The Complexities of Indo-China Relations: History, Trade, and Politics

This essay provides a comprehensive analysis of the Indo-China relationship, tracing its evolution from 1950 to the present day. It begins with a historical overview, highlighting key events such as the Panchsheel agreement and the 1962 war, and then delves into the contemporary issues that shape the relationship, including boundary disputes, trade dynamics, and political tensions. The essay examines the perspectives of various scholars, reviewing literature that offers insights into the complexities of the Sino-Indian relationship. It explores arguments regarding the potential for cooperation and conflict, considering the role of trade, cultural exchange, and strategic competition. The essay concludes by assessing the future prospects of the relationship, considering factors such as economic interdependence, military capabilities, and the influence of external actors like the United States, ultimately arguing that while there are significant challenges, the economic and cultural ties between the two nations offer hope for continued engagement.

Running head: INDO-CHINA RELATIONSHIP
Indo-China Relationship
Name of the university
Name of the student
Author note

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Introduction
The purpose of this paper is to present the current relationship between India and
china and the way it has been evolving since the year of 1950. Since the ancient period,
Chinese travellers and a huge number of Chinese students used to visit Nalanda University in
Bihar, India. India was the first country to establish political relationship with China in 1950.
Prime Minister Nehru’s visit to china in the year of 1954 confirmed an agreement of
maintaining mutual peace termed as Panchsheel, which was consisted of five principles.
However, the agreement did not last as China attacked India in 1962. Although, after 14 years
both signed the peace agreement again yet these two countries do not share a pleasant
relationship in contemporary times (MAHBUBANI, Jing & BAJPAI, 2015). Various tensions
are going on between these two countries starting from political and international boundaries
to trade and cultural issues. At first, this paper will discuss the history of events, which will
clarify the reasons behind the deterioration (Rao, 2014). With the help of few academic
journals, further dimensions are going to be added to this topic. Afterwards, this analysis will
raise an argument whether the internal matters can be resolved and a fresh start can be
initiated or not. There is a high possibility of deterioration as China maintains a bond with
Pakistan consistently (Ahmed et al., 2016). On the other hand, trade can be considered as one
of the biggest factors working as a bridge between two countries. Both the nations are
dependent on each other in terms of investment and business exchanges (Afsharipour &
Rana, 2013). Moreover, a steady growth in both the economies has been noticed in past ten
years. Still, the fact cannot be denied that the relationship has always been complicated and
controversial as well. The central argument revolves around whether these nations can work
towards the development of interpersonal relationship.

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History of Indo-China relationship
When the peace agreement was signed between Chinese and Indian government back
in the year 1954, there were five major principles, which were meant to be followed. One of
them was to maintain a mutual peaceful co-existence without interfering in each other’s
internal matters. Issue of Tibet has always been central point of disagreement between these
two nations. Although India tried to make China understand the fact that lets Tibet deal with
its own issues and let the territory be self-ruled yet China prepared themselves to annex it as
well as refused to go for further negotiations with Dalai Lama. In 1951, with the help of
signing an agreement it was decided that except internal affairs China has achieved a control
over Tibet’s external affairs, communications and trade policies. However, India did not react
strongly against this step of China as they were under Panchsheel agreement. Yet with the
attack of 1962, China broke the agreement and for the next 14 years both the countries
suffered. Meanwhile, China established a relationship with Pakistan (Siddique, 2014), which
resulted in Pakistani attack on Indian region in 1965. China was supporting Pakistan in the
case of Kashmir and their anger increased with Sikkim’s accession to Indian Territory (Javaid
& Jahangir, 2015). However, the relationship started to develop as Mrs Gandhi took effective
international policies to handle this sensitive situation. As a result, business and cultural
exchange increased which strengthen the economic relationship yet numerous issues have
been remained unresolved. Before moving on towards critical analysis of literature on this
agenda a brief introduction of contemporary issues are needed. One of those issues are
boundary dispute (van Eekelen, 2015). China shares almost 2,000 kilometres of border area
and the boundary has never been officially certified. After 1990, the situation of tensions and
confusions progressed as several agreements were signed by these countries. In future days,
China has equally supported India to fight against terrorism even after acknowledging the
issues between Pakistan and India on the aspect of terrorism. There were a series of political

