- An Autonomous Think-Tank of Defence and Security Studies 

Prof. Ghosh, distinguished scholars and academics, faculty members, students, esteemed guests, friends, ladies and gentlemen,

It gives me great pleasure to speak on the very important subject of India-China Relations to this knowledgeable and erudite audience.

Before covering the current contours of India's relations with China, let me emphasize that India’s approach to planning and articulating its foreign policy has been constant since independence; for us foreign policy is an enabler in the transformation of India. India is increasingly getting integrated into and interdependent with the globalized world. Events worldwide affect our future. We need a peaceful periphery; and a global environment which fosters constructive dialogue and cooperation around the world. In areas of tension we support the development of a suitable architecture for discussion and the maintenance of stability. We are aware that almost half our GDP is linked to foreign trade; up from about 20% in the 1990s; foreign investment and technology continue to be significant inputs for our growth. We are a country poorly endowed with natural resources relative to our share of the world’s population. We depend on energy and critical raw materials from abroad. Global communications, models and best practices influence the thinking of our people. How the world grows and develops and how our foreign policy navigates the shoals ahead and finds the appropriate channels for safe and rapid travel is therefore a matter of vital importance for India.

Coming to our relations with China, it is a well known axiom that large countries are never at peace or at ease with their neighbors. India is no exception. This is all the more the case when our neighbor to the North is the most populous state in the world and also the fastest growing economy in recent memory or history.

China's growth over the last 3 decades in political, military and economic spheres has been quite remarkable. In the 1970s before it embarked on its modernization programme and started opening up to the world economy, its per capita and overall GDP was less than India's. Today its total GDP is about four times that of India at around USD 7.8 trillion while that of India is around USD 1.8 trillion. The foreign exchange reserves of China are around USD 3.4 trillion while those of India are a shade less than USD 300 billion. China has been growing uniformly at double digit figures for the last 30 years or so except for the last few years since the onset of the international economic crisis and even during this period, its GDP growth has been a healthy 7-8%. India was able to register growth rates of 9-10% only for 4 years between 2004 and 2008. Since then our growth rates have floundered and declined to a level of 5.5% in 2012-13.  . Many more statistics regarding social indicators including education, health-care, child birth mortality, infrastructure, savings rate etc can be cited, all of which go to prove that India is several years behind China. I must however hasten to add that fundamentals of the Indian economy continue to be strong and with the recent introduction of several major and far-reaching reforms and improvement of governance, Indian economy can once again start registering high and impressive growth rates

The significant power gap between India and China could further increase over the coming decades.  The challenge for India is how to manage this essentially competitive, if not totally adversarial, relationship in a manner that avoids overt hostility and armed conflict and yet provides us with the means of safeguarding our vital interests against encroachment by China.

China's impressive rise has become all the more pronounced over the last few years on account of the onset of the international economic crisis followed by the euro zone sovereign-debt crisis. The simultaneous, rapid decline of the Western economies including USA, Europe and Japan is shifting the centre of gravity irreversibly from the Western hemisphere to Asia which has compelled analysts and scholars bill the 21st century as the Asian Century.  China's remarkable growth is reflected in it becoming more assertive to protect and promote its core interests all over the world, particularly in its own neighborhood.

China's aggressive attitude has become more evident and visible over the last few years particularly after the successful hosting of the 2008 Olympic Games in Beijing.

Two factors are unique to the India China equation: first, India is the only Asian country which can stand in the way of China’s domination of Asia due to its size, population, and diplomatic, economic and military potential. Secondly, China’s march to superpower status continues to impinge directly on many elements of India’s national security matrix as well as on India’s vital national interests on a bilateral, regional, continental and global basis. In that sense China represents a greater challenge for India than for any other country.

China’s emergence as one of the pre-eminent powers in the international system has immense consequences for India because of a host of factors Some of these are:: geographical proximity; historical memories; the unresolved border dispute; the presence of Dalai Lama in India; the  Tibet question; Chinese military modernization; uncertainties regarding Chinese intentions; its relations with India’s neighbors, especially Pakistan;  the potential expansion of China’s maritime power into the Indian Ocean; growing economic inter-dependence between the two countries; and the potential for resource competition in West Asia, Latin America and Africa. I will briefly deal with some of these aspects in my Address.

