By Invitation | A New Day of China-India Relations

Only if the two sides maintain trust instead of suspicion and manage their differences through dialogue can they create a brighter future through cooperation

Lan Jianxue

As the two most renowned ancient civilisations in the East and the two largest developing countries and emerging markets, not to mention the only two countries with a population of more than a billion each, China and India have become two important forces in promoting global multi-polarisation process and driving Asia’s economic growth in the 21st Century.

Chinese state councilor and foreign minister Wang Yi and Indian external affairs minister Sushma Swaraj

The global environment is now undergoing profound changes, the international order is becoming more balanced and the trend of peaceful development has become irreversible, but instability and uncertainty persist. Peaceful, stable and balanced relations between China and India are an important and positive factor for world stability.

The leaders of the two countries met four times in 2018, effectively promoting a ‘closer partnership for development’ between China and India and significantly enhancing strategic mutual trust. Chinese President Xi Jinping and Indian Prime Minister Narendra Modi held an informal meeting in Wuhan in April 2018, which ended up as a major event in the history of China-India relations. The two leaders conversed with each other for a long time, conducted in-depth strategic communication, made major political decisions, and created a new mode of high-level communication between China and India.

The ‘closer partnership for development’ between China and India is now moving forward steadily, but that is not enough. The two countries should also commit to building a higher-level strategic and cooperative partnership. As Prime Minister Modi said, ‘To describe the potential of India-China ties most succinctly, it’s an INCH (India and China) towards MILES (Millennium of Exceptional Energy).’


Core Obstacles

First, political consensuses have yet to become political realities. During their meeting in Wuhan, President Xi and Prime Minister Modi reached important consensuses. For example, China-India cooperation outweighs the differences between them, as the two countries are neighbours, friends, and partners. Development and growth of the two countries is a necessity and presents reciprocal important opportunities for the other. It would be vain to hope to curb the national revival of either China or India — instead our two countries should promote wide-ranging cooperation, build a closer partnership based on the principles of equality, mutual benefits and sustainable development, and properly handle the differences by managing them as part of bilateral relations.

In the wake of the meeting, relevant authorities of the two countries should resolutely make the leaders’ political consensus a reality. The relationship between China and India is full of hope and forward momentum. Only if the two sides maintain trust over suspicion and manage their differences through dialogue will they be able to create a bright future through cooperation.

Second, the potential for economic and trade investment needs to be further tapped. China and India employ different economic structures that complement each other in terms of software and hardware. As of November 2018, China was India’s third largest export destination and largest import source. According to Indian Business Information Agency statistics, from January to November 2018, bilateral trade volume between China and India totalled USD83.26 billion, up 8.5 per cent. Indian export volume to China was USD15.04 billion, up 31.8 per cent, and the figure accounted for 5.1 per cent of India’s total exports, up by 0.9 percentage points year-on-year. Meanwhile, the Indian import volume from China was USD68.22 billion, up 4.4 per cent, and the figure accounted for 14.5 per cent of India’s total imports, dropping by 1.5 percentage points year-on-year.

As for two-way investment, by the end of March 2018, India had invested in a total of 1,636 projects in China, amounting to USD861 million. China’s non-financial direct investment stock to India was USD3.46 billion. Clearly the potential for economic and trade investment cooperation between China and India has yet to be fully tapped considering the economic size of the two countries. India should further expand its exports of goods and services to China, and China should further facilitate the process of investment in India.

Third, the foundation for people-to-people exchange is weak. Considering that China and India are ancient countries with great civilisations, the written history of China-India communication spans more than 2,000 years. The introduction of Indian songs and dances, astronomy, calendar, literature, architecture and sugar manufacturing technology — just name a few — to China and the introduction of Chinese paper making, silk, porcelain, tea and music to India preserve evidence of a lengthy history of mutual exchange and mutual learning between the two peoples since ancient times.

