Over the past few years, India’s prime minister Narendra Modi has assiduously courted China’s President Xi Jinping, setting aside a long-simmering boundary dispute to pursue deeper economic ties. Chinese companies — including Alibaba, Tencent, and Huawei — have gained a strong foothold in India’s burgeoning market.
But following a vicious brawl in the Himalayan mountains that killed at least 20 Indian soldiers on the remote Sino-Indian border this week, senior Indian government officials say New Delhi will steadily pare back its economic ties with China.
India will look instead to strengthen other strategic relationships — notably with the US — as the dispute along the undemarcated 3,488-km border once again takes centre stage.
“In terms of geopolitical choices, economic choices, India will look elsewhere,” said the official. “We tried to offer them an economic stake in our country hoping that a more robust business relationship could create mutual familiarity and understanding. But obviously beyond a point, it hasn’t worked.”
Though New Delhi and Beijing are seeking to prevent further escalation, the first fatal clashes between the nuclear-armed neighbours since 1975 have shocked India’s political and security establishment, leading many to believe the status quo is untenable.
“This is a turning point — a very serious junction in the relationship,” said Nirupama Rao, India’s former foreign secretary and its former ambassador to the US and China. “With what happened in Galwan [Valley, on the border] — and so much blood being shed — it can’t be business as usual.”
Mr Modi has few easy options to manage the most serious crisis with its more affluent, powerful neighbour since the 1960s, when China briefly invaded deep into Indian territory before withdrawing.
Narendra Modi and Xi Jinping shake hands at a summit in 2017. Until now, New Delhi has been wary of being perceived as too close to Washington lest it provoke China © Kenzaburo Fukuhara/Reuters
Tensions on the border surged after India’s military cancelled its annual Himalayan border exercises in April because of coronavirus. Indian security analysts say Chinese troops used the opportunity to establish positions in terrain claimed by its neighbour, including strategic peaks of the Galwan Valley, overlooking a newly built Indian road.
Once discovered, the Chinese encroachments led to heavy militarisation on both sides, several non-lethal skirmishes, and — following intensive talks between military commanders — a June 6 agreement for a gradual disengagement. However, each side claims the other has violated the terms.
What is undisputed is that a violent brawl — involving fistfights and improvised weapons, like makeshift batons wrapped in barbed wire — broke out on a mountain trail on the night of June 15, more than 14,000ft above sea level, during which some men fell to their deaths.
“There was a clash, and it was brutal,” the Indian official said. “It would be ridiculous to expect there would not be economic or other consequences.”
New Delhi will now cancel several pending public works contracts with Chinese groups, while state-owned telecoms company BSNL has been told to find non-Chinese alternatives for its planned network upgrade, the official said.
Indian intelligence has also proposed a ban or tighter regulation of 52 Chinese apps, including the popular social video platform TikTok. Indian tech start-ups that have benefited from strong Chinese venture capital inflows — including $1.4bn invested in the last quarter of 2019 — could also be caught in the crossfire.
India is a smaller strategic concern for China, which has an economy five times larger and the military power to match. But experts do not believe Mr Xi wants a border war, especially in the context of China’s fraught relations with Washington.
Beijing used harsh rhetoric against New Delhi this week, but analysts say it has refrained from publishing its casualty figures so as not to inflame nationalist sentiment in China.
“China wants to keep things under control rather than escalate the conflict,” said Wang Dehua, a south Asia specialist at the Shanghai Institute for International Studies. “A conflict between two giants will hurt both giants.”
Many Chinese people are convinced their troops decisively “won” the encounter.
“Most of the posts in my WeChat feed are very nationalistic,” said one Chinese professional, referring to the messaging app. “The attitude is ‘We’re far superior to India and what happened on Monday proved it’.”
In Washington, analysts believe the deadly confrontation will accelerate New Delhi’s long-term strategic tilt towards the US. President Donald Trump has made little secret of his hostility towards China and desire for stronger ties with India.
“Regardless of who started this, China may have just delivered India to the US for the next several decades,” said Evan Medeiros, Asia director at the White House during the Obama administration. “Even a deeply nonaligned country like India will find it hard not to seek partners to balance Chinese military power after this event.”
New Delhi may also deepen its involvement in “the Quad” — an informal, nascent grouping of the US, Australia, Japan and India focused on strategic pushback on China.
Until now, New Delhi had been wary of being perceived as too close to Washington lest it provoke China. But such reservations — viewed by some as excessive deference to Beijing’s sensibilities — are likely to dissipate, Indian officials and analysts said.
“India needs to make some decisions about who its friends are,” said Alyssa Ayres, author of Our Time Has Come, a book about India’s international relations.
“India’s foreign policy orientation has always been to try to delay making any choices. Modi talks about ‘the world as one family’. But it turns out, some members of your family aren’t so great to you.”
Additional reporting by Stephanie Findlay in New Delhi