India and china relations have seen many constraints in recent some years.

The recent developments in India-China relations have raised concerns about the possibility of a future conflict between the two nations.

Recent strains  in India and China’s  relationship has been fuelled by recent Chinese provocations, including the allocation of names to places in Arunachal Pradesh, denial of visas to Indian media personnel, and President’s statements on preparing for war.

What is the recent cause of concern?

• India-China relations have gone through cycles of conflict and cooperation over nearly 75 years.
• The most serious recent episodes of conflict were in Galwan Valley in Ladakh in 2020 and in Tawang in Arunachal Pradesh in 2022.
• Observers on both sides of the border—the Line of Actual Control (LAC)—agree that the number of serious military confrontations has increased since 2013.
• The border between India and China is not clearly demarcated throughout and there is no mutually agreed Line of Actual Control (LAC) along certain stretches
• Partnerships with each other’s main enemies, including the Soviet Union/Russia and the United States, have prevented them from becoming strategic partners and cooperating on strategic matters
• The growing power gap between China and India, with China’s GDP being five times that of India’s, has made it difficult for India to be accommodative without appearing to surrender.

Imbalance of trade relations

• India’s bilateral trade deficit with China is large and growing. In 2021-22, India’s trade deficit with China was around $73.3 billion, and it is expected to cross $100 billion in FY23.
• India’s trade deficit with China accounts for 38-40% of India’s total merchandise trade deficit in the post-Covid era.

Reasons for Intriguing Trade Relations

• China’s GDP growth rate has slowed down since the Covid crisis, and the country has shifted its policies more towards domestic consumption.
• However, this policy shift has not affected Chinese exports to India.
• India withdrew from the Regional Comprehensive Economic Partnership (RCEP), which puts India at a disadvantage compared to other FTA partners of China.
• India imports most of the Active Pharmaceutical Ingredients (APIs) it uses in its pharmaceutical industry from China. The cost of Chinese APIs is cheaper than the Indian ones even on the Indian market.
• The depth of the problem was revealed during the Covid-19 pandemic when due to travel restrictions, exports of Chinese APIs to India were temporarily restricted and consequently India had to cut its exports of APIs
• China has become a manufacturing hub for the world, with a vast industrial base that enables it to produce goods at a lower cost than India. This has led to China exporting a wide range of products to India, from electronic goods to textiles.
• India is heavily dependent on Chinese goods, as it imports a significant amount of raw materials and finished products from China.
• This includes items such as machinery, electronics, and chemicals

There is need to reanalyze relations between two countries to get mutual wider benefits in wider geo political arena.