lose from forming a hostile relationship. If China and India can show sufficient respect to each other and cooperate in their mutual interest, then the two powers may secure regional peace and radically alter the balance of global power.

1. Border talks: India, China reach 'understanding', the Indian Express December 5, 2012.
2. India, China should cast off shadow of history, move forward: Dai, Oman Tribune, December 6, 2012.
3. Indian navy ready to deploy to Sth China Sea as tensions climb, Khaleej Times, December 4, 2012.
4. China hits back at Indian navy chief, Hindustan Times, December 5, 2012.
5. Ghosts of '62 can't rest in peace, Asia Times Online, Oct 31, 2012.
6. Uproar in LS over India-China border dispute, Business Standard, December 5, 2012.
7. BRICS nations to deepen ties, China Daily, December 5, 2012.

Brendan P O'Reilly is a China-based writer and educator from Seattle. He is author of The Transcendent Harmony.

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