India–China Relations

India–China Relations

• India and China are two of the world’s oldest civilisations with centuries-old cultural, religious, intellectual and commercial contacts.
• Ancient interactions were strengthened through Buddhism, the Silk Routes, trade and scholarly exchanges.
• Chinese pilgrims such as Faxian, Xuanzang and Yijing (I-Tsing) travelled to India and played an important role in civilisational exchanges.
• In the modern period:
  • India became independent in 1947.
  • The People’s Republic of China (PRC) was established in 1949.
  • India established diplomatic relations with the PRC on 1 April 1950.
• India-China relations have moved through several phases:
  • 1950s: Cooperation and “Hindi-Chini Bhai-Bhai”
  • 1962: Border war
  • 1970s: Strategic distance
  • 1988 onwards: Gradual normalisation
  • 2000s–2010s: Growing economic engagement alongside strategic competition
  • 2020 onwards: Severe deterioration following the Eastern Ladakh crisis and Galwan Valley clash
  • 2024 onwards: Gradual diplomatic stabilisation following the disengagement agreement in eastern Ladakh.
• Despite bilateral tensions, both countries continue to interact through BRICS, SCO, G20 and other multilateral platforms.

India–China Relations: Important Timeline

Panchsheel Principles

Five Principles of Peaceful Coexistence

• The Panchsheel Principles were formally incorporated into the 1954 India-China agreement.
• They include:
  1. Mutual respect for territorial integrity and sovereignty
  2. Mutual non-aggression
  3. Mutual non-interference in internal affairs
  4. Equality and mutual benefit
  5. Peaceful coexistence

Areas of Cooperation between India and China

Political and Diplomatic Cooperation

• Despite serious differences, India and China maintain multiple diplomatic mechanisms.
• Important mechanisms include:
  • Special Representatives’ Dialogue on the Boundary Question
  • Working Mechanism for Consultation and Coordination (WMCC) on border affairs
  • Corps Commander-level military talks
  • Foreign Minister-level dialogue.
• Rajiv Gandhi’s 1988 visit marked a major turning point by allowing broader bilateral relations to develop while negotiations on the boundary continued.
• The Special Representatives mechanism, established in 2003, remains an important mechanism for addressing the boundary question.
• Following the 2024 disengagement arrangements, diplomatic engagement intensified to stabilise bilateral relations.

Economic Relations

• Economic ties present a major paradox: strategic rivalry coexists with deep economic interdependence.
• China remains one of India’s largest merchandise trading partners and its largest source of merchandise imports.
• India’s imports from China are concentrated in:
  • Electronics
  • Electrical machinery
  • Telecom equipment/components
  • Machinery
  • Chemicals
  • Pharmaceutical intermediates
  • Solar-related equipment/components.
• India’s exports include:
  • Iron ore and other mineral products
  • Organic chemicals
  • Cotton and other commodities
  • Engineering and selected manufactured products.
• A major concern is India’s very large merchandise trade deficit with China, which has crossed the US$100-billion level on recent annual trade measures.
• Therefore, the policy challenge is increasingly:

Economic engagement + diversification + reduction of critical dependencies

Strategic Economic Dependencies

• India remains dependent on Chinese supply chains in sectors such as:
  • Active Pharmaceutical Ingredients (APIs)
  • Electronics
  • Solar photovoltaic components
  • Industrial machinery
  • Telecom components
  • Critical minerals and processing.
• India is attempting to reduce vulnerabilities through:
  • Production Linked Incentive (PLI) schemes
  • Semiconductor Mission
  • Domestic electronics manufacturing
  • Pharmaceutical manufacturing
  • Critical mineral partnerships
  • Supply-chain diversification.

Investment Relations

• Following the 2020 border crisis, India strengthened scrutiny of investments originating from countries sharing a land border with India through Press Note 3 (2020).
• Consequently, Chinese investment faces greater government screening, especially in strategic and technology-sensitive sectors.

Science and Technology

• India-China technological relations combine competition, dependence and limited cooperation.
• Areas where both countries possess major capabilities include:
  • Artificial Intelligence
  • Space technology
  • Renewable energy
  • Biotechnology
  • Digital technologies
  • Earth sciences.
• China has significantly larger manufacturing ecosystems in:
  • Solar equipment
  • Batteries
  • Electronics
  • Critical-mineral processing.
• India is trying to develop domestic alternatives through:
  • India Semiconductor Mission
  • National Green Hydrogen Mission
  • PLI schemes
  • Critical-mineral partnerships.
• Scientific cooperation is increasingly affected by national-security concerns and strategic competition.

