Progress in Sino-Indian Relations: Indian and Chinese Top Leaders Meet
This past week, the top leaders from India and China agreed to deepen their economic relations and to try to resolve their differences over security issues. As India continues to seek foreign investment for economic growth, the meetings could prove beneficial for India’s development and security goals.
India’s External Affairs Minister Sushma Swaraj wrapped up a three day trip to Beijing on Monday in which he met with China’s leaders, including President Xi Jinping. Experts have noted it a rare event for China’s leaders to meet with a visiting foreign minister. The meeting with President Xi and Minister Swaraj shows the importance which China ascribes to its relationship with India. In addition, China’s state newspaper, Xinhua, applauded the meeting, calling India’s diplomacy “conducive to world peace” and “pragmatic”. Taken together, the endorsement of the meeting by Chinese state media and the fact that Swaraj was accorded a personal meeting with President Xi demonstrate that the relationship between India and China is moving in a positive direction.
During the meeting, China promised to endorse India’s membership to the 21-Nation Asia-Pacific Economic Cooperation (APEC), one of the Asia-Pacific region’s premier economic forums. Its main goal is to foster economic growth and positive relations among all nations in the Asia-Pacific region through trade and investment. Given China’s regional and economic clout, its endorsement of India to APEC would be incredibly helpful for India. Membership in APEC would allow India to develop stronger trade and investment relations with other Asian-Pacific countries, laying the foundation for stronger economic growth.
China also agreed to follow up on its promise to invest in India’s economy. In September 2014, President Xi Jinping pledged that China would invest USD 20 billion in India’s economy over the next five years. The recent meeting between President Xi and Minister Swaraj highlights China’s commitment to its financial pledge as India enters a crucial phase of its development. Last September, India’s Prime Minister Narendra Modi announced “Make in India”, an ambitious economic campaign aimed at increasing the share of India’s GDP which the manufacturing sector constitutes from 15 percent to 25 percent. However, as Western foreign investment in India continues to decline, China’s promise of investment in India will no doubt be significant for India’s development goals .
Furthermore, China and India managed to lay the foundation for future security talks. Over the past few years, China has developed plans to build a series of deep water ports throughout the Indian Ocean. These strategic ports have been designed to reduce China’s dependence on the Malacca Straits, the channel through which China imports most of its oil. Yet, China’s strategic goals could put it in direct conflict with India’s security interests. As India continues the development of its manufacturing sector it will depend more and more on the Indian Ocean for trade. Therefore, Prime Minister Modi hopes that China’s expansion in the Indian Ocean will not lead to a militarization of the region, which would inevitably threaten these trade routes. Although China and India did not reach a formal agreement to resolve these security issues, the meeting between their top officials should provide the groundwork for future talks.
Despite its apparent success, the meeting between India and China highlights India’s difficult balancing act in the Asian-Pacific region. A few weeks ago, US President Barack Obama finished a productive meeting with Indian Prime Minister Modi. The two leaders managed to agree on numerous issues, including climate change, nuclear power, and the security of the Asian-Pacific region. Apparently unnerved by the cosiness of the meeting, China’s state-run newspaper ran an article criticizing the meeting, describing as superficial and arguing that the United States and India would never be on the same page on important issues. There were worries in India that the close relations between India and the US would even hurt India as it sought endorsement of its APEC bid and additional foreign investment from China. Although these fears did not come to fruition, the recent events still highlight India’s strategic dilemma. As the tension between the US and China mounts, India may find it increasingly hard to straddle between the two and its current comfortable position hard to maintain.