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events, which created the tension first, and then it was removed by some diplomatic policies.
On this context, current relationship between these two nations will be evaluated and
argument will be raised whether there are further chances of developing the relationship in
future to avoid war situation.
Literature review concerning indo-china relationship
Most of the scholarly articles presents the relationship in a pessimistic way as far as
potential of development is concerned. Hardwar, (2013) in the article ‘The India-China
relationship possible new paradigm’ the relationship between these two nations is required to
“Cast off the transient and reveal of truth”. These wise words have been quoted from a
Japanese Buddhist priest which can applied aptly to the authentic Asian values and practices
of cooperation, acknowledging other’s sufferings and believing the immense power of life
and refusing the mentality of destruction. According to this study, India was manipulated and
trapped into an ‘anti-Chinese’ matrix, framed by United States of America. As a result of this,
internal tensions between the governments of both the nations are increasing day by day.
India as a developing country cannot afford the war with China. It will not be an exaggeration
if it is stated that, India needs more than a century to reach the level where China stands now.
The study, “Indo-China relations: Bonhomie with Ambivalence” conducted by
Horiatis, (2012), critically examined the complications of bi-lateral relationship between two
countries. The issues of Bonhomie with Ambivalence has been highlighted here. Before the
war of 1962, both the countries were facing sensitive border dispute and an uneven
distribution of power structure was noted (Hoge, 2015). The atmosphere of international
tension developed after 1990 as well as based on flexible economic policies bi-lateral
interactions gradually started to become smoother than before. This study has elaborated the
positive aspects of mutual exchanges, which are consistent cooperation in multinational
issues and commercial relationship, yet the author did not forget to analyse the negative

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factors like long-term boundary dispute, the disagreement with China’s South Asian policy
and several cases of violation against the agreement, which affects the relationship badly.
International atmosphere hardly plays an important role in the internal and economic issues
between these two countries.
Chakraborty, (2012) in his paper, “Weighing India-China relations in the 21st
century: An Analytical Assessment under the NDA and UPA Governments” presents a
comparison of India’s relation with China under the rule of two different government. The
analysis clears the fact that NDA government handled the issues with China with intense
priority whereas; UPA government did not frame their policies focusing China. The strong
bilateral trade relationship and high rates of business exchanges have been working as
positive factors, which are able to eliminate the tension of international diplomatic policies,
relation with other countries and it has gradually started to remove mental distance between
two nations after the war of 1962. While implementing new business laws and creating a
global approach China and India have followed the same path, which has brought them
closer. The author has stated in the conclusion that NDA government implemented more
visionary policies to improve the relationship with China than UPA.
In the study, “Samudra Manthan: Sino-Indian Rivalry in the Indo-Pacific”, the author
Mohan (2013) introduces a new theory with the reference of a much familiar Indian fable to
illustrate the contemporary situation. The book is based on ‘maritime strategy’ and the central
topic revolves around the features of Indo-Chinese ‘maritime competition’ considering the
Indo-pacific region (where tropical water of Indian Ocean is mixed with Pacific Ocean). As
USA controls the power in this region, the author has highlighted the role of Untied States in
the increasing rivalry between China and India. Mohan has elaborated the fact that both the
nations are oriented with boundary dispute since the ancient time. Asia pacific region is
considered as a region with which India shares fastest growing external economic

