WORLD NEWS

When Chinese Premier Li Keqiang arrives in New Delhi on May 19, it will be as the leader of an invigorated state pursuing the so-called Chinese dream of prosperity and national pride.
With its top leadership for the next decade now firmly in place, the world's second-largest economy is anxious to position itself as a world leader and distance itself from the United States. China is focusing instead on its near-abroad: First Moscow, where President Xi Jinping made his first state visit last month, and now New Delhi, its traditional regional rival, where China is looking to boost economic ties despite the long litany of political differences.
Yet China has chosen an unorthodox beginning to such a monumental state visit, clouding it with the most serious border incident between the two countries in decades. On April 15, a platoon of Chinese troops moved 19 km inside what India considers its area of administration, in the Daulat Beg Oldi sector of Ladakh. Then, with helicopter backing, they pitched tents to settle in.
While Indian television blasted warnings of Chinese aggression, back in Beijing, the government kept an unusual silence, with state media reporting only subdued accounts and officials denying the soldiers had strayed from what China sees as its territory.
The standoff between the People's Liberation Army and Indian troops who moved in afterwards continued for nearly three weeks, when alarmed negotiators finally agreed on a simultaneous withdrawal-just in time for a scheduled visit to China by Indian Foreign Minister Salman Khurshid.
Why the incursion happened now is still unclear. Was it fuelled by Chinese concern over Indian structures at Fukche and Chumar, or simply a reminder that the border negotiations should resume? As Premier Li prepares for his first trip abroad since assuming political office, it reveals India's significance in China's foreign policy and the role China hopes India will play as its own global influence expands.
"China and India still have conflict over territory. It's a hidden danger for the China-India relationship as the border is not clearly demarcated. But my personal thinking is that the conflict will not influence the two countries' general cooperation," says Li Xiangyang, director of the National Institute of International Strategy at the Chinese Academy of Social Sciences, a government-linked research institute.
"India worries about China so much. Whether it's economic development or regional events, India uses China as a reference point. But China is not so worried about India," says Li.
An editorial in the state-backed China Daily newspaper on May 13 said as much. "That the much-hyped border incident was solved so quickly indicates the two neighbours are getting more mature in handling their differences," it read. "Both Beijing and New Delhi are at a new starting point and by inputting positive energy into their interactions they can lift ties to an even higher level. And as long as they continue to deepen mutual trust and cope with their differences in a constructive manner, they will prove to the outside world that the much hyped 'Dragon-Elephant' rivalry is nothing but a figment of the imagination."
That is not to say India's concerns about China's military ambitions are misplaced. Part of its growing national pride has been showing its military capabilities. China's defence budget has increased an estimated 175 per cent since 2003 and is now second only to the US. Regionally, Chinese and Japanese vessels have narrowly avoided conflict in recent months over Chinese claims to the islands known as Diaoyu in China and Senkaku in Japan, which controls them; China is also engaged in territorial disputes in the East China Sea with the Philippines and Vietnam.
Also of concern for India is China's close relationship with Pakistan. The two refer to each other as "all-weather" friends and China supplies military and nuclear technology to its neighbour; the two have strong economic ties and China sees Pakistan as a future route for exports from its western border and possibly imports from Pakistan's Gwadar port. However, here too the relationship is nuanced. China also has concerns that growing militancy in its western, predominantly Muslim Xinjiang region, may be fed by Pakistani spillover. Some of its own workers inside Pakistan-resented as modern colonials-have also been subject to attack.
{mosimage}Yet achieving the Chinese dream also requires the economic cooperation of its neighbours, however complicated the relations might be. Part of building this new prosperous China involves opening up its western regions, which have fallen well behind its flourishing eastern coastal cities economically.
So, while China may have set India on the back foot with this latest border incursion, there is recognition of its strategic importance.
"India has two assets: One is its strategic location in the Indian Ocean and the second is its developing strategic relations with the US," says Sandy Gordon, a visiting fellow in the College of Asia and the Pacific at Australian National University. "China is also really concerned that India's role as a future competitor might be enhanced by its relationship with the US and its strategic position."
Zhu Feng, deputy director of the Centre for International and Strategic Studies at Peking University, feels the visit may announce some kind of new climate to facilitate fresh negotiations on how to avert a confrontation in future. "What matters is what sort of impression he can leave with the Indian Government. In these coming 10 years, Premier Li will be a very important counterpart for the Indian Government," says Zhu.
Though economically they are rivals, the two brics nations also bear many similarities. They are the world's two most populous nations, with two of the fastest-growing economies. Both countries are facing the crushing infrastructure and social demands of rapid urbanisation; both are fighting corruption and social unrest among their poorest citizens; and both must lift their rural population out of abject poverty.
Despite the events in Ladakh, there are many signals from Beijing that China would prefer to focus on economics and regional issues.
Coinciding with Khurshid's visit was the release of China's first-ever Blue Book policy paper on India. Written in Chinese, mainly by Yunnan University academics, and designed as a primer on China's official positions on the country, the book warns that New Delhi's coalition government faces a crisis because of internal divisions and corruption scandals but largely steers clear of editorialising on border issues.
The elephant in the room during this round of talks will be Tibet. Though India has recognised the territory as part of China, to criticism in some quarters, China is still unhappy that the Dalai Lama's government-in-exile sits in Dharamsala.
Just over a year ago, when then president Hu Jintao was preparing to visit India, New Delhi was stunned when 27-year-old Jamphel Yeshi, a Tibetan who had been living in Delhi for several years, set himself alight. Images of his horrifying death went viral, plastered on both city walls and Facebook pages-though completely blocked in China, as is usual.
Any repeat of such protest during Premier Li's visit would be banned from the airwaves in China but result in loss of "face", that Chinese concept of preventing embarrassment at all costs for its leadership.
Political issues aside, what these two nations have most in common is a growing role in global economy. Both are seeing their previously rapid rates of growth slow down. With demand for both Indian and Chinese exports falling in the US and Europe, both nations will need to find new markets.
China is pressing for a regional trade arrangement, and relaxing of trade regulations that prevent Chinese firms from establishing themselves in India. Khurshid is said to have invited the Chinese side to examine the prospect of an industrial park for Chinese firms in India.
This part, at least, of China's pragmatic message-let's do business, despite the border differences-may not go unheard by India's leadership.
Premier Li will carry on to Pakistan and later to Europe. Analysts say it is no accident that New Delhi was chosen as the first stop. "This should set the stage, the two emerging powers' new partnership," says Li Xiangyang.
But after such a heated standoff in the Himalayas, the question remains whether Prime Minister Manmohan Singh can now trust the fiery Chinese dragon to hold its breath.