On the border issue it needs to be recognized that the 4,000 km long border has been peaceful and tranquil over the last several years. A mechanism involving Special Representatives was established in 2003 to deal with this issue. Much progress has been made. 15 rounds of talks have been held so far. Last year a Working Group on Boundary Management was also established with the mandate to promote exchange of information and ensure that calm and quiet prevails on the border. Two meetings of this Working Group have already taken place. It however needs to be recognized that China has often been changing its position over the years on settlement of the border dispute. There was a suggestion from the Chinese side to settle the issue in the early 1980s on the basis of a ''package proposal''. However this stand was altered in the late eighties to demand major concessions from India in the eastern sector by surrender of Tawang in lieu of unspecified concessions by China in the western sector. This position was again altered in 2005 when China observed that India's political and diplomatic space was expanding on account of its growing relations with USA and EU  That is when the ''Agreement on the Political Parameters and Guiding Principles for the Settlement of the Boundary Question" was signed during the visit of PM Wen Jiabao in 2005. It was agreed that the final resolution would be a political decision and will not flow out of technical discussions.  There was hope that the boundary issue will be resolved by India giving up its claim on Aksai Chin and China agreeing to recognize the Mc Mohan line as it had recognized the boundaries drawn by the British with Myanmar (Burma) and Afghanistan. These hopes did not materialize. Wen Jiabao during his visit in 2010 said that it will take many years for the dispute to get resolved. Recently a statement emanating from a senior Chinese source stated that the ''mere presence'' of ''large populated areas'' would not be reason enough for China to give up its claim on Tawang and on Arunachal Pradesh which it considers as a part of South Tibet. China has also been making aggressive and hostile statements and issuing warnings on visits of Indian leaders to Arunachal Pradesh including during the visit of PM in Oct 2009 and of Defence Minister AK Antony to Tawang in Feb 2012. China occupies 38,000 sq kms of Indian territory in the west and claims 90,000 sq kms including the whole of Arunachal Pradesh in the East.. China has already settled its boundary with 12 of its neighboring states but is dragging its feet in resolving the border dispute to keep India under pressure so that it could use the issue to its advantage whenever the situation demands.

Tibet is another issue that is a significant source of friction between the two countries. Relations between India and China took a nose-dive with the flight of His Holiness Dalai Lama (HHDL)  to India in 1959.Through the Trade Agreement in 1954, India conceded all trading rights over Tibet to China and acknowledged it as an Autonomous Region of China. For the first time in history China and India share a common border and Tibet is not a buffer zone between the two countries.. Since the fifties, both China and India have dealt with the Tibet issue in a rather formulaic manner and have never really engaged in a frank and candid discourse over it. India’s position is (i) that Tibet is an autonomous region of China; (ii) that HHDL is a revered religious personage and an honoured guest in India; (iii) that India does not permit HHDL or the Tibetan community in India to engage in political activities hostile to China.

China has responded with its own standard pronouncements: (i) that Tibet is an integral part of China and has been historically; (ii) HHDL is engaged in activities to split China and seeks independence for Tibet; (iii) that India’s failure to prevent such activities is having a negative impact on friendly relations between India and China. There is a growing militancy among Tibetan youth both in India and in the Tibetan areas of China.

Our position on Tibet is however treated suspiciously and with mistrust by the Chinese. China is under considerable international pressure on this issue today on account of the unabated spate of immolations by Tibetan youth and monks to protest against the atrocities and oppression by Chinese authorities. Recently the number of immolations crossed the 100 mark and it does not appear as if it is going to stop anytime soon. The forcible settlement of Chinese Han population in this Region is altering the demographic profile of the Region and putting the preservation and continuation of Tibetan culture, language and way of life in jeopardy. China terms HHDL as a splittist and a liar. During every high level visit China has been demanding and India, like most other countries, has been acquiescing in mentioning that Tibet is an autonomous region of China..  We have not been able to capitalize upon these concessions given unilaterally by us to China and extract some viable trade-offs in areas of concern and interest to us. It is however to be noted that neither Tibet nor the One China Policy was mentioned in the Joint Communiqué that was issued during the visit of PM Wen Jiabao to India in Dec, 2010.

