India will benefit from cooperation not by turning away from its neighbor

This is an editorial from China Daily.

In his meeting with President Xi Jinping on the sidelines of the BRICS Summit held in Kazan, Russia, on Oct 23, Indian Prime Minister Narendra Modi noted that maintaining the steady growth of India-China relations was critical for the two countries and peoples. It not only concerned the well-being and future of 2.8 billion people, but also carried great significance for peace and stability in the region and even the world at large. Against a complex international landscape, cooperation between India and China, two engines of economic growth, could help drive the global economic recovery and promote multipolarity in the world, he said.

But the two most populous countries have disputes over border issues, and despite repeated talks and agreements to ease tensions, it seems there is still a long way to go before the two countries and two peoples develop enough mutual trust for cooperation in a wider range of areas.

In his meeting with Modi, President Xi pointed to the need for both countries to maintain a sound strategic perception of each other, and work together to find the right and bright path for big, neighboring countries to develop side by side.

Despite the fact that China has emerged as the largest trading partner of India with $118.4 billion two-way trade in 2023-24, slightly edging past the United States, there have been reports in recent years about how the Indian government has adopted policies that have made it very hard for Chinese companies to operate in India.

In his meeting with Modi, President Xi said that development is now the biggest shared goal of China and India. Xi said that the two sides should continue to uphold their important understandings, including that China and India are a development opportunity for each other rather than a threat, and a cooperation partner rather than a competitor.

Yet the Indian government has been reluctant to share that view, having sought to cash in on the China Plus One supply chain strategy of some developed economies whereby companies seek alternatives to Chinese manufacturing. India is the only country with a labor force and market size comparable to China, and it offers comparable cost-savings to China. However, as reported by The New Indian Express, the Indian government think tank NITI Aayog admitted in its latest quarterly report that India has seen limited success so far in capturing the China Plus One strategy in comparison with Southeast Asian countries such as Vietnam, Thailand, Cambodia, and Malaysia, which the report said have become bigger beneficiaries of the strategy due to factors such as cheaper labor, simplified tax laws, lower tariffs and proactiveness in signing free trade agreements.

Despite this "de-risking" strategy, China remains the global manufacturing powerhouse, and it has the most complete supply and industry chains. The report fails to talk about how India could benefit by cooperating with China in as wide a range of areas as possible, as the Indian and Chinese economies are complementary to each other in many ways.

If India looks at how it can strengthen cooperation with its neighbor to promote the economic development of both countries, there will be indeed a lot of opportunities and potential for bilateral cooperation in a wide range of areas.

China has drawn up a grand blueprint for further comprehensively deepening reform and advancing Chinese modernization. It is determined to promote high-quality development and high-standard opening-up from which other economies can benefit.

India needs to change its perception of China, not only that of its government but also the Indian people. It is important for India to recognize that China is not a threat to it, and that the disputes over border issues should be settled through talks.

Since the beginning of this year, China-India relations have enjoyed the momentum of improvement and development thanks to the high-level communication they have maintained. It is hoped that the two largest developing countries will continue to build mutual trust, on the basis of which New Delhi will make things easier for Chinese enterprises to invest and operate in India, and promote the expansion of bilateral cooperation.