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relationship. Whereas, China considers Indian Ocean as a hindrance while exporting products
to other continents like Europe and Africa. USA’s crucial role has been critically analysed
here by the author regarding Indo-Chinese maritime rivalry. As numerous aspects of Indo-
China relationship are directly dominated by USA, therefore a triangular relationship in
coming in front (Hayes, 2013). Although, USA does not prefer China as they are on strong
agreement with Pakistan still there is a high possibility that China and USA being more
developed and powerful country jointly can isolate India as a less powerful developing
country (Isaacs, 2015). On the other hand, China can take initiative to resolve boundary
dispute with India as well as encourage the healthy cultural and commercial relationship
between them rather than a competitive one.
Arguments on the Sino-Indian relationship
Considering the contemporary scenario of Indo-China relationship, it can be said that
trade relationship is the only factor which keeps the interaction positive (Bajpai, Huang &
Mahbubani, 2015). Apart from that, China and India share a glorious cultural history as well.
Yet there are some long-term political and internal issues, which keep disturbing the peace
between nations. As a result, a mutual relationship of distrust has evolved, though
cooperation is there in various sectors (Arif, 2013). Therefore, a theory of contradiction
comes in front when the future of Sino- Indian relationship has been questioned. The first one
states that being powerful both the countries can engage themselves into war to fight for
dominance in Asian regions. The possibilities of military confrontation between these two
countries cannot be denied as India and China, both are equipped with nuclear weapons and
both of them are consistently increasing their capabilities in these sectors. Although, there is a
different argument whether India can afford war with China or not as China is more
developed than India is today. Still, this factor can be ignored considering the fact that India
has the capability to import military technology in order to succeed. Again, a liberal

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perspective can be discussed considering the mutual business opportunities of China and
India. Both the countries can maintain the peaceful co-existence depending on each other’s
business prospect. However, Indians consider China as a threat and a mental distance remains
the same in modern times as well. The intention of raising the argument is to evaluate the
future of Indo-China relationship: whether it is going to sustain or not in this complicated
environment.
There are two central aspects, which strengthen the fact that there are still hopes of
improvement. Bi-lateral trade relationship between two nations is consistent and growing
rapidly with the progression of time. India exports diamonds, cotton, copper, iron ore and
chemicals to China and these products are leading the market. India is considered as second
largest exporter of both diamonds and cotton to Chinese countries as of 2016. In the same
year, Indian exports of iron ore received a hike. Chinese export of electrical goods and
fertilizers in India has received positive feedback (Fuller, 2014). India is the largest
destination of exporting anti biotic and second largest as far as the exportation of organic
chemicals is concerned. Seven Indian banks have branches in china and here in Mumbai there
is a representative branch of Chinese bank ICBC. In China the presence of Indian embassy as
well as Chinese embassies are present in all the major cities of India. Both the embassies
maintain consistent communication, with the universities as well to improve educational
exchange. Occasionally, Chinese embassy officers visit universities to interact with Indian
students in case any emergency arises during their stay in China. Therefore, in the midst of an
environment of distrust both the countries are consistently maintaining a relationship of
cooperation, as they do not want to face economic loss. Several genre of Chinese businesses
such as, restaurants, electrical appliances and salon are rapidly increasing. Even Kolkata, one
of the metro cities of India, has a separate Chinese community who celebrates and observes
their festivals and culture amidst of an entirely different culture of Bengal (Pan, 2014). It can

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be said, these examples would not exist if the elements of cooperation were not present
(Gancheng, 2015). Economic and commercial relationship determine the environment of
mutual dependency yet former experiences and power imbalance between two countries are
the central reasons of disagreement. As both the countries’ economy are rapidly growing,
China is expecting a strong competition from the opposite end. Several business predictions
have shown the results that within almost 12 years India can compete with China. Being more
powerful, a tendency of occupying new lands by military confrontation can be noticed in
Chinese mentality, which creates the internal tension.
In order to talk about Sino-Chinese cultural interactions, some historical evidences of
exchanges should be considered with greatest priority. The evidences of exchange between
Indian Vedic Civilization and Shang-Zhou civilization are found distinctly. Being the
immediate neighbour the curiosity of discovering new aspects were present in ancient times
as well. Buddhist pilgrims and eminent Chinese travellers visited India through historical silk
route in Sikkim and scripted their written account on India (Summers, 2016). The regular
interactions of Chinese students with Nalanda University has led the Indian government to
establish Xuanzang memorial at Nalanda. Apart from these, there are numerous Buddhist
temples have been erected in the Indian provinces. Bollywood movies have a great impact on
Chinese audiences. China has been thinking to invest in this sector too. They are much
interested about Indian performing arts and culture. Indian festivals and its history amaze
them. The historic significance of silk route regarding cultural exchanges is highest among all
the factors. PM Narendra Modi’s initiative to observe international yoga day has impressed
Chinese population. During his visit in china in the year of 2015, an agreement was signed to
build a yoga college in Yunnan region of China. Besides, Chinese cuisine is famous
throughout India. Though there are scarcity of authentic Chinese food, yet in Territy bazar,
Kolkata, one can find authentic and homemade Chinese spices and sauces and the entire