At another level, China has tried to encircle India and keep it boxed within the Region of South Asia. It has sought to build ports and bases in the periphery of India to keep India contained. The most recent case of takeover of Gwadar is another act in the same story. Some of the others are Marao in Maldives; Chittagong, Bangladesh;  Great Coco Island and Sittwe, Burma; Lamu, Kenya; and Hambantota in Sri Lanka. China has supplied nuclear technology and material as well as missile technology to Pakistan knowing full well that they will be used only against India. Its decision to supply two nuclear reactors without approval by IAEA is also in the same league. Pakistan's track record in clandestinely supplying and exporting nuclear technology and material is abysmal. It is not only the epicenter of terrorism but has also been called the ''Walmart'' of nuclear technology and material. Security of nuclear material and technology has become very uncertain and dangerous under these circumstances.

Some of the other unfriendly and provocative actions by China include issuance of visas to people of J&K on separate, stapled sheets; not issuing visas to people from Arunachal Pradesh; building huge dams on the Brahmaputra river thereby considerably reducing the flow of water to rivers as they flow through our territory; showing Arunachal Pradesh as a part of southern Tibet; unhelpful and unfriendly attitude during discussions in IAEA and NSG for the one time exception for nuclear commerce with India; its unsupportive attitude to India's aspirations to become Member of NSG, MTCR, Australia Group and Wassenaar Arrangement; its unhelpful and non supportive attitude towards India's Membership of UNSC; pressurising ADB to not approve funding for projects in Arunachal Pradesh; warning India that prior permission of China be obtained for Indian companies to start oil exploration operations in South China Sea; heavy militarization of its defense forces; improvement of infrastructure and stationing of large numbers of troops and armaments in the Tibet Region next to Indian border. This list can be expanded further.

Even though there are many and increasing asymmetries in the China – India equation, they do not necessarily stand in the way of friendly co-existence. China has many vulnerabilities. Going forward, these are likely to increase. On the other hand, India’s youth, demographic bulge and soft power attractions such as democracy and universal human freedoms for all its citizens, in addition to a robust and rapidly expanding economy will begin to count for even more in the coming years. India’s advantages are most tellingly reflected in the fact that India’s rise is universally welcomed and considered good for the world - major countries, the US and Japan in particular, and virtually all of China’s Southeast and East Asian neighbors have been enthusiastically reaching out to India. On the other hand, China’s rise has been arousing increasing apprehensions and anxieties.

How then do we deal with China's growing strength and assertive attitude on issues of core interest for India. First, we need to increase our own defensive capabilities particularly in the border areas..We need to improve our infrastructure, train our people well so that they are acclimatized to the inclement weather in inhospitable terrains, give them latest and sophisticated equipment. China like most countries respects strength and it needs to see that India is well prepared and strong to counter any challenge.

Secondly, it will be useful for decision and policy makers to consider the possibility of bringing the Tibet issue into play. It will be desirable and useful to have frank and direct conversations with China on this issue to develop a common understanding, not so much as to embarrass or exert pressure on them but to remove it as a factor of distrust and animosity between the two countries.

Thirdly, we need to consider whether we could apply pressure on China by enhancing our official and non-official contacts with Taiwan.  Taiwan has considerable investible resources as well as state of the art technologies in several significant areas..It would be beneficial, both as a pressure point against China and also in commercial and economic terms for us.

Fourthly, we need to strengthen our capacity and capabilities in the Indian Ocean region and not allow China to significantly enhance its presence there. For some years to come, China will be engaged with the South China Sea as well as the East China Sea on account of the outstanding problems that it faces with several neighbouring countries including Vietnam, Philippines, Japan and others. It will not be able to pay much attention to its fleet and operations in the Indian Ocean.

Next, as far as our border is concerned we need to consider whether we can effectively organise probes in areas where we enjoy a strong and superior position to counter incursions and provocations by China.

Last but not the least we need to establish strong and active relations with like minded countries like USA, Europe, Japan and Australia to put a psychological balancer in the minds of our adversaries. We also need to enhance our partnership with other countries in the Region like ASEAN members, our immediate neighbors, Central Asia and Russia.

