China is using its economic relations and positive trade surplus as tools to develop potential military power status in Asia’, In the light of this statement, discuss its impact on India as her neighbour. (15 Marks)

Mentors Comments:

  • Give examples of military intrusion by China in the neighbourhood.
  • Highlight the economic tools used by it, to push forward the military agenda.
  • Discuss the impact in India and how it can be dealt with.


China has managed nearly double-digit growth rates since it began economic reform and opening in 1978 although slowing down in the past few years. Joining the WTO in 2001 was a turning point in China’s integration into the world system and evolve into the manufacturing hub of the world. Earning a trade surplus for decades under the export-led growth model has enabled China to accumulate forex reserve of 3.096 trillion dollars. 

In 2019, the Chinese government’s official defence spending figure was 175 billion USD making China’s military budget second largest in the world behind the US. 

Under Belt and Road initiative launched in 2013 China is using its economic might to develop strategic relationships and propelling itself into a potential military power in Asia.

Such a situation potential impacts on India as China’s neighbour are:

  • Economic: India has a large trade deficit of around 53 billion USD with China which is the largest among its trade partners. India’s recent withdrawal from the Regional Comprehensive Economic Partnership (RCEP) Agreement was in concern of overflow of imports from China.
  • Strategic:
    • China could emerge as a direct military threat to India as has been seen in the recent Doklam standoff and other border disputes.
    • China has been able to develop quality infrastructure along the border with India which may provide a strategic upper hand.
    • China seems to be developing a string of pearls, which is a series of ports in the Indian ocean aimed at isolating India.

  • Neighbourhood: All of India’s neighbours have joined China-led BRI except Bhutan. This may provide China with a strong foothold in the region in case of any conflict.
  • Political: China could use its clout to sideline India in multilateral forums as visible in cases such as 
    • UN Resolution of terming Masood Azhar an international terrorist which was initially vetoed by China
    • China’s opposition to India joining Nuclear Suppliers Group.

However, India has not been a silent spectator and has initiated three-fold response:

  1. Actively engaging China through platforms such as BRICS, SCO and informal dialogue such as Wuhan and Mamallapuram to build mutual trust.
  2. Initiatives such as Act East, BIMSTEC, QUAD (an informal group of India, US, Japan and Australia), Neighbourhood First, etc aimed at building its own regional and global partnerships.
  3. Investing in its own Military and Naval capabilities in Indian Ocean region through initiatives such as Project 75I (Kalvari class submarines), developing IND Vikrant – an indigenous AirCraft carrier, SAGAR initiative, leasing Duqm port in Oman, etc.

India and China are not necessarily adversaries in Asia rather can be engaging partners in Asian growth century. Still, India must not discount the importance of its own policy response and focus on building indigenous military power and forging regional cooperation at the same time. 

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4 years ago

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Reply to  Paran Pabbi

*not checked*

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Reply to  Parth Verma

Okay, Sir!

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3 years ago

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