Tackling China, regionally

There was a time when the troubled Sino-Indian relationship appeared to be the dominant feature of China's presence in the Subcontinent. The tussle between India and the People's Republic went beyond bilateral affairs, to shape the direction of China's engagement with the rest of Southasia as well. Wary of Beijing's intentions, New Delhi has always been watchful of China's relationships with the smaller neighbours, which further intensified mistrust between the two Asian giants.

The noticeable improvement in the Sino-Indian relationship today stands in sharp contrast to India's dealings with its regional neighbours, which tend to be problem-prone and crisis-ridden. For the first time since 1962, a state of affairs currently prevails such that the India-China bond generates greater optimism than the Southasian relationships.

Indeed, Sino-Indian relations are on the upswing in all spheres – political, economic and cultural. The once-intractable border now appears less formidable as a barrier to improved relations, and the two capitals have managed to overcome the diplomatic difficulties that surfaced in the wake of Pokhran II. Controversial issues remain, including misgivings about China's strategic objectives, especially with regard to its military ties with Pakistan, and yet a framework and mechanism for dealing with problems is in place and appears to be working. There is now ongoing dialogue at various levels.

But it is too early to describe the Sino-Indian relationship as vibrant. Today, it can be likened to an inverted pyramid: the broadest level of interaction is at the top, among a host of senior politicians, officials and members of government-sponsored delegations. The next level is made up of a few members of academia, media and think tanks, engaged in formulating a broader framework for collaboration and research. It is at the people-to-people level that the relationship is at its narrowest, with interactions between India and China virtually non-existent.

Tourist exchanges between the world's two most populous nations are minimal. Chinese and Indians know very little about each other, and popular perceptions tend to be out of sync with evolved realities. For example, the views of even better-informed Indians on the People's Republic are limited to its economic rise on the one hand and, on the other, the belief that Beijing has designs on Indian territory.

Building regionalism

To derive maximum benefit from the relationship with China, India must study how Beijing itself has crafted effective economic regionalism within its East and Southeast Asian neighbourhood. Not only would a strong cooperation model in Southasia build up the regional economy for its own sake; this would also make it easier for Southasia and India as a whole to engage with China.

Southeast Asia provides an illuminating example of how strong trade links can benefit all countries involved. When China began opening up to the outside world, the first response of its smaller neighbours to the south and east was deep suspicion. In less than two decades, however, there has been a complete turnaround, with China engaged in flourishing partnerships. Beijing has effectively played the role of economic driver in the region, and a China-ASEAN free trade area is on the anvil, which would have an estimated GDP of about USD three trillion.

There is obviously an element of long-term calculation as Beijing sets about establishing a high degree of interdependence with the other economies of the Asian-Pacific region, but today there is unambiguous acceptance of China's central role in any regional economic formation. Almost half of China's total trade today is intra-regional, and where trade is not balanced the smaller neighbours have been 'conceded' trade surpluses. Such policies have given great impetus to regional economic growth, such that investments are starting to be made across borders.

In strong contrast to China, India has been unable to emerge as the principal moulder of the economic order of its own region. Besides the absence of stronger trade linkages between the countries of SAARC – and perhaps because of it – the region is rife with inter-state differences, mainly between India and each of the Southasian neighbours.

The China card

It was following the 1962 India-China border conflict, when the latter laid the foundations of its enduring entente with Pakistan, that Beijing came to be seen by other Southasian states as a useful countervailing power to big India. China was not averse to capitalising on the leverages this offered. Such a scenario is obviously not productive in the long term, because ultimately Southasian states have to devise ways of coping with the challenges to their security and development within a cooperative framework. For its part, since the mid-1990s Beijing has overtly adopted a more 'balanced' approach towards Southasia, especially with regard to the India-Pakistan scenario.

At the same time, there is no escaping that China's presence in the Subcontinent is impressive, the economic largesse distributed to India's smaller neighbours significant, and its cordial relations with all of them in sharp contrast to the troubled nature of India's corresponding relationships. In addition, there is the entire gamut of issues arising from China's strategic objectives vis-à-vis the Indian Ocean, which raise the stakes of its relations with the littoral states. Geo-strategically, it seems incumbent upon India to play a major role within a cooperative, multilateral structure in the formulation of a regional framework of relationships.

Against this backdrop, dragging China into the quagmire of a tension-ridden SAARC – such as according it observer status in November 2005 – is not the best way to sort out problems internal to the Southasian region. India must set about putting the Southasian house in order by improving its relations within the region, and cooperative security must be firmly established as the sine qua non of further progress. By substantially reconfiguring its foreign policy and addressing the concerns of its smaller neighbours, New Delhi can restrain or curb the tendency of the smaller states to pull China deeper into the Subcontinent's own strategic equations.

The China-Southasia matrix is at an unprecedented juncture. China's political and economic presence in the region is bound to intensify. What is needed now is for that interaction to increase at a people-to-people level. If India and its neighbours want to gain from the newfound amity between the two giants, they must start working towards a more effective regional framework between themselves in Southasia. The engagement between an ascendant China and a Southasia that acts regionally has the potential to transform the lives of more than two billion people.