India and China agree that the global political architecture is undergoing a fundamental transformation with gravity increasingly shifting from the Atlantic to Indo-Pacific. Both have pronounced the 21st Century as India’s, China’s or Asian Century. However, the fate of this century will be determined by the relationship between the two, for the relationship will not only define the contours of new global political architecture in Asia, but also the world at large. Therefore, at the global and multilateral level, both have found some convergence of interests on issues such as climate change negotiations of yesteryears and democratization of the international financial institutions. The multilateralism has also been used to strengthen the bilateral relations, and both are working towards having larger stakes in each other’s economies through complementarities. Due to the huge trust deficit, both have remained suspicious of each other’s intentions, and are overcautious when it comes to trade and investment.
As far as political clout, economic, and military trajectories of India and China are concerned, there is a visible asymmetry—and the gap is widening. However, it is widely believed in India that within a decade, India will emerge as the third largest economy in the world. It is in this light that the rise of India and China has been termed the contest of the century on the one hand and the most defining relationship of our times on the other. Not only are their civilizational spheres of influence in Indo-Pacific being reinforced and contested, but the same has been extended to new territories across Central Asia, Middle East, Africa, and Latin America as both strive to find strategic space, energy resources, and markets to fuel their growth. Meanwhile, the demon of unresolved issues left over by their history, such as border disputes and Tibet, will continue to haunt them, as these are hypersensitive issues capable of flaring animosities instantaneously. It appears that India has no real bargaining leverage with China as far as the border issue is concerned. The leverage India had in Tibet, the only vulnerability of China vis-à-vis India, has also been lost with the passage of time.
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