Asia's Not Too Friendly Power Play

As modern diplomacy between the ancient civilizations of China and India turns 60 years old in 2010, their evolutionary relationship is raising fundamental questions about the world's geopolitical and economic balance.

Mirroring China's rise since the late 1970s, India has transformed over the past 20 years ago from what seemed a hopeless state into the fastest developing democratic country in the world. Assuming China and India maintain current economic growth rates, the largest economies in the world in 2050 will be China followed by the United States and India. At that point, the global influence of Beijing and New Delhi will rival and possibly surpass that of Washington.

Indeed, the economies of China and India are and will continue to be driving global forces. Both are industrializing. They have large levels of investment capacity, and their respective labor forces have migrated from countryside to urban areas. Both are forming necessary prerequisites to sustained growth.

The economies of China and India appear to have shaken off the most serious effects of the world financial crisis and are stepping onto normal development paths. Over the next decade, accelerating industrialization will help China and India welcome large-scale increases in consumption. Whichever country first realizes an economic transformation from simple numbers growth to focused, sustainable growth, will take development a step further.

The China development model and India's model both have merit, with their influence on developing nations more evident. And as they develop, their competition is quietly escalating. Since both border Southeast and Central Asia, overlapping interests and mutual infiltration have surfaced. Both countries are devoted to expanding their political and economic influence in the Asia-Pacific region.

Security Competition

In terms of maritime competition, two major issues of contention have arisen: China has increased its presence in the Indian Ocean to protect interests and enhance transportation safety, even sending its military to patrol and combat piracy. India, on the other hand, has extended its presence in the Pacific Ocean, frequently conducting joint naval exercises with the United States and Japan.

After U.S. President Barack Obama took office, the center of the front for the war on terror shifted from Iraq to Pakistan and Afghanistan. As a result, southern Asia is changing.

Traditionally, India has viewed all southern Asia as its sphere of influence. But in the war on terror, the United States cultivated ties with India as well as Pakistan, signaling efforts to turn India into a global strategic partner for maintaining political balance in Asia. It's been hard for India to resist the benefits of an alliance with the United States. Yet Pakistan is also a key U.S. ally for fighting terrorism. India can only keep one eye open and another closed over U.S. support for Pakistan. It's even harder for India to speak against U.S. troops in Afghanistan. And India's slipping influence in southern Asia has extended to smaller countries, motivating its decisions toward faster infiltration of Nepal and closer ties with the Maldives.

Pakistan's internal strife prompted a shift in India's national security focus. Problems of strategic imbalance emerged as Pakistan can no longer implement an offensive national security strategy toward India.

Under these conditions, India's national defense strategy is preparing a significant shift to focus on China and away from defending against Pakistan. In recent years, India started large-scale military construction projects to raise defenses along the Sino-Indian border. India is spending more money on nuclear submarines, intercontinental missiles and space defense systems as well, which are seen by many as signs of preparations for possible future conflict with China.

Sino-Indian relations could become more strained. Competition for influence over Nepal and Sri Lanka could intensify. India has increased investments in these countries to prevent China from getting footholds, even to the point of actively interfering with political and social stability in small countries. Quadrilateral relations between China, India, Pakistan and the United States are gradually superseding trilateral relations between China, India and Pakistan, so that China will watch with caution the United States' efforts to let India join the Asian Alliance for Democracy and provide India with nuclear fuel and technology. At the same time, India will focus on guarding against Sino-Pakistan strategy and military cooperation. Third, India's response to China's increased presence in the Indian Ocean will likely involve making every effort to guard its backyard.

A China-India border dispute was a prominent issue in 2009. India did not bend in negotiations but increased troops in the disputed region. The country also reinforced its occupation of the border area near southern Tibet, attempting to force China to compromise. The antagonism eased toward the end of the year, but these steps may influence Sino-Indian relations in 2010.

In the future, China and India may face new challenges tied to competition for water. The Indian public thinks China will develop water resources on the Tibetan plateau, and that a water war may break out. China has expressed doubts about India's north-to-south water transfer project and its internal river network projects which involve building a dam on the Yarlung Zangbo River, which passes through the disputed border area. Chinese authorities think the dam construction will lead to flooding in a section of Tibetan forest along the upper river and endanger Bangladesh's ecosystem.

Mutual Benefits

Yet as rising Asian economic powers, China and India can boost cooperation in search of mutual benefits. As Indian Prime Minister Manmohan Singh has stated: "There is ample space in the world to accommodate the growth ambitions of both India and China." So both countries will seek consensus and expand mutual benefits. Any disagreements pale in comparison to the vast mutual benefits, of which at least three important stand out.

The first is the common task facing all developing countries that want to maintain independence and autonomy in foreign policy. They are seeking to promote global south-south cooperation and strengthen north-south dialogue.

The second difficulty involves challenges for all emerging superpowers: Breaking through old power structures, vying for international voices, and pushing forward a pluralistic world view. There is vast area for cooperation with great strategic benefits for China and India in these areas, especially in areas of climate change, energy security and international financial system reform.

Finally, a common interest that would benefit all Asian countries involves protecting the region's interests, promoting Asia's rise on the world stage, strengthening regional cooperation and accepting common responsibilities.

As rising economic powers, China and India will encounter problems. But as two countries with ancient civilizations, they should reject western historical practices that are based on exclusiveness and exploitation. Instead, they should adopt policies of inclusiveness and balanced development, while working together to resolve disputes.