Will China’s ‘Reset’ With India Work?

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Will China’s ‘Reset’ With India Work?

India will accept China’s economic overtures but it won’t abandon its strategic mistrust so soon.

Despite China’s attempt at an early foreign policy “reset” with India following Narendra Modi’s election victory, it appears that it will take more for Beijing to convince New Delhi to abandon years of strategic mistrust towards Beijing. While Modi is willing to expand economic cooperation between the two countries —as he indicated he would when he met with Chinese foreign minister Wang Yi in early June 2014 — his government’s actions so far suggest that New Delhi won’t be rushing to abandon its strategic status quo vis-a-vis China, at least in the northeast. Two recent developments support this assertion: Modi making his initial trip abroad as prime minister to Bhutan, and his party’s recent decision to earmark funds for actively promoting development and settlements along the disputed India-China border in Arunachal Pradesh.

On the face of it, Modi’s Bhutan trip was primarily appreciated as an attempt by India’s dynamic new leader to directly engage smaller regional countries in an attempt to cement India’s regional status. His decision to travel to Bhutan was announced not long after his decision to invite all of South Asia’s heads of government (including the Tibetan leader-in-exile Lobsang Sangay) to his inauguration as prime minister in New Delhi. Bhutan was a particularly sensible choice as the country is rather reliant on India for its own security and is currently navigating a stagnant territorial dispute with China. While Bhutan has become more independent in its foreign policy since the 1970s, when it acquired U.N. membership, it used to have India represent its interests when it came to diplomacy with China.

Modi’s visit happened just a month before scheduled talks in July between Bhutan on China on their border dispute. Given China’s tendency to prefer settling border disputes on a bilateral basis, India is keen to provide Bhutan some leverage in negotiations. While Bhutan has a rather limited defense capability, it could grant access to Indian forces to defend its northern disputed border against China should Beijing pursue aggressive terms in the negotiations. Bhutanese concessions also stand to affect India’s vital strategically vulnerable Siliguri Corridor. For the moment, China appears to be unconcerned by Indo-Bhutanese rapprochement. “We are paying attention to the Indian prime minister’s visit. We are glad to see our neighbors develop friendly ties with each other,” noted Hua Chunying, spokesperson from the Chinese foreign ministry.

As I noted earlier this week here on The Pulse, the Modi government has earmarked around $830 million for specifically developing infrastructure and civic services in the uninhabited borderlands of Arunachal Pradesh. Following the 1962 war between India and China, New Delhi has given relatively little development attention to the Arunachal borderlands out of concern that if a repeat of the war were to occur, Chinese forces would be able to be use the infrastructure to quickly gain control over a large swathe of territory. To its credit, the most recent United Progressive Alliance-led coalition government began to give some thought to development in these areas. In 2009, the Congress-led government deployed two mountain divisions in Arunachal as well. The new BJP-led government intends to continue this policy, betting that China would be hesitant to take any action against densely inhabited areas. Most of China’s land and sea territorial disputes involve sparsely inhabited or entirely uninhabited territory. By encouraging development and inhabitation, India strengthens its administrative claims to Arunachal Pradesh.

Notably, the government announced this initiative shortly after Wang made an overture on the border issue, pledging that China was willing to settle these disputes once and for all. China currently administers Aksai Chin in Kashmir and has done so since the 1950s. One possible “grand bargain” between India and China on their border disputes might involve a tit-for-tat solidification of the administrative status quo where China would recognize Indian sovereignty over Arunachal Pradesh and in exchange India would formalize the Line of Actual Control (LoAC) in Kashmir as the formal border between the two countries. By extending its administrative claims and infrastructure to the McMahon line (the border between Tibet and Arunachal Pradesh), India reduces any ambiguities about exactly what portions of Arunachal are under its administrative control and inhabited by its citizens (China claims over 90 percent of Arunachal Pradesh). This is all highly speculative though — Xi Jinping is expected to travel to India this fall. If India and China do begin dialogue in earnest about their disputed borders, that’ll be the time to do it.

If any Indian leader has the ability to sideline years of pent up strategic anxiety about China’s intentions and focus on the positive sum economic relationship, it is Narendra Modi. However, at least in his first hundred days in office, Modi and his party have not made this a priority and have taken steps to double down on India’s claim to the disputed territory of Arunachal Pradesh. In particular, the decision to actively promote infrastructure development and settlements along the disputed border in Arunachal Pradesh represents a reversal of a long-standing policy that was hardly touched by Congress Party governments since the 1962 war. So far, Modi and the BJP have shown that they are not content to let territorial issues slide as they pursue economic rapprochement with China, but will instead stake out political capital on new policy initiatives.

It is worth noting is that neither supporting Bhutan nor developing infrastructure in Arunachal Pradesh will cause China to abandon the new sort of foreign policy vision that was set out by Wang during his visit to New Delhi. China’s policy towards India might increasingly be driven by its own awareness of its strategic isolation inside the First Island Chain, including the South and East China Seas where it is increasingly pursuing its territorial claims. Maintaining a strategic detente with New Delhi and focusing on economic cooperation in the meantime is advantageous for Beijing, and it hardly sees New Delhi under Modi turning down the offer. Meanwhile, Modi might see this strategic detente as an opportunity for his government to build up a stronger bulwark to Chinese adventurism along the border in the future should China reverse course in due time.

For a continuation of this discussion, see our most recent podcast where The Diplomat‘s editors discuss China-India relations under Modi.