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Last Updated: Thursday, 23 November 2006, 12:05 GMT
India and China's new course
Sanjoy Majumder
By Sanjoy Majumder
BBC News, Delhi

Hu Jintao
Mr Hu woos Indian business leaders in Mumbai
Hu Jintao last visited India in 1984.

Twenty-two years later, as the Chinese president renewed ties with his closest Asian rival, he saw an India that had changed considerably.

Politically, India is no longer dominated by a single party but instead is governed by relatively stable if somewhat unruly coalitions.

Economically the country is snapping at China's heels, competing with it for global energy resources to feed its fast-growing economy while also presenting an attractive market for Chinese goods.

So the tone for the visit was set right at the beginning - a gracious formalness befitting two proud and ancient civilisations combined with a brisk, businesslike, if bullish, approach.

Simple message

President Hu's meetings with Indian leaders were flawless - correct, measured and polite but not warm or over-friendly.

The message was stark in its simplicity.

"China is ready to work with India," the president said in a keynote speech delivered to politicians and opinion-makers in Delhi.

Tibetan protester with his clothes on fire
One of the few Tibetan protesters to break through security

Both China and India recognise that they need each other and that they need to work for mutual benefit even while preserving their self-interest.

That is why, even in the midst of a host of economic agreements, both countries also agreed to cooperate in the field of civilian nuclear energy.

It is a contentious area - while China has been suspicious of India's recent deal with the United States which gives it access to civilian nuclear technology, Delhi is unhappy with Beijing's reported plan to extend its nuclear cooperation with Pakistan.

But as India's Foreign Secretary Shiv Shankar Menon says: "Both countries can work together while preserving their self-interest."

So while politically Beijing might be concerned about India's nuclear capabilities, economically it spies business opportunities to help develop nuclear reactors and provide fuel.

China is also a member of the 45-member Nuclear Suppliers Group - a body which needs to ratify the agreement between the United States and India.

"We need China's help, if not active, but passive, to turn the NSG decision in our favour," says Naresh Chandra, a former Indian ambassador in Washington.

Common ground

It's this pragmatism which is pushing decades of mutual suspicion and antagonisms aside in favour of new, robust ties.

So the two countries signed some 13 agreements in a range of areas, from opening new consulates in Guangzhou and Calcutta to one on protecting their investments in each others countries. There was even an agreement on how to jointly preserve their cultural monuments.

Both countries have a lot in common:

  • Their economies are growing rapidly
  • They have large populations

  • Their physical resources are stretched to the limit

But there are, of course, plenty of unresolved issues.

Chinese companies say they are being blocked from investing in some areas such as ports and telecommunications.

While India denies this, it has said it will make it easier for Chinese businessmen to get visas - one long-standing concern.

For its part, Indian industry is wary of being undermined by Chinese manufacturers who have the ability to push cheaper, better produced goods into the Indian market.

Despite this, the overwhelming sense is that the two countries can collaborate rather than compete and as a result, the two leaders have decided to work to double their trade to $40bn by 2010.

"One must realise that it is businesses that compete, not countries," says KK Modi, a leading Indian industrialist and a former head of India's Chamber of Commerce and Industry.

"And increasingly, businesses will work across borders."

Moving on

India and China have a turbulent history.

Chinese and Indian military officials exchange greetings at the Nathu La pass
Both sides have put their bitter past behind them

They fought a border war in 1962 - it led to an overwhelming victory for China and India has lived with the bitter memory since.

While the border issue is still to be resolved, the strategy is clearly to reduce the possibility of political disputes overturning the economic gains.

So while both political differences may occasionally flare up, for the most part it will be business as usual.

Nothing illustrates this better than the way in which India handled protests against President Hu's visit by Tibetan activists.

India has a large number of exiled Tibetans who are allowed to live here but have limited political influence.

During the president's visits to Delhi and Mumbai, the protesters were kept away from the venue of his meetings.

In one instance, a few of them broke through the security cordon in Delhi and in Mumbai a Tibetan protester set himself on fire near the president's hotel before being led away.

From the diplomatic point of view, it was just a brief hiccup in what has been a smooth if unexciting visit.


SEE ALSO
China lauds India-Pakistan peace
22 Nov 06 |  South Asia
India and China 'to double trade'
21 Nov 06 |  South Asia
Tiger economies go head to head
05 Jul 06 |  South Asia
In pictures: India-China trade route
05 Jul 06 |  In Pictures

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