Unfortunately, in an era of information and communication technology, a huge cognitive gap persists between Chinese and Indian peoples today. For instance, before visiting India, many Chinese tourists worried that they wouldn’t like Indian cuisine, that the drinking water would be contaminated or that their personal security would be at risk. Similarly, before departing to China, first-time visitors from India often worried whether they could access the internet and travel without limitations in China. Today, most reports on China from India’s mainstream English media outlets remain gloomy and pessimistic, with ongoing extensive bilateral cooperation ignored.

Misunderstandings, rumours, and even hostility will melt only when the two peoples get to know each other better. Fortunately, the top leaders of both countries are aware of this and have agreed to establish a mechanism to advance people-to-people exchange.

Fourth, third-party factors and historical issues are sabotaging bilateral relations. The intrinsic value of China-India relations drives the development independently of third-party factors. However, third-party factors such as the United States and Pakistan have at times impacted relations between the two countries. For example, when India falls into conflict with Pakistan over the Kashmir dispute and ‘cross-border terrorist attacks,’ the Indian media tend to blame China. Meanwhile, the Chinese media usually overstates the United States’ influence on India’s policymaking, is a little bit too sensitive about reporting on interactions between the United States and India and lacks confidence in India’s ‘Strategic Autonomy.’ Other historical issues such as the boundary question and the Dalai problem still sour bilateral relations from time to time and hamper the upgrading of strategic mutual trust between the two countries.


Minimising the Trust Deficit

First and foremost, unswervingly adhere to the consensus that China and India are partners that present development opportunities for each other. Disagreements between neighbours are inevitable, but they can always be resolved through peaceful consultation. At the same time, we cannot just focus on differences while neglecting friendship and cooperation, and we must not leave our countries’ revival and the overall situation of bilateral relations vulnerable to third-party interference. As two ancient civilisations, China and India should maintain strategic communication and explore ways to increase friendship across the continent. The belief that China and India are natural partners needs to be widespread throughout the general public of both countries in addition to leadership.

Second, make good use of economic complementarities between the two countries and expand common interests. We should improve market access to each other, promote trade liberalisation and investment facilitation, and sign trade agreements to promote free trade. We also need to emancipate our minds to broaden the bilateral trade relationship. This year marks the 40th anniversary of China’s reform and opening. Over the past 40 years, Chinese experience can be summarised as: ‘Becoming open and inclusive leads to national long-term prosperity.’ Sometimes, everything falls into place when minds are broadened. Freeing the mind can be a huge productivity booster.

Third, solidify the foundation for friendly public opinion through a closer people-to-people exchange. Our two countries have had rich material and spiritual legacies fueled by people-to-people exchange for thousands of years. The China-India relationship is a historic model for communication and mutual learning between civilizations. Even during periods of setbacks in political relations, people-to-people exchange and non-governmental exchange between China and India have never been interrupted. China and India are fundamental pillars of Oriental multiculturalism, which highlights experience and intuition with focus on long-term perspectives, comprehensiveness, ethics and morality, self-examination and self-reflection and harmony between nature and humanity. People across Asia uphold peace and love and cherish ‘harmony with differences’ and ‘strength in diversity’, among other values.

China and India are fully capable of cooperating to optimise the charm of Oriental civilisations and cultures for the world. We can create equal, two-way, and mutually beneficial cultural exchange and build a stable and reliable relationship of strategic mutual trust based on profound people-to-people exchange.

Fourth, eliminate negative impact from third-party factors by remaining strategically determined. Facing a rapidly evolving and complex domestic and international situation, China and India must stay strategically focused. We should not let short-term ups and downs cause tunnel vision. Both China and India have firmly adhered to the policy of independence and peaceful development and cherish their strategic autonomy. India enjoys great prestige in the Non-Aligned Movement, has a strong independent national character, and upholds its own values and principles in foreign exchange without following others blindly. These national characteristics are greatly appreciated by Chinese people and form an important cornerstone for India to build its place in a multi-polar world.

Those who attempt to leverage India as a pawn for their own interests should recall carefully the magnificent history of the Indian people’s indomitable struggle for national independence.

(The writer is Deputy Director of the Department for Asia-Pacific Studies, China Institute of International Studies)

This content is provided by Beijing-based China-India Dialogue. 


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