Prior to 2002, India and China competed aggressively with each other to acquire oil and gas fields abroad. Wisdom dawned, however, with improved energy cooperation starting that year, when India’s Oil and Natural Gas Corporation (ONGC) purchased a 25 per cent share of Sudan’s Greater Nile Oil Project, operated by the China National Petroleum Corporation (CNPC). The experience has been positive and continued cooperation in the global energy sector, including some examples of joint bids and at least one successful joint acquisition, has occurred. The prospects for further collaboration, to jointly explore and develop oil and natural gas resources in third countries, are high.
To take another example: our demand for food will inevitably rise as well, perhaps by 50 per cent in the next two decades, as a result of our growing population, their rising affluence and the improved dietary possibilities available to a larger middle class. We will need to multiply our sources of food, including acquiring agricultural land abroad, in Africa and even Latin America. Lack of access to stable supplies of water is reaching critical proportions, particularly for agricultural purposes, and the problem will worsen because of rapid urbanization over the next twenty years. We will need skilful and creative diplomacy to ensure that interruptions in the flow of water across our borders do not bedevil relations with our neighbours.
The only question is whether the two countries can prolong the elephant — dragon dance, or whether political tensions could bring the music to a screeching halt. Critics argue that the good news is in fact good only for China. The trade surplus is undoubtedly in favour of Beijing: of the $73 billion in 2011, $50 billion consisted of Chinese exports to India and only less than half of that, $23 billion, of Indian exports to China. China conserves it own domestic resources of iron ore by importing this commodity from India and selling finished steel to it. Indeed, some critics have argued that India is largely exporting its primary commodities to China and importing finished products from that country, a pattern of trade relations reminiscent of the exploitation of India’s raw materials in the colonial era. A large proportion of Chinese exports involves items that are so much cheaper than Indian alternatives that they are making Indian manufacturing unviable. And the focus on trade, critics suggest, underscores an issue of interest to Beijing, while taking attention away from the broader strategic contest between the two countries, which China’s economic interests prompt it to gloss over.
The critics may be right in suggesting that good trade relations do little to help resolve the perennial political problems between countries. But there are two counter-arguments worth making. First, trade contributes to a positive atmosphere between two countries, which at least makes political hostility less likely. More important, in this instance, it ensures that China has far too high a stake in the Indian economy to contemplate engaging in any military adventurism against India. There are some strategic advantages to offering a potential adversary a large market: it is more likely that the Chinese establishment will learn to see Indians as consumers rather than as enemies.
This raises the issue of the risk of conflict between the two countries. As all Indians painfully remember, we went to war in 1962—a decisive triumph for China, which wrested 23,200 square kilometres of Indian territory. At the same time, Beijing has taken pains in recent years to remind India that it still claims a further 92,000 square kilometres, mainly in the north-eastern Indian state of Arunachal Pradesh. It doesn’t help that the two countries share the longest disputed frontier in the world, since the Line of Actual Control (LAC) has never been formally delineated in a manner accepted by both sides. India’s borders were defined by British imperial administrators in the 1913 MacMahon Line, which China rejects (though it accepts that line as its frontier with Myanmar, which was in those days part of British India). With the LAC coming into being in the wake of China’s military success in 1962, the situation is even more unclear. Whenever troops from either side build roads, construct or repair their bunkers and other routine fortifications, or conduct patrols close to the LAC, tensions can and repeatedly do flare up. When the two sides are anxious to avoid provoking each other, such activities are kept to a minimum, but it seemed that since 2008 Beijing has taken a conscious decision to keep the Indians on their toes.
Why do I say that? The last three years have witnessed a proliferation of incidents along the 3488-kilometre frontier between the two Asian giants. Nearly 200 have been recorded, including no fewer than ninety-five incursions by the People’s Liberation Army in just one sector alone — the evocatively named Finger Area, a 2.1-square-kilometre salient in the Indian state of Sikkim, which shares a 206-kilometre border with Tibet. Intensified Chinese patrolling has been observed both in Ladakh and in the border areas of Arunachal Pradesh. Reports of intrusions into Indian territory included one in which Chinese soldiers entered 15 kilometres into Indian territory in Ladakh and actually burned the Indian patrolling base. While Indian spokespersons are anxious to downplay such reports, and fewer incidents were made public in 2011, they serve to remind us that the border dispute remains unresolved. In a reply to a question in Parliament, Defence Minister A.K. Antony informed MPs in December 2011 that Chinese troops had, in July 2011, damaged a 200-foot (approx. 60-metre) stone wall which was built 250 metres inside Indian territory in the Tawang area of Arunachal Pradesh. Antony said that an attempt by the Chinese People’s Liberation Army (PLA) to raze the wall was prevented by the Indian Army. The stone wall was partially damaged by the PLA patrol, but it has been reconstructed, he added.
Arunachal Pradesh has become a rhetorical flashpoint. Chinese notables, including their ambassadors in New Delhi, have publicly laid claim to the state in recent years, describing it as ‘Southern Tibet’ and publicly objecting whenever an Indian leader (or the Dalai Lama) travelled there. (To India’s credit, this has not deterred Prime Minister Manmohan Singh from visiting and campaigning in Arunachal’s elections, nor did India prevent the Dalai Lama from ministering to his flock in that state.) China also reacted sharply to the participation by India’s Defence Minister Antony in the silver jubilee celebrations of the state of Arunachal Pradesh held on 20 February 2012, with a Chinese foreign ministry spokesperson asking India publicly to refrain from any action that will complicate the border issue. Earlier China had denied a visa to an Indian Air Force official born in Pasighat, Arunachal Pradesh, who was supposed to visit China as part of an Indian tri-services delegation, on the grounds that as an Arunachali he was not entitled to an Indian passport or a Chinese visa! But the quantum of belligerence in the official Chinese media’s reporting about India has risen alarmingly; there have been reminders of 1962 and the People’s Daily has gone so far as to write of India’s ‘recklessness and arrogance’ and urging it to consider ‘the consequences of a potential confrontation with China’.