The above having been said, it also needs to be realised that there are many areas in which the two countries are already cooperating and collaborating. The last few years have seen a rapid rise in our bilateral commercial and economic interaction as well as cooperation in several multilateral and international bodies. Our bilateral trade was USD 74 billion in 2011 although it saw a slight decline to USD 66 billion in 2012. The target is USD 100 billion by 2015 which, if the Euro zone crisis eases, should be well within our reach. Bilateral trade is however weighted heavily in China's favour. Our trade deficit with China was USD 29 billion in 2012. We need to impress upon China to open its markets to allow easier and smoother flow of Indian goods and services like pharmaceuticals, IT, food items, manufactured goods etc..Indian products have to contend with a number of non tariff barriers to gain entry into the Chinese market. China is also looking with interest at investment of USD 1.5 trillion that we are to make in development of our infrastructure sector during the Twelfth Plan. China is already active in this field particularly in the area of power generation and transmission, telecommunications etc. We however need to be circumspect about the sensitive nature of technologies being imported from China.

Our collaboration in shaping the existing global regimes is also significant. India and China have been collaborating fruitfully and actively on Climate Change, Multilateral Trade Negotiations including the Doha Round, G 20 and others. This cooperation needs to be continued and to be further expanded. The two countries have been meeting at high political levels frequently to exchange views and discuss outstanding issues so as to keep disagreements from spiralling out of control. PM Singh and PM Wen Jiabao met 14 times over the last 8 years. PM met with former President Hu Jintao equally often over this period. The two Foreign Ministers have also been meeting and exchanging views with each other on a regular and frequent basis. NSA has been meeting his counterpart Dai Bingguo also very often. This trend needs to continue and to be further strengthened and expanded. Voices and sounds emanating from Beijing are encouraging. The new leader of China Xi Jinping in his message to Dr Singh in Jan, 2013 expressed his strong desire to further strengthen friendly and warm relations between the two countries. While taking note of such sentiments and using all avenues to expand our ties we should not let our guard down and enter into a mood of complacency.

Neither of the two countries have the luxury to view each other in purely antagonistic terms. The profession of peaceful rise by China will be judged not by its verbal pronouncements but by its actions. And so far the pronouncements and threatening postures adopted by China are a source of immense distrust and nervousness amongst not only India but several of its neighbors and interlocutors.

Naturally, as between any two large countries, there are areas of convergence as well as fields of divergence between our nations. We need to continue to maintain dialogue with China with the objective of minimizing such differences and whenever possible, bridging them.

India is right in believing that cooperation and not confrontation is the right way forward. India is also quite right in making it clear that India will not be a party to any policy of containment of China. Indeed, in a statesmanlike and mature approach, the Indian leadership has consciously articulated the view that there is enough space for both India and China to grow and prosper and to fulfill and realize the aspirations and ambitions of their peoples.

To sum up, in the years ahead, the relationship will continue to be characterized by both competition and cooperation. Therefore, even as India continues to engage with China to promote better understanding on border management, trade, climate change, global governance and host of other issues of mutual interest, we should put in place a robust strategy to defend our territorial integrity and its interests in the region and the world. India is deeply concerned about China’s economic, military and cyber-war potential, and hopes China will gradually step into the role of a responsible stakeholder in world security.

We must never disregard the fact that China suffers many handicaps and disabilities that are sometimes concealed by its economic rise and ignored by its admirers. It has serious problems with ethnic minorities like the Uigurs and Tibetans. There are challenges of banks riddled with bad loans, finding employment and pensions for a large rapidly ageing workforce, adverse demographic composition on account of a shrinking labor force and fast graying population, social inequality of destabilizing proportions, among the highest in the world, and greater than even that in the USA. There is simmering dissent among its citizens and civil society. There is rampant corruption at all levels, and environmental degradation. Many of these issues found mention in the statements by the recently elected Chinese leadership after the 18th conclave of the Chinese Communist Party. The country has grown to an extraordinary extent over the past three decades, but it may be harder to sustain it and to achieve internal consensus on what comes next.

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Guest Lecture on “India - China Relations” by Ambassador Ashok Sajjanhar on March 20, 2013 at University of Calcutta, Kolkata, India

Amb. Ashok Sajjanhar has served as Ambassador of the Republic of India to Kazakhstan, Sweden and Latvia. He has also held several significant positions in Indian Embassies in Moscow, Teheran, Geneva, Dhaka, Bangkok, Washington and Brussels. He negotiated for India in the Uruguay Round of Multilateral Trade Negotiations. He has been an active participant in many International Seminars organised by UNCTAD and WTO. 

​​​Centre for Defence Sciences Research & Development