Amidst talk of “BRIC” countries and the “Asian Century,” the past decade has seen an unprecedented level of Western interest in the affairs of China and India. Despite the obvious differences between the two countries—China’s economy is almost three times as large, for instance—they are typically regarded as the greatest economic and political threat to Western dominance in the decades to come. In this context, scarcely a month goes by without a new book by a Western academic or journalist analyzing the growth trajectory and future prospects of the Asian powers. While China, deservingly, receives a majority of this attention, India is not far behind.

It is thus surprising, and unfortunate, that so little of this burgeoning China-India literature deals with the relationship between the two countries. After all, the potential rivalry between China and India could be the defining international issue of our times. Justifiably dubbed “the contest of the century” by The Economist in 2010, this remarkably complex relationship is often poorly understood, sometimes even within the two countries. This article will focus on bilateral diplomatic ties, rather than the wider theme of the geopolitical contest of superpowers; the latter involves much more pure speculation, and cannot be viewed in purely regional terms. I will outline the history of the relationship from the formation of the People’s Republic of China in 1949 to the present day, discuss the most problematic areas of the relationship, and examine its potential trajectory in the short-term future.

A History of (Non) Violence?

It has been widely noted by political scientists that the coexistence of India and China in the international state system is highly unusual in that they both aspire to superpower status and share a border. Fifty years ago, this border was both casus belli and battleground between the two countries. Today, it remains the source of multiple disputes. Yet the Sino-Indian border, like the wider relationship between the two countries, can just as easily be characterized as being relatively peaceful. This has been the view of many in the diplomatic community on both sides. Speaking in the 1990s, AK Damodaran, an Indian Foreign Service officer and China expert, argued that “the fact that this troubled border between the two countries had only three incidents in thirty years suggests that this is one of the quieter borders in the world.” Two decades later, the border remains remarkably quiet, given that the underlying disputes remain unresolved.

While the cultural ties between China and India go back over two millennia, independent India and the People’s Republic of China were born within three years of each other in the late 1940s. India was one of the earliest nations to recognize the PRC, rather than the Taiwan-based Republic of China, as a sovereign state. In the midst of the Korean War, Indian diplomats at the United Nations proposed UN membership for the PRC as a necessary part of any ceasefire. While the popular Hindi slogan of “Hindi-Chini Bhai Bhai” (Indo-Chinese friendship) contained an element of exaggeration, relations during the early and mid-1950s were broadly congenial. Yet while Prime Minister Jawaharlal Nehru and Zhou Enlai, his Chinese counterpart, were publicly committed to this project—as symbolized by the 1954 Panchseel Agreement, which effectively symbolized Indian acceptance of Chinese control of Tibet—it was soon undermined by three distinct disputes.

India’s border with China—its longest with any neighbor—was complicated both by China’s acquisition of Tibet and by the fact that the agreements governing the border line had been drawn up by officials of the British Empire. The border between India and Tibet, the McMahon line, had never formally been recognized by China, which now coveted Aksai Chin, a portion of eastern Ladakh in the Indian state of Jammu and Kashmir, as a means to link Tibet and Xinjiang by road. Additionally, China claimed the region controlled by India south of the eastern end of the McMahon Line, an area then administered as the North-East Frontier Agency (NEFA) and now as the state of Arunachal Pradesh, but known to the Chinese as South Tibet. This area had historically been claimed by Lhasa, but was ceded by Tibet in the 1913-14 Simla Agreement that saw the drawing of the McMahon Line. In the initial period after China’s successful 1950 invasion, India, while somewhat uneasy about the inflow of Han Chinese migrants into Tibet, nonetheless believed that the border dispute could be resolved through a joint recognition of the McMahon Line.

This soon proved impossible. In 1958, Indian officials became aware of significant Chinese encroachment across the Johnson Line (claimed by India as the international border) in the nearly uninhabited Aksai Chin. The Chinese had commenced building a highway from Tibet to Xinjiang through Aksai Chin, in what was then Indian territory. A few months later, Chinese maps began to display Aksai Chin as part of China. Indian outrage at this provocation was counterbalanced by Chinese anger at India’s decision to grant asylum to the fourteenth Dalai Lama, who fled Tibet in 1959 after a failed anti-Chinese uprising, falsely suspected by the PRC to be a CIA-orchestrated operation. Both sides felt betrayed, and a heated exchange of letters between Nehru and Zhou over the next three years was the inevitable precursor to armed conflict.

