Just a few months ago, the armed forces of India and Pakistan found themselves embroiled in a brief yet deadly conflict that had indirect implications involving a third nation – China. During this confrontation, Pakistan's military heavily relied on China-made equipment, which included advanced fighter jets and radar systems. Reports from a senior army officer in Delhi indicated that Beijing was providing live intelligence inputs to Pakistan regarding Indian military positions. While India refrained from making a public declaration against China, this situation sparked widespread debate about whether Delhi should continue pursuing the normalization of relations with Beijing.
Fast forward to less than six months later, and peace talks between the two Asian giants are experiencing a boost, influenced by developments thousands of miles away in Washington, D.C. The Trump administration has imposed a staggering 50% tariff on Indian imports, claiming it was a response to India's refusal to cease oil purchases from Russia. Faced with this unexpected pressure from a traditionally allied nation, India found itself at a crossroads with two clear options.
The first option was to yield to U.S. pressure and halt its imports of Russian oil. However, India has steadfastly refused to do so, primarily because Russia is considered an all-weather ally, and succumbing to external pressure does not align with Prime Minister Narendra Modi's strongman image. The second option was to remain resolute and explore other opportunities, which appears to be the path India has chosen for the time being. In this context, it makes pragmatic sense for India to engage with China, given its status as the world's second-largest economy and a global manufacturing powerhouse.
In light of these geopolitical dynamics, Prime Minister Modi recently met with Chinese President Xi Jinping in Tianjin. Although the statements released by both sides were light on specifics, they expressed a commitment to working through their differences for the benefit of their combined population of 2.8 billion people. A significant outcome of the meeting was the announcement of the resumption of direct flights between India and China, along with efforts to simplify the visa issuance process.
However, despite these promising gestures, India and China still face substantial challenges that must be addressed before meaningful engagement can occur. The most pressing issue stems from their recent history; Modi has made significant personal investments in the India-China relationship since assuming power in 2014, including five visits to China by 2018. Unfortunately, the 2020 border clash put a halt to this momentum, and it has taken seven long years for Modi to visit China once again.
The key to fostering progress in India-China relations lies in how both nations manage their ongoing border disputes. Currently, tens of thousands of troops from both countries remain stationed at their contested borders, although discussions between civilian and military leaders are underway to alleviate tensions. Official statements from both sides following the recent meeting emphasized the importance of maintaining peace along the border and avoiding disputes arising from their differences.
Additionally, India faces a burgeoning trade deficit with China, which has reached over $99 billion (£73 billion). Both countries continue to impose high tariffs and duties against each other in various sectors. While Beijing is likely to push for India to open its market of 1.4 billion consumers to Chinese products, Delhi remains cautious about doing so without first addressing the trade deficit.
The outreach to China, initiated with Modi's meeting with Xi in Kazan last year, has been significantly accelerated by the imposition of Trump tariffs. Nevertheless, the ground realities for India remain unchanged. The Modi-Xi meeting is seen as part of India's strategy of strategic autonomy, but it also presents new geopolitical challenges for Delhi. India is set to host the Quad summit later this year, which includes Japan, Australia, and the U.S., and is perceived as a counterbalance to China's influence in the Indo-Pacific region.
It's uncertain whether Trump will attend the summit, but if he does and makes critical remarks about China, it could immediately test the renewed rapport between Delhi and Beijing. Furthermore, India participates in numerous multilateral forums that are viewed as anti-China and anti-Russia. How Delhi navigates its strategy of autonomy in the upcoming months will significantly influence the trajectory of India-China relations.
At present, it is evident that India-U.S. ties are experiencing a significant downturn. A Trump aide recently referred to the ongoing Russia-Ukraine conflict as "Modi's war," and Delhi has consistently denied any role played by Trump in the ceasefire negotiations between India and Pakistan in May, which has become a point of contention for the U.S. president. Despite these frictions, India has opted not to impose retaliatory tariffs against the U.S. and has left the door open for further negotiations, recognizing that the U.S. remains India's largest trading partner.
As India seeks to strengthen its relationship with China, the critical question looms: will this rapprochement aid India's negotiations with the U.S., or will it adversely affect them? This pivotal question is likely to dominate geopolitical discussions in Delhi and beyond in the coming months.