Culture and People-to-People Relations

  Historical Cultural Links

• • Buddhism represents one of the strongest civilisational bridges between India and China.
  • Indian Buddhist monks and scholars travelled to China, while Chinese pilgrims such as Faxian and Xuanzang travelled to India.
  • Other cultural connections include:
    • Yoga
    • Traditional medicine
    • Education
    • Art
    • Historical trade routes.

  Kailash Mansarovar Yatra

• • Kailash Mansarovar has major religious importance for Indians.
  • The pilgrimage had remained suspended for several years following the pandemic and deterioration in bilateral relations.
  • As relations began stabilising, India and China agreed to resume the Kailash Mansarovar Yatra in 2025.
  • Its restoration became an important indicator of improving people-to-people exchanges.

Education and Tourism

• Before the pandemic, China had become an important destination for Indian medical students.
• Educational exchanges were disrupted by:
  • COVID-19
  • Visa restrictions
  • Border tensions.
• Restoration of:
  • Direct flights
  • Visas
  • Tourism
  • Academic exchanges
    remains important for normalising bilateral relations.

Multilateral Cooperation

BRICS

• India and China are major members of BRICS, which has now expanded well beyond its original five-member composition.
• BRICS provides a platform for cooperation on:
  • Global governance reforms
  • Development finance
  • Climate change
  • Global South issues
  • Multilateralism.
• Important institutions include:
  • New Development Bank (NDB)
  • Contingent Reserve Arrangement (CRA).
• India assumed the BRICS Chairship for 2026, creating another important platform for engagement with China.

Shanghai Cooperation Organisation (SCO)

• India became a full member of the SCO in 2017.
• Both countries cooperate within the organisation on:
  • Counter-terrorism
  • Regional security
  • Connectivity discussions
  • Economic cooperation
  • Central Asian stability.
• The SCO provides India and China with an additional diplomatic platform even during periods of bilateral tension.

Russia–India–China (RIC)

• RIC brings together Russia, India and China.
• Potential areas of cooperation include:
  • Multilateralism
  • Global governance reform
  • Counter-terrorism
  • Regional stability.
• However, the mechanism has remained largely dormant at the leaders/foreign-minister trilateral level in recent years, particularly after the India-China border crisis.

Asian Infrastructure Investment Bank (AIIB)

• AIIB is headquartered in Beijing.
• China is its largest shareholder, while India is the second-largest shareholder.
• India has been one of the largest recipients of AIIB financing.
• Projects cover:
  • Transport
  • Energy
  • Urban infrastructure
  • Water
  • Sustainable development.

World Trade Organization

• India and China sometimes share interests in the WTO as major developing economies.
• Common concerns include:
  • Agricultural subsidies in developed countries
  • Development rights
  • Reform of global economic institutions.
• However, they also compete strongly in manufacturing and international trade.

Climate Negotiations

• India and China cooperate through the BASIC grouping:
  • Brazil
  • South Africa
  • India
  • China.
• BASIC has traditionally emphasised:
  • Climate justice
  • Equity
  • Common but Differentiated Responsibilities and Respective Capabilities (CBDR-RC)
  • Greater climate finance from developed countries.

Significance of China for India

Economic Importance

• China is important because it is:
  • A major trading partner
  • A major source of industrial inputs
  • A dominant player in global manufacturing.
• Stable economic relations can support:
  • Supply chains
  • Manufacturing
  • Pharmaceuticals
  • Renewable-energy transition.

Global Governance

• India and China together possess considerable influence in:
  • BRICS
  • G20
  • SCO
  • WTO
  • Climate negotiations.
• Cooperation can strengthen the representation of developing countries and the Global South.

Regional Stability

• India and China are both nuclear-armed Asian powers.
• Stable bilateral relations reduce:
  • Military escalation
  • Regional instability
  • Economic uncertainty.

