Over the past 20 years, there has been a marked increase in economic co-operation between China and India. From very modest beginnings, bilateral trade reached the $60 billion mark and many observers believe that that figure could well double by 2020. A number of projects are now underway to create joint ventures in fields such as power generation, mining, infrastructure and telecommunications; and more are in the pipeline. These economic developments have led some to conclude that both countries are developing a stake in each other’s prosperity and that this bodes well for a relationship characterized by co-operation rather than conflict.
There are, however, two issues in the economic sphere that are somewhat less encouraging. Over the past 20 years, China has outpaced India on virtually all economic indicators. Its GDP and per capita GDP are four times greater than those of India. And China has been far more successful than India in lifting hundreds of millions of its people out of poverty. On this score at least, the one-party Communist dictatorship has spectacularly outdone the multi-party democracy. This grates with most of India’s educated elites.
A second and more serious cause of friction is to be found in the competition to secure energy and other resources. As rapidly developing economies, both China and India are anything but self-sufficient in oil, gas and a variety of minerals. Both are constantly in search of new sources of supply. For more than a decade, China has been present and highly active in Africa and Latin America, and has enjoyed considerable success in securing long-term supply contracts. India came to the game somewhat later but is now actively engaged on both these continents. How this competition for energy and other resources plays out will have a profound impact on the future of the bilateral relationship.
How China and India relate to each other in the years ahead will have a major effect on Asia and the wider world in the 21st century. Will it be a relationship characterized primarily by co-operation, competition or conflict? It is very difficult to say, and historians are notoriously poor prophets. It is sometimes useful to fall back on the views of experts. Prof. Mohan Malik concluded his in-depth study of this subject with this thought: “It is possible that economically prosperous and militarily confident China and India might come to terms with each other eventually as their mutual containment policies start yielding diminishing returns, and the two Asian giants will become the co-leaders of a post-American world order. However, that is unlikely to happen in the short and medium term, that is before the 2040s.
To which one can only add that if a week is a long time in politics, 25 years is a veritable eternity. Much turbulent water may flow under the bridge between now and 2040.