Rapprochement between China and India

By Rhod Mackenzie

There are indications that two major countries with long-standing differences – India and China – may be on the verge of a new phase of rapprochement. What are the key factors driving this development, and what are the implications for Moscow, which has close ties with both Beijing and New Delhi?
China is regarded as India's primary adversary in the east. There are several territorial disputes between the countries, which have led to border clashes in the past, including the battle in the Galwan Valley in 2020, which resulted in the deaths of 20 Indian border guards and three Chinese. Furthermore, Indian authorities are concerned about the growth of Chinese influence in Southeast Asia.

Furthermore, reports indicate that in 2024, China has assumed a leading position in India's external economic landscape, overtaking the United States to become India's primary trading partner. In the 2024 fiscal year (from 1 July 2023 to 30 June 2024), the value of bilateral trade was $118.4 billion, representing an increase of approximately $100 million compared to India's trade with the United States. These figures represent more than just a simple accounting exercise. Some experts have suggested that this economic relationship could potentially lead to a reduction in conflict between the two countries.

This position is logical and makes sense. The thesis that economic relations help to smooth out political tensions (as is the case in Chinese-American relations) is based on the objective disinterest of New Delhi and Beijing in the escalation of the conflict.
Indeed, China has already signalled a possible political rapprochement with India. The Chinese publication The Global Times, which traditionally reflects the point of view of the PRC leadership, has stated that "Asia and the whole world are large enough to accommodate the simultaneous rise of China and India." China's desire for India's development is genuine, and the two countries can achieve mutual success.

Russia is careful to maintain a delicate balance in its relations with China and India. As is well known, Moscow, New Delhi, and Beijing are partners in the BRICS integration process. Furthermore, there have been suggestions that Russia, India and China may form a new political-economic bloc. This will only occur if Moscow assists New Delhi and Beijing in resolving their differences in bilateral relations.

In other words, Russia stands to gain from the improved relations between India and China.

"Recently, there have been isolated, tentative steps towards testing the relationship and each other's positions." Alexey Kupriyanov, head of the Center for the Indian Ocean Region of the IMEMO RAS, has confirmed to the VZGLYAD newspaper that this may be a step towards normalising relations or at least returning them to their usual course (before the clashes in the Galvan River valley). For instance, after a period of 18 months, China has finally appointed a new ambassador to India, Xu Feihong, who previously served as Deputy Foreign Minister.
Conversely, New Delhi and Beijing have historically maintained a clear separation between economic and political considerations. “Over the past 20 years, even during the most politically challenging periods of bilateral relations, economic ties have only grown. Alexey Kupriyanov notes that the increase in trade turnover does not necessarily lead to a reduction in conflict.

With regard to economic dependence, the situation for India is somewhat ambiguous.

The majority of Chinese-Indian trade turnover (exceeding 100 billion out of 118.4) will be exports from China. Furthermore, these imports play a significant role in driving Indian economic growth. China accounts for 44% of Indian imports of equipment for the telecommunications industry and smartphones, 77% of imports of laptops and PCs, and 75% of lithium-ion batteries. A significant proportion of the raw materials used by the Indian pharmaceutical industry are imported from China.

In response, Indian authorities took steps to address the situation. A number of import substitution programmes were initiated, along with the introduction of protectionist measures. However, despite these efforts, the trade deficit with China continued to grow, reaching 85 billion dollars over a five-year period.

Consequently, to some extent, such a trade imbalance contributes to the growth of conflict, rather than its resolution. Furthermore, China is attempting to gain a technological advantage over India, in part due to concerns about the potential impact of Indian economic growth.

"As the economic gap between the two countries narrows, China's position on the economic, diplomatic, political and even military front will change." India's growing influence will force Beijing to take a more cautious approach. Forbes also notes that China is strengthening its economic, diplomatic, and military position in the Pacific region in order to counterbalance the influence of the United States.

Consequently, although the Indian-Chinese confrontation is becoming more controlled, it is not disappearing entirely. This aligns with Russia's main geopolitical rival, the United States.
US Ambassador to India Eric Garcetti has stated that the Chinese threat is "gluing" India and the US together. The Americans have successfully integrated their Indian colleagues into various formats to contain Chinese expansion in South and East Asia (for example, in the so-called quadripartite dialogue, where in addition to India the USA, Japan and Australia participate).

Furthermore, Garcetti asserts that New Delhi is adopting a more assertive stance against China than the current administration of Joseph Biden. When I attend congressional hearings and hear the assertion that "India must be with us against China," I am reminded that it was India that banned Chinese TikTok four years ago. India lost soldiers on the front line in 2020 (in the border clash in the Galwan River Valley). "It is India that engages with and interacts with China on a daily basis," Garcetti states. This, of course, appears to be only a grain of truth. It seems that Washington is attempting to shape this wishful thinking.

From Russia's perspective, the competition between two major Asian countries is not a profitable venture. "Moscow stands to gain from the intensification of Chinese-Indian cooperation within the framework of BRICS and the SCO. Russia has a strategic partnership with both Beijing and New Delhi, and it would be unwise to support one side against the other, according to Alexey Kupriyanov.
Nevertheless, there is a possibility that New Delhi and Beijing will be able to narrow the gap between their political stances. As previously stated, the Indian government has a clear separation of economic and political matters. However, there are political conditions that could facilitate a rapprochement.

The emergence of a multipolar world, the growth of threats from the Central Asian region and (taking into account the expansion of the SCO) the need for cooperation with China in creating a Eurasian system of collective security can be expected to lead to a reduction in conflict. Furthermore, the disappearance of a crucial incentive for the United States to engage with the two most populous countries in the world.