Significance of India for China

• India offers China:
  • One of the world’s largest consumer markets
  • Major trade opportunities
  • Influence within the Global South
  • Cooperation in multilateral institutions.
• India is also a major geopolitical actor in the:
  • Indian Ocean
  • South Asia
  • Indo-Pacific.
• Stable relations with India can reduce China’s strategic pressure along its southwestern frontier.
• Cooperation with India can also strengthen China’s position on selected issues involving:
  • Multilateralism
  • Climate change
  • Global economic governance.

Major Challenges in India–China Relations

Boundary Dispute

• The unresolved boundary question remains the most serious bilateral dispute.
• India and China do not share a mutually agreed and fully delineated international boundary.
• The Line of Actual Control (LAC) is not mutually clarified along its entire length.
• India commonly cites the India-China boundary as approximately 3,488 km, while Chinese official calculations differ.

Western Sector

• Located primarily in Ladakh.
• The principal dispute concerns Aksai Chin.
• India considers Aksai Chin part of Ladakh, while it is under Chinese control.
• China considers the region strategically important because of the road connection between Xinjiang and Tibet.

Middle Sector

• Covers areas adjoining:
  • Himachal Pradesh
  • Uttarakhand.
• It contains fewer and comparatively smaller disputes than the western and eastern sectors.

Eastern Sector

• Primarily involves Arunachal Pradesh.
• India recognises the McMahon Line as the boundary.
• China disputes the McMahon Line and claims large parts of Arunachal Pradesh, especially Tawang, referring to much of the state as “South Tibet”.
• India firmly rejects these claims and regards Arunachal Pradesh as an integral and inalienable part of India.

Why the LAC Remains Problematic

• Both countries have different perceptions of where the LAC lies in several areas.
• This can produce:
  • Patrol face-offs
  • Transgressions
  • Military deployments
  • Infrastructure competition.
• Therefore, clarification and stabilisation of the LAC remains essential.

Galwan Valley Clash and Eastern Ladakh Crisis

• In June 2020, Indian and Chinese troops clashed violently in the Galwan Valley.
• 20 Indian soldiers were killed; China later officially acknowledged four military deaths.
• It was the deadliest India-China border confrontation in decades.
• The crisis led to:
  • Massive military deployment
  • Diplomatic deterioration
  • Restrictions on Chinese apps
  • Greater scrutiny of Chinese investments
  • Acceleration of Indian border infrastructure.
• India subsequently maintained that peace and tranquillity at the border are essential for normal bilateral relations.

  Disengagement and the 2024 Thaw

• • Several friction points saw phased disengagement after multiple rounds of:
    • Military talks
    • WMCC meetings
    • Diplomatic negotiations.
  • In October 2024, India announced an agreement regarding patrolling arrangements in Depsang and Demchok.
  • Subsequent disengagement helped create conditions for renewed high-level political engagement.
  • However, disengagement does not mean that the overall boundary dispute has been settled.

Tibet and Dalai Lama

• Tibet remains a sensitive element of India-China relations.
• The 14th Dalai Lama fled Tibet in 1959 and received asylum in India.
• The Central Tibetan Administration operates from Dharamshala.
• China remains sensitive to:
  • Dalai Lama’s political activities
  • Tibetan exile community
  • His visits to Arunachal Pradesh.
• A future Dalai Lama succession question could become another sensitive geopolitical issue.

Brahmaputra and Transboundary Water Issues

• The Brahmaputra is known as:
  • Yarlung Tsangpo in Tibet
  • Siang/Dihang in Arunachal Pradesh
  • Brahmaputra in Assam.
• China is the upper-riparian state, while India and Bangladesh are downstream countries.
• Major Indian concerns include:
  • Chinese hydropower projects
  • Availability of hydrological data
  • Ecological impact
  • Downstream flows
  • Possible cumulative impact of dams.
• There is no comprehensive India-China water-sharing treaty for the Brahmaputra.
• China’s plans for a very large hydropower project on the lower reaches of the Yarlung Tsangpo have further increased Indian strategic and environmental concerns.

China–Pakistan Nexus

• China’s close strategic relationship with Pakistan is a major Indian concern.

  China-Pakistan Economic Corridor

• • CPEC is a flagship component of China’s Belt and Road Initiative (BRI).
  • India opposes CPEC because portions pass through Pakistan-occupied Kashmir, territory claimed by India.
  • India views this as a violation of its sovereignty and territorial integrity.

