India-China relations: A push to pragmatic partnership?

New Delhi: In recent times first feeler from the top level came during the BRICS Summit Kazan, Russia October 23, 2024 when two heads of the government- Chinese President Xi Jinping and India Prime Minister Narendra Modi met on the sidelines. 

Modi sent a strong message- “It should be our priority to maintain peace and tranquility on the border. Mutual trust, mutual respect and mutual sensitivity should be the basis of our relationship.” 

Meanwhile, there was tension as several high-level talks at various levels were not yielding the desired results. 

It is widely admitted that the US President Donald Trump traumatic treatment with regard to imposition of 50 per cent tariff on Indian exports and 25 per cent extra penalty on purchase of Russian oil prompted India to reset its both economic and strategic relations with China. 

Though the Indian government denies the US’s recent move for India asking better bilateral relations with China with whom are several pending issues including boarder tussle continue to dominate the atmosphere of mistrust. 

Now, all eyes are on Shanghai Cooperation Organisation (SCO) Summit in Tianjin (August 31–September 1, 2025), when Indian Prime Minister Narendra Modi and Chinese President Xi Jinping will meet again.

Now, the question is where they will only shake hands and make ceremonial speeches or they would recalibrate their relationship in a manner that balances economic pragmatism with strategic caution.

It is also a fact that the two Asian economic powerhouses are still locked in a paradox. First of all, political mistrust deepened after the 2020 Galwan clashes. Secondly, trade between them touched record levels in 2024, with India’s dependence on Chinese imports in critical sectors like electronics, pharmaceuticals, rare earth minerals, fertilizers, and renewable energy showing little sign of abating. So, changes in policy and approach require lot of works from both sides. 

In terms of trade and commerce, for India, border tranquillity is the foundation for trade expansion. Without it, even the most ambitious economic projects remain politically vulnerable. 

Notwithstanding mistrust, the economic relationship continues to flourish. India imported nearly USD 100 billion worth of goods from China in 2024, making Beijing its largest source of critical raw materials. 

Indian pharma, mobile phone assembly, and green technology sectors rely heavily on Chinese inputs. Conversely, Chinese companies view India’s vast consumer market as indispensable at a time when Western markets tighten scrutiny.

Hence, at the Tianjin summit and beyond, resumption of border trade through routes like Nathu La, Lipulekh, and Shipki La is a strong possibility along with resumption of direct flights, suspended since the pandemic, to encourage business-to-business links. 

Another area of improvement includes balanced trade practices, with stronger checks against dumping and a push for greater Indian access to Chinese markets. 

India is expected to make it clear that technology partnerships in areas like electric vehicles, renewable energy, and digital commerce can be done, but with safeguards for data and cyber security. 

It can safely be assumed that India’s policy would be guided by trade pragmatism which is not all new. Experts are of the view that India’s strategy now is to leverage trade without conceding strategic space.

It is also well-known that Washington has put tremendous pressure on both China and India. Notwithstanding India’s positive engagement with the US through the Quad and bilateral diplomacy, the country was hit by additional tariffs on Russian oil purchases, ironically harsher than those faced by China. Many experts argue that this creates scope for tactical convergence with Beijing in opposing unilateral economic coercion.

Hence, going forward India and China will continue to cooperate selectively in multilateral forums. Within SCO, India supports regional connectivity but insists on security guarantees. 

At BRICS, India will host the 2026 Summit with China’s support. Both countries also coordinate on Global South agendas at the UN.

Strategically speaking from geopolitics point of view a closer tie with Beijing could complicate US attempts to isolate China, but deep-rooted mistrust over terrorism, border disputes, and China’s ties with Pakistan ensures that cooperation will remain limited, transactional, and issue-based. But, in terms bilateral trade partnership will be guided by only pragmatism.

Finally, the question is what future awaits India-China relation? It is a strong possibility to get some hints, if not a proper answer to this during SCO Summit 2025. With all possibility, hints and answers should reflect economic pragmatism in the face of global trade uncertainties and the need to manage border tensions without escalation.

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