The Sino-Indian War of 1962 was, in military terms, a humiliating defeat for the Indians. For several years, KS Thimmaya, India’s Chief of Army Staff, and several others in Delhi had warned of a lack of preparedness in the face of Chinese aggression. India’s Defense Minister, the fiercely anti-Western VK Krishna Menon, chose to ignore these warnings, with dire consequences; India was routed on both the western (Aksai Chin) and eastern (NEFA) fronts. In the face of opposition from both superpowers, the Chinese swiftly withdrew, but only after securing all of Aksai Chin. The Chinese withdrawal, however, left NEFA in Indian hands.

The 1962 war transformed Indian foreign and security policy. Two years later China tested a nuclear device, and India was compelled to accelerate investment in its own nuclear program. India’s nuclear test of 1974 was just as much a response to the Chinese threat as to the Pakistani one. China was the only nuclear power in Asia, and much of the groundwork for India’s test was initiated in the immediate aftermath of the 1962 war. The near-simultaneous events of the war and the Sino-Soviet split ensured, by the early 1970s, that the Sino-Indian rivalry was now a part of the global Cold War. India signed a Friendship Treaty with the Soviet Union in 1971, while China normalized relations with the United States and developed close ties with Pakistan, a key US ally and India’s chief opponent. Yet the aid provided by China to Pakistan during its wars with India in 1965 and 1971 was far too small to alter military outcomes in either case, particularly in India’s decisive victory of 1971. Nonetheless, India’s growing closeness to the Soviet Union can justifiably be interpreted as, in part, a response to Sino-Pakistani cooperation. The Sino-Soviet split also had an impact on Indian domestic politics: it was the proximate cause of the split in the Communist Party of India (CPI), which had heretofore assumed the mantle of the opposition to the ruling Indian National Congress. The CPI itself was steadfastly pro-Moscow, but the breakaway CPI (Marxist) was pro-Chinese and remains so to this day.

The election of the Janata Party in 1977—India’s first non-Congress government—and the contemporaneous rise of Deng Xiaoping in China saw a marked, although gradual, improvement in relations. Diplomatic ties had been restored a year later in 1976 when the Chinese eventually responded to Indian overtures first made in 1969, but the new governments in both countries departed from the previous policy of placing Sino-Indian relations in the contexts of Sino-Soviet and Indo-Pakistani conflicts. The Janata government was more genuinely non-aligned than pro-Soviet, and Deng Xiaoping, for his part, even suggested the possibility of a Chinese acknowledgment of Indian sovereignty over NEFA in exchange for India’s relinquishing of its claim to Aksai Chin. While such measures have never been adopted, a similar principle motivated the 1993 and 1996 agreements on a Line of Actual Control. In 1996, Jiang Zemin made a state visit to India; several such visits have followed since.

The past two decades have witnessed an unprecedented explosion of economic ties. In 1987, bilateral trade was a paltry US $117 million; by 2011, it was over US $70 billion. Both sides forecast that annual Sino-Indian trade will break the US $100 billion mark by 2015, if not sooner. In the process, however, the trade surplus that India enjoyed in the early 1990s has become a US $27 billion trade deficit. While China remains Pakistan’s closest regional ally, and the border dispute remains officially unresolved, Sino-Indian history since 1962 is essentially a history of non-violent, if often unfriendly, coexistence.

Challenges

The border dispute remains, particularly in the short-term, a primary source of friction. While it is not an “active” dispute in a military sense, it regularly manifests itself in the course of Sino-Indian relations. In 2009, for instance, China was incensed by the Asian Development Bank’s decision to grant funds to a project specifically allocated to “Arunachal Pradesh.” China was able to exercise its diplomatic muscle successfully: the Bank was forced to remove all references to Arunachal Pradesh. For several decades, China’s rhetoric on Arunachal had been relatively muted, but it has been ramped up considerably since 2006. Current Chinese policy is to claim all of Arunachal as part of China. The Indian response has been to increase troop presence in Arunachal, as well as the larger neighboring state of Assam. Yet the Indian military buildup is dwarfed by the 400,000 People’s Liberation Army (PLA) troops near the Sino-Indian border.

While the more hawkish elements in the Indian strategic community see all this as a cause for alarm, the Indian military establishment offers a more sober analysis. While the incidences of Chinese “intrusion,” accidental or otherwise, have steadily increased, the vast majority of these have been minor and caused by confusion over the exact Line of Actual Control. It is simply inaccurate to state that China and India have an ongoing “hot” border conflict. Nonetheless, China’s inflamed rhetoric ought to be taken seriously. It is impossible to rule out small-scale clashes over the border in the future, although the idea that Arunachal will trigger another full-scale war is far from plausible.

