From the historical and economic point of view, it is certain the standoff between China and India is not a day-old matter. It is developed by years of strategic and geopolitical phenomena. The Socio-political turmoil of these two states is so deep that the heat of the conflict can be seen among common citizens of these states. But surprisingly the trading environment between India and China is at a different level. Despite their political coldness trade and economy has a stronger association and understanding. This epic tale of these two great nations articulates the ever-green forbidden love. It is like the first love we can never get. Where it is difficult to be together but silently keeping track of one another.
On June 15, in Patrol Point 14 in the Galwan Valley of eastern Ladakh, the Indian and the Chinese Army got into a clash. After the 2017 Doklam Crisis, this is the major faceoff between these two. Both are flexing muscles in the military domain but the reality is somewhere else.
Like today’s world, the ancient world was connected too, perhaps not by super-fast 5G networks or bullet trains but they had something which not only connected the world but also built civilizations. They were the trade routes. Among the ancient trade routes, “Silk Roads” were the most influential ones. These trade routes connected the East and West. In this network, there was the great Persian civilization, Northern Africa, Southern Europe, and both China and India (Frankopan, 2015). Today’s central Asia is the result of these routes. In modern days Kazakhstan and Uzbekistan some great artifacts still echo the contribution of the Silk Roads. Now the question comes as to why it is called the Silk road? The answer is Chinese silk. Silk was one of the major goods which were traded from China to the fertile crescent. It was the symbol of political and social power. The chanyu (the then tribal leaders) used to wear silk and used it as a reward (Frankopan, 2015). In periods silk become so powerful it became an international currency and with Silk China grew stronger. The roads carried Chinese silk to Europe and the Mediterranean, pottery from France was sold in Persia, and Spices and condiments of India were used in Xinjiang. Oxford historian and scholar Peter Frankopan’s commented in his book The Silk Roads- “This was a World that was connected, complex and hungry for exchange”. However, China made the best out of these roads. When the roads lined the steeps into an interlocked network China’s expansion ambition skyrocketed. Their ambition lay beyond the Gansu corridor, a route 600 miles long linking the Chinese interior with the oasis city of Dunhuang, a crossroad on the edge of the Taklamakan desert. This expansion of China’s horizon linked Asia together. (Frankopan, 2015)
In modern times, China wants to revive its old glory of the Silk Roads. So, in 2013 China came with the most ambitious economic plan of the century. The Belt and Road Initiative (BRI); this initiative promises it will connect Asia, Africa, Europe, and South-East Asia via land and maritime trade routes. The plan is to connect 70 countries together. (Xinhua, 7 September 2013 ) And with a vision of completion by 2049 China is extremely serious about it. China has also committed 900 billion to 1 trillion US dollars for infrastructure development. Most of the participants state are looking forward to it (Frankopan, 2018). Only but one. China’s old friend India. India boycotted the first Belt and Road Forum (BRF) in 2013 and the second one in 2017, citing its concern over the China-Pakistan Economic Corridor (CPEC) project, China’s flagship BRI project in Pakistan. India cited issues of “sovereignty” and “territorial integrity” as the roots of its concerns. Because the CPEC project passes through Indian-claimed but Pakistan-administered portions of Kashmir. (Islam, Ailian, & Jie, 2018)
However, India had something else in mind all along. To cut the fine Silk it was rosining up its desi cotton. To counter the Belt Road initiative or the modern Silk Road, in 2015 in a conference named the Indian Ocean: Renewing the Maritime Trade and Civilizational Linkage in Bhubaneswar, India presented its ambitions for the new Cotton route. The location of the conference was also very symbolic. Because the finest quality of Cotton was found in the greater Bengal and the coastlines of the Bay of Bengal. Like the Silk Roads, the Cotton route also has its glorious past. Cotton was first exported from India during the 1st century CE.
