The first step to rebuild could be to expand people-to-people exchanges so as to enhance mutual understanding and address each other’s concerns.
On the sidelines of the BRICS summit in Kazan, Russia, capital of the Republic of Tatarstan, the biggest surprise was the meeting between Prime Minister of India, Narendra Modi and President of PRC, Xi Jinping that broke the ice of the difficult India-China relations, towards bringing it back on track. Since the border conflict in 2020, the bilateral relations had again fallen to the lowest point ever since the establishment of diplomatic ties between the two countries. During this period, the world is also experiencing an increasingly volatile geopolitical, economic situation and the strategists and academics in both countries had low expectations for a quick turnaround in bilateral relations. Therefore, the leaders’ meeting came as a surprise to both countries as well as to the rest of the world.
The political and diplomatic relations between the two sides had become quite tense after the Galwan skirmish in 2020. China had proposed that the two countries should keep the border issue on a separate page and progress the other bilateral issues such as trade cooperation and cultural exchanges whereas, India’s stand was that till the issue of friction points were resolved to maintain sustainable peace and tranquillity along the border, rest of the bilateral relations could not progress further. Before the Kazan BRICS summit, the two leaders had attended a number of multilateral fora, but not met individually.
Despite these difficulties in bilateral relations, both sides have made great efforts to stabilize the border situation and maintain a bottom line in bilateral relations. Even during the most difficult times, the two sides maintained diplomatic and military conversations and after many rounds of military negotiations, the last two disputed areas were properly resolved just before the Kazan Summit. From this perspective, the two leaders have demonstrated to the world their extraordinary political wisdom as was expected from these two great countries with ancient histories and civilizations. They were determined to set an example towards world peace and stability.
REASONS BEHIND THE THAW
It is worth taking a deep dive into the reasons that led to this thaw. There are many theories but essentially it is the outcome of all or a few of the following:
First, from an international perspective, the two leaders have shown great maturity and minute understanding of the geopolitical situation today and the manner in which world order is churning.
India and China, as the world’s economic and populous giants, are of vital importance to stabilizing the world order, leading to world peace and prosperity, and promoting global economic resurgence. The two countries are deeply aware that “cooperation brings mutual benefits, while confrontation brings mutual harm”. Cooperation would inject stabilization and positive energy into an increasingly unstable world, while confrontation will further tear apart the increasingly fragmented global community and lead to greater difficulties particularly to the developing countries. This aspect of geopolitics has been an important driver for change.
Second, after the outbreak of the Russia-Ukraine conflict in 2022, the financial sanctions imposed by the United States and the West on Russia have made countries such as India and China deeply aware of the possible damages caused by the dollar-dependent financial system. For an extended period, global economy’s significant reliance on the US dollar has facilitated dollar hegemony, enabling the US to impose economic sanctions on numerous countries worldwide with relative ease through this financial dominance. Considering that India and China, the two most populous major developing countries, shoulder the mission of domestic prosperity and also common expectations of other developing countries for their prosperity as well, the normalization of India-China bilateral relations has become essential. This could make things easier for the world.
Third, since 2020, geopolitical shocks, changes in economic policies of various countries, and the restructuring of international trade relations have profoundly affected the progress of the global economy. In the past four years or so, the global economy has shown unprecedented complexity, the economic cooperation patterns are gradually pointing towards a multi-polarized system. The competition and cooperation among countries are becoming increasingly sophisticated. Although the Indian economy has maintained a high growth rate, objectively speaking, there are obvious development imbalances. China’s economy has also stumbled during this period and is slowly recovering from a complex environment.
Since the outbreak of the Galwan skirmish, both sides have deployed large numbers of troops on the land border and have rapidly improved the infrastructure. These large quantities of arms, number of personnel have led to logistics challenges and undoubtedly increased the economic burden on both sides. This has hindered the balance of economic goals and of quality development. Under these circumstances, both sides have felt the need for an early and proper settlement of the border dispute, which definitely is a pragmatic choice.
Of course, there are other factors contributing to the need for improvement in bilateral relations. Among them, it is worth noting that despite the spillover impact of bilateral relations and many difficulties, the bilateral trade volume between two sides has remained at a high level over the past four years, which demonstrates the strong resilience and huge potential for economic growth. Moreover, the leadership on both sides showed remarkable political wisdom in keeping the windows for military and diplomatic dialogues open despite the challenges in bilateral relations. It was this kind of foresight and patience that accelerated the thaw in India-China relations.
HOWTO BUILD TRUST
China and India, two major developing countries with a population of more than 2.8 billion, are the engines of world economic growth. Under the current circumstances, their bilateral relations are of great significance both bilaterally, regionally and globally. At this juncture, President Xi and Prime Minister Modi have once again led the bilateral relations to a new chapter, but how it pans out in the future, will require more wisdom and patience. After all, the current reality is that the level of mutual trust is low, and all kinds of pessimistic voices about the bilateral relations are still raging. Both governments should make joint efforts to promote the level of bilateral cooperation step by step to build mutual trust and improve bilateral relations.
The first step could be to expand people-to-people exchanges so as to enhance mutual understanding and address each other’s concerns. Chinese embassies and consulates in India have issued about 24 lakh visas to Indian citizens since 2024, while it is reported that Indian embassies and consulates in China issued only a few thousand visas to Chinese citizens. The lifting of visa restrictions on China will help in academic exchanges, visits to religious spots, better monitoring of existing business enterprises, etc. By normalization of people-to-people relations and cultural exchanges, India and China could improve public opinion and lay the foundation for better India-China relations. On this basis, direct flights between China and India should be resumed as soon as possible.
Second, restart the India-China economic and trade dialogue mechanism to upgrade economic and trade cooperation for mutual benefits for win-win results. Both India and China have huge market potential and strong industrial complementarity. However, problems such as trade imbalance, trade barriers and discriminatory business environment have restricted further improvement of bilateral economic and trade cooperation over the past five years. Over the past few decades, China and India had established a series of cooperative mechanisms to promote economy and trade, such as the India-China Joint Group of Economy and Trade in 1988, the India-China Financial Dialogue in 2005, the India-China Strategic Economic Dialogue in 2010 etc. However, almost all of these mechanisms have stalled since 2019. Timely resumption of various economic and trade cooperation mechanisms will help strengthen policy communication and reduce obstacles to economic and trade cooperation.
Third, strengthening communication and cooperation in multilateral and global forums to safeguard the interests of developing countries. India and China should work together to promote the reform of the existing global governance system, which increases the participation of developing countries. Strengthen international cooperation in poverty alleviation, disaster reduction and mitigation, energy security, food security, low-carbon development and climate change impacts. Cooperation in emerging areas such as data security, bioengineering and artificial intelligence will promote the establishment of rules.
For India and China, the right time has arrived.
* Dr Xiao Jianmei, Associate Professor, China Center for South Asian Studies, Sichuan University, Chengdu.
Vice Admiral Shekhar Sinha (Retd), Chairman, Trustee Board, India Foundation, New Delhi.
The views expressed are personal and do not necessarily reflect organisational views.
A note from The Sunday Guardian: The views expressed in this article are solely the authors’.