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market is operated by the Chinese community of that place. In China, an increasing rate of
Indian community delivers a positive vibe. Major part of the Indian community in China
consisted of students and there are expatriates as well who are working in different Chinese
and Indian multinationals (Cooke, Saini & Wang, 2014), (Kothari, Kotabe & Murphy, 2013).
Although, there are several examples of cooperation yet the former bitter experiences
of Chinese violation and the long-term border dispute have always been the bone of
contention between these nations. There is a famous saying by Kautilya, “Every neighbouring
state is an enemy and the enemy’s enemy is a friend.” The fact is known to all, that China
shares border with India (Ma, 2014). According to the saying, being the immediate
neighbour, both the countries cannot possess a healthy relationship. Surprisingly, reality
supports the saying literally and China considers India as an enemy whereas Pakistan as a
friend just because India and Pakistan shares a bitter history of partition. Although, China is
fully aware of the fact that Pakistan is the country, which is viewed as a country of terrorism.
Respecting all the religious issues, it cannot be denied that most of the terrorist organisations
are originated in Pakistan. Still China maintains an all-weather friendship with the country to
weaken India from every possible aspect. Indian economy is growing at a rapid rate and
within few years, it will reach the level Chinese economy according to the business
predictions. China is afraid of the fact that with such rapid pace, India will achieve the
excellence and their country will be lagging behind. However, China never misses a chance
of investment in India and vice versa. Both the countries share an amazing business
relationship amidst of several issues of boundary dispute. The relationship is a perfect
example of cooperation with distrust. Back in the time of 1950’s when Panchsheel was
signed, countries were under agreement to have a mutual understanding and to maintain a
peaceful coexistence. In the case of annexing Tibet to Chinese territory, India raise
opposition yet they could not react seriously, as they were under Panchsheel agreement.

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However, China was the first to violate the agreement with the declaration of war in 1962. It
is true that immediate neighbours cannot be friends, yet without cooperation they cannot
sustain either. Therefore, acknowledging all the aspects of disagreement and bitter
experiences both the countries are consistent in helping each other. Again, the tendency of
occupying Indian territories like Arunachal Pradesh, which has been strongly discouraged by
Indian government (Rahman, 2014). On the other hand, there are several local parties, which
are in favour of China and influencing natives towards their objectives. China has not
succeeded yet in their goal and as far as this issue is concerned, there is least possibility of
success in near future. Sikkim was an autonomous state until contemporary PM Indira
Gandhi annexed it as an extended part of India. The following events were not very pleasant
as a conflict occurred between two nations concerning the rights of Indian PM to take such a
step as Sikkim situated in the middle of India and China. Several attacks and counter attacks
are consistently occurring and in most of the cases, China is breaking the agreement of
peaceful coexistence.
Conclusion
The purpose of this paper was initially to deliver an insight of Indo-china relationship
in contemporary times and the way it has been evolving its nature starting from the ancient
times. After evaluating the history of continuous rivalry least possibility of development can
be seen. Yet, in modern times, the improvement of commercial exchanges has played a
crucial part in order to maintain a helpful partnership. There are numerous academic journals,
which have presented several dimensions of their relationship and the way it can be
transformed for betterment. Considering all the positive aspects of business and cultural
exchanges there is a hope of improvement though the long-term boundary dispute and
China’s aggressive policies of capturing territory by military confrontation consistently
creating tensions in the international environment. Therefore, it can be concluded that the

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nature of Sino-Indian relationship has always been controversial and complicated. Still there
are possibilities of improvement, if China gives up aggressive unethical policies of war and
continues the process of mutual support. Internal issues should be resolved under highest
priority to avoid future possibilities of war and economic loss. Therefore, if both the nations
realise the advantages and give up the feeling of unnecessary hatred, immense opportunity
can be identified as far as improvement of international relationship of India and China is
concerned.

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