The coastal area-based Indian traders were regular suppliers of Cotton. Archaeological discoveries at Myos Hormos and Berenike ports of the Red Sea indicate cotton was exported to Central Asia via the ancient Silk Roads. Cotton was one of the major products of ancient trade and that cotton was supplied via a maritime trade route that connected India with Egypt and all the way to Mexico. Because of high demand cotton turned into a highly sought commercial good. So, to fight fire with fire India decide to revive their route with some modifications. The first step was involving Russia with the cause. Secondly, connecting the southern reaches of the continent via road and rail infrastructure. Bringing Africa close and allow inter-change. In the South Indian Ocean, a strong point of the Cotton route is incorporating island states, the route will also work as a safeguard against china in the western Indian Sea. Finally, the Cotton route will be the gateway to ASEAN. Fun fact: why India is silent in the Rohingya crisis? Well, Cotton Route will create an ASEAN highway through Myanmar.
China is the largest trading partner of all its neighbors also the biggest investor. Being the biggest defense logistic provider with BRI, the presence of China in South-Asia is quite notable (Ramasamy, Yeung, Utoktham, & Duval, 2017). In the race of winning neighbors’ hearts, India does have some plans. It is directly linked with energy and agro-trading with Bangladesh. Have notable investment in Myanmar, Bhutan is heavily dependent on trade and communication in India. And India is also trying to work closely with Afghanistan to connect Russia and Iran with the Cotton route. In May 2016 a pact was signed by India, Iran, and Afghanistan for the establishment of a “transit and transport corridor” with Chabahar as a regional hub for maritime cargo. However, things turned South for India after the abolition of article number 370 and the Citizenship Amendment Bill. And recently Nepal became an issue regarding Kalapani.
When India is dealing with a kind of silent treatment from most of its neighbors, Bangladesh became more important. In this love and hate, the Bangladesh government is showing very good diplomatic skills by keeping both doors open. As a result, Bangladesh got the proposal to be the trial ground of Chinese company Sinovac’s vaccine and will have a preference when the vaccine is ready.
As for China and India’s own trading, in the ground of economy, we all set things aside that is why India almost imported totaled $65.1 billion in fiscal 2020 and exported at $16.6 billion to China which translated into a trade deficit of $48.5 billion. Interestingly, Chinese imports contributed to over 30% of India’s aggregate trade deficit. Over the past 3 decades, India’s exports to China grew at a Compound Annual Growth Rate (CAGR) of 30% but its imports expanded by 47%. Because both understand political transformation and harmony are required for a poor society to become rich. China is one of the countries that made the switch from economic policies that caused poverty and the starvation of millions to those encouraging economic growth (Acemoglu & Robinson, 2012), and the same goes for India. So, even if the situation deescalates dearly there could be trade barriers. But only temporarily. At least these can be said by keeping the Sino-Indo balance of trade in mind.
Finally, it can be said, it is very unlikely we will see another Sino-Indo conventional war. And as for heavy militarization in the border area, it is just like a heavy weight lifting competition that looks furious but has no violence in it. This epic tale of these two great nations articulates the ever-green forbidden love. It is like the first love we can never get. Where it is difficult to be together but silently keeping track of one another.
Reference
Acemoglu, D., & Robinson, J. A. (2012). Why nations fail: The origins of power, prosperity, and poverty: Profile Books.
Frankopan, P. (2015). The silk roads: A new history of the world: Bloomsbury Publishing.
Frankopan, P. (2018). The new silk roads: The present and future of the world: Bloomsbury Publishing.
Islam, M. S., Ailian, H., & Jie, Z. (2018). Major Challenges and Remedies in Building the Bangladesh-China-India-Myanmar Economic Corridor. China Quarterly of International Strategic Studies, 4(04), 613-629.
Ramasamy, B., Yeung, M., Utoktham, C., & Duval, Y. (2017). Trade and trade facilitation along the Belt and Road Initiative corridors. Retrieved from
Xinhua. (7 September 2013 ). Speech By Xi Jinping. Astana
Author: Chowdhury Mujaddid Ahmed is an MBA student in the department of International business. His areas of interest are international trade, political economy, and geopolitics. He was the former President of Dhaka University Model United Nations Association and the 8th Secretary-General of Dhaka University National Model United Nations organized in 2019. He is also the receiver of the Commendation Award for outstanding performance in Oxford University Model United Nations 2017.