The end of the Cold War and the long-term peace between China and India did not deter Sino-Pakistani relations from improving as well. China and Pakistan see each other as a bulwark against India. China has long since replaced the United States as Pakistan’s largest military supplier, as well as its only supplier of nuclear technology in the post-AQ Khan era. In October 2011, India registered with Beijing its objection to the presence of at least 3,000 PLA troops in Azad Kashmir, the territory claimed by India, but administered by Pakistan since its seizure in the Indo-Pakistani war of 1948. China’s decision to station PLA troops in an area central to the Kashmir dispute is clear evidence of an abandonment of any pretense of neutrality on the issue. This has clear potential to impede the betterment of Sino-Indian relations in the future.

While the rapid expansion of bilateral trade is by far the most positive long-term development in relations between China and India, even economic ties can be a source of tension. Much of the illegal mining in the southern Indian states of Karnataka and Andhra Pradesh, which is responsible for environmental degradation and massive instances of political corruption in the region, was linked to growing Chinese demand for iron ore, which was being smuggled to China. Most recently, a business dispute between Indian traders and locals in the Chinese city of Yiwu led to the alleged kidnapping and torture of Indians, who were accused of reneging on agreements.

Finally, the continued presence of the Tibetan government-in-exile in the Indian mountain city of Dharamshala is a permanent cause of Chinese frustration, albeit one that is rather peripheral to the relationship as a whole.

Prospects

There is virtual unanimity among strategic scholars in Asia and the West that the theater for a Sino-Indian military rivalry is the Indian Ocean. India’s naval buildup is a direct riposte to the notion of a Chinese “string of pearls”—a network of economically valuable ports and other assets. Yet the Indian tendency to see China’s Indian Ocean policy as one of military dominance rather than economic self-interest—a view taken in light of the launch of China’s first aircraft carrier in 2011—is excessive. It is symptomatic of a dichotomy that has been observed by, among others, Kishore Mahbubani, a veteran Singaporean diplomat and commentator on Asian affairs. Mahbubani notes that while in India, China is seen by the strategic establishment and the media as a virulent threat, Chinese coverage of India is much more positive. This is, of course, a reflection of the fact that China sees the United States, rather than India, as its equal; India is simply not its primary rival. Nevertheless, it is an observation that ought to give Indian policymakers pause.

The trajectory of Sino-Indian relations is contingent on future economic and political developments within the two countries. Economic growth in India and China slowed in 2011. In the former, this was a consequence of policy paralysis; in the latter, it may be the beginnings of a longer-term change in growth trends. Even if Chinese growth slows to an annual rate of five percent, however, it would take India at least two decades to catch up with the size of the Chinese economy (India’s GDP was virtually equivalent to China’s as recently as 1990). Without sustained, rapid Indian economic growth, the relationship between China and India will not turn into a relationship of co-equals from the Chinese point of view. Political transition towards greater democracy in China could open up possibilities for much closer cooperation. India and China have both been guilty of abetting the suppression of democracy in Myanmar; if China embraces democracy, the onus will be on these countries, as regional powers, to promote democratic values throughout the region. Even on the most optimistic forecast, however, any such development is a decade away.

China and India have much to learn from each other, although sadly little learning takes place. India offers an example to China of the relatively peaceful integration of ethnic and religious minorities. Quite apart from China’s economic growth, India should also attempt to match its successful regional diplomacy. Over the past few decades, India has squandered its in-built advantage as the leading power in South Asia by developing a reputation for high-minded arrogance. As a result, China has developed close ties with Nepal, Bangladesh, and Sri Lanka—countries within India’s historic sphere of influence. Without much fanfare, China has also embarked on a serious-minded program of developing sustainable sources of energy—something to which India has given insufficient attention.

American observers will naturally seek to place the Sino-Indian relationship in the context of US foreign policy. To do so with any certainty is, at the moment, virtually impossible. In an election year, both Republicans and Democrats deploy Sino-phobic rhetoric, and China has begun to halt the appreciation of renminbi. This ought to present a rare opportunity for India to press its claim as the United States’ closest ally in Asia and as a bulwark against China. However, Indo-US relations have failed to progress since the hugely successful visit of President Obama to India in 2010. They have fallen victim to the wider malaise in Indian policymaking over the past two years.

China’s heightened rhetoric over Arunachal Pradesh and its closeness to Pakistan, when juxtaposed with anti-Chinese sentiment in India, suggest a gloomy prognosis for future ties. China is the only permanent member of the UN Security Council to refuse to support India’s bid for a permanent seat on that body. But the relatively peaceful reality of the disputed border and burgeoning trade between the two countries suggest that India and China have a much greater need to cooperate than they acknowledge. A close friendship—“Hindi-Chini Bhai Bhai” redux—is certainly not in the cards. But the two countries can, and ought to, aspire to much better than an Asian version of the Cold War, or even the peaceful, yet uneasy coexistence of the 1970s and 80s. A true global “pivot” to Asia, and the accompanying claims of an Asian Century, is much more plausible if Asia’s two largest countries see the productive potential of more mature and responsible ties.