  Defence Cooperation

• • China has helped Pakistan develop capabilities involving:
    • Conventional weapons
    • Missiles
    • Aircraft
    • Naval platforms.
  • Growing China-Pakistan military cooperation creates a potential two-front security challenge for India.

  Masood Azhar – Updated Position

• • The older claim that China continues to block the designation of Masood Azhar is obsolete.
  • After earlier placing technical holds, China withdrew its objection in 2019.
  • The UN Security Council’s 1267 Sanctions Committee designated Masood Azhar a global terrorist in May 2019.

Belt and Road Initiative

• China’s Belt and Road Initiative (BRI) seeks to develop infrastructure and connectivity across:
  • Asia
  • Europe
  • Africa
  • Maritime regions.
• India has not joined BRI.

  Reasons for India’s Opposition

• • CPEC passes through Pakistan-occupied Kashmir.
  • Concerns regarding:
    • Sovereignty
    • Transparency
    • Financial sustainability
    • Environmental standards
    • Local participation
    • Strategic implications.
  • India instead supports connectivity based on:
    • Sovereignty
    • Territorial integrity
    • Financial responsibility
    • Transparency
    • Environmental sustainability.

China’s Presence in the Indian Ocean Region

• China’s growing Indian Ocean presence is an important strategic concern for India.
• Major Chinese-linked locations include:
  • Djibouti military support base
  • Gwadar Port – Pakistan
  • Hambantota Port – Sri Lanka
  • Kyaukpyu – Myanmar.
• China also maintains substantial naval deployments in the Indian Ocean for:
  • Anti-piracy
  • Sea-lane protection
  • Overseas interests.

Beyond the “String of Pearls”

• “String of Pearls” is an analytical term, not an officially declared Chinese strategy.
• Contemporary analysis is better framed around:
  • Dual-use infrastructure
  • Port access
  • PLA Navy deployments
  • Maritime logistics
  • BRI connectivity
  • China’s growing blue-water naval capability.

Doklam Standoff

• Doklam is a disputed area between Bhutan and China, close to the India-Bhutan-China tri-junction.
• In 2017, Chinese road construction triggered a prolonged India-China military standoff.
• India intervened because changes in the area could have strategic implications for:
  • Bhutan
  • India-China tri-junction
  • Siliguri Corridor.

Strategic Importance

• The Siliguri Corridor, or “Chicken’s Neck”, connects mainland India with the North-Eastern states.
• Chinese strategic gains near the corridor could increase India’s vulnerability.
• Doklam therefore demonstrates the interconnection between:
  • India-China relations
  • Bhutan-China boundary negotiations
  • India’s Northeast security.

India, China and the Indo-Pacific

Quad

• The Quadrilateral Security Dialogue (Quad) comprises:
  • India
  • United States
  • Japan
  • Australia.
• It focuses on areas including:
  • Maritime security
  • Critical technologies
  • Supply-chain resilience
  • Cybersecurity
  • Disaster relief
  • Infrastructure.
• China remains suspicious of the Quad and views it through the prism of strategic competition.

Malabar Exercise

• The Malabar naval exercise involves India, the US, Japan and Australia.
• It strengthens:
  • Maritime interoperability
  • Naval cooperation
  • Indo-Pacific security capabilities.

South China Sea

• India supports:
  • Freedom of navigation
  • Freedom of overflight
  • Unimpeded lawful commerce
  • Peaceful settlement of disputes
  • Respect for international law, particularly UNCLOS.
• India has significant economic and strategic interests in maintaining open sea lanes connecting the Indian and Pacific Oceans.

Economic Challenges

Trade Deficit

• India’s large trade deficit with China is a major structural concern.
• The deficit reflects India’s dependence on Chinese:
  • Electronics
  • Machinery
  • Chemicals
  • APIs
  • Renewable-energy equipment.

Market Access

• Indian companies continue to face difficulties in accessing Chinese markets, particularly in:
  • Pharmaceuticals
  • IT and digital services
  • Selected agricultural and manufactured products.

Dumping and Trade Remedies

• India has frequently used:
  • Anti-dumping duties
  • Safeguard measures
  • Quality-control measures
    against imports considered harmful to domestic industry.

Cybersecurity

• Cybersecurity has emerged as a major area of strategic concern involving:
  • Critical infrastructure
  • Telecommunications
  • Government networks
  • Data security.
• Consequently, economic engagement increasingly intersects with national-security policy.

International Institutional Differences

Nuclear Suppliers Group

• China has not supported India’s entry into the Nuclear Suppliers Group (NSG) under India’s preferred terms.
• Beijing argues that membership criteria should apply uniformly to non-NPT states.
• India seeks membership based on its:
  • Non-proliferation record
  • Nuclear export controls
  • 2008 NSG waiver.

UN Security Council Reform

• India seeks permanent membership of an expanded UNSC.
• China has not explicitly endorsed India’s candidature for a permanent seat.
• This remains an important difference in approaches to global governance reform.

India–China Strategic Competition

• India-China relations cannot be described simply as either cooperation or confrontation.
• They involve simultaneous: Competition + Cooperation + Deterrence + Economic Interdependence

Areas of Competition

• South Asia
• Indian Ocean Region
• Southeast Asia
• Africa
• Global South leadership
• Manufacturing
• Technology
• Critical minerals
• Infrastructure connectivity
• Global institutions.

India’s Strategic Responses

• India is strengthening:
  • Quad
  • Indo-Pacific partnerships
  • Act East Policy
  • Relations with ASEAN
  • Indian Ocean partnerships
  • Border infrastructure
  • Domestic manufacturing
  • Supply-chain resilience.
• India also seeks alternatives to BRI through projects and frameworks such as:
  • International North-South Transport Corridor (INSTC)
  • Chabahar Port
  • India-Middle East-Europe Economic Corridor (IMEC)
  • Indo-Pacific connectivity initiatives.

Key Contemporary Paradox in India–China Relations

• The relationship contains three simultaneous realities:
  • At the Border → Strategic Rivalry
  • In Trade → Deep Interdependence
  • In Multilateral Forums → Selective Cooperation
• This explains why India neither seeks complete economic decoupling nor accepts a return to normal relations without addressing border peace and security.

Way Forward

Maintain Peace along the LAC

• Border peace must remain the foundation of the bilateral relationship.
• Both sides should:
  • Avoid unilateral alteration of the status quo
  • Continue military and diplomatic dialogue
  • Strengthen crisis-management mechanisms
  • Clarify disputed perceptions wherever possible.

Boundary Settlement

• India and China should intensify negotiations through the Special Representatives mechanism.
• A durable settlement would dramatically reduce strategic uncertainty.

Rebuild Mutual Trust

• The post-2020 trust deficit requires:
  • Transparency
  • Predictable behaviour
  • Respect for existing agreements
  • Regular political dialogue.

Reduce Critical Economic Dependencies

• India should pursue de-risking rather than indiscriminate decoupling.
• Priority sectors include:
  • APIs
  • Electronics
  • Semiconductors
  • Solar equipment
  • Batteries
  • Critical minerals.

Correct the Trade Imbalance

• India should seek greater Chinese market access for:
  • Pharmaceuticals
  • IT services
  • Agricultural products
  • Engineering goods.
• Simultaneously, domestic manufacturing capabilities should be strengthened.

Strengthen Transboundary Water Cooperation

• India and China should improve:
  • Hydrological data sharing
  • Flood forecasting
  • Scientific exchanges
  • Transparency regarding major upstream projects.

Restore People-to-People Relations

• Normalisation should include:
  • Direct flights
  • Tourism
  • Student exchanges
  • Academic cooperation
  • Kailash Mansarovar Yatra
  • Cultural exchanges.

Expand Selective Multilateral Cooperation

• Both countries can cooperate through:
  • BRICS
  • SCO
  • G20
  • WTO
  • Climate negotiations
    on issues where interests converge.

Maintain Strategic Autonomy

• India should deepen partnerships with the US, Japan, Australia, Europe, ASEAN and other powers without reducing its China policy to alliance politics.
• The objective should remain strategic autonomy combined with credible deterrence.

Conclusion

• Managing China remains one of the most complex challenges of Indian foreign policy.
• Geography ensures that India and China cannot avoid each other, while their growing capabilities make both partners, competitors and strategic rivals simultaneously.
• The post-2020 experience has demonstrated that peace and tranquillity along the border cannot be separated from the broader bilateral relationship.
• India’s long-term approach should therefore combine:

“Engagement where possible, competition where necessary, deterrence where required, and cooperation where interests converge.”

• A stable, predictable and mutually respectful India-China relationship would benefit not only the two countries but also the wider Asian and global order.