By Shelly Zhao
Jun. 10 – China and India have a number of territorial disputes along their roughly 4,000 kilometer-long border. Some of the disputed areas border the Tibet Autonomous Region (TAR) or the Xinjiang Uyghur Autonomous Region (XUAR) and are geographically significant, with Tibetan refugees and the Tibetan government-in-exile (Central Tibetan Administration) in the neighboring Himachal Pradesh state. This article discusses how the main territorial disputes have challenged Sino-Indian relations, particularly in the context of both China and India’s rise, and examines a case study of the Asian Development Bank’s loans and Arunachal Pradesh. This is a follow-up piece to our article on China Briefing last week titled “China’s Territorial Disputes in the South China Sea and East China Sea.”
Sino-Indian relations and territorial issues
With India’s independence in 1947 and the People’s Republic of China established in 1949, both countries needed to reassess their roles, especially in the Cold War system, and saw a redefining of relations. After establishing diplomatic relations in 1950, a central component of border relations was Tibet. China and India signed the Five Principles of Peaceful Coexistence/Panscheel Agreement in 1954, which lasted for eight years. Minor clashes occurred from the mid-1950s, and in 1959, Tibetan refugees settled in Himachal Pradesh to the north of India (south of Jammu and Kashmir), and China found this an encroachment of territory.
Conflicts culminated in the 1962 border war that changed the political landscape – China taking control of much of the disputed territories to the west, and India gaining control of the Arunachal Pradesh region to the east. Sino-Indian relations deteriorated further in the 1960s and 1970s with China supporting Pakistan in the 1965 Indo-Pakistani War; India signing a Treaty of Peace, Friendship, and Cooperation with the Soviet Union in 1971; and skirmishes occurring between China and India in 1967 (Chola Incident) in Sikkim and 1987 in Arunachal Pradesh.
Bilateral relations have improved since the 1980s, with eight rounds of border negotiations occurring between 1981 and 1987 (though without concrete agreements achieved) and dialogue through the Indian-Chinese Joint Working Group on the Border Issue between 1988 and 1993, and a border agreement signed in 1993. In recent years, however, the disputes continue to affect bilateral relations and seem far from resolution. Below, the following tables summarize the major disputed territories, divided into the western and eastern areas.
Jammu and Kashmir
The Jammu and Kashmir dispute is predominantly an Indo-Pakistani conflict that has seen open conflict over the decades. The issue has affected Sino-Indian relations and Sino-Indian-Pakistani relations, and China has supported Pakistan’s claims. India reportedly declared Jammu and Kashmir as well as Arunachal Pradesh to be within its “core” interests in December 2010 during Chinese Premier Wen Jiabao’s visit to India.
The two main disputes are Aksai Chin and Arunachal Pradesh. In the western disputed territorial area, India considers Aksai Chin and the Trans-Karakoram Tract part of its Jammu and Kashmir state, while China considers it part of its Tibetan plateau. The area does not have significant inhabitants or economic resources, but the China National Highway 219 is a major throughway that connects the TAR and XUAR, and road construction was one of the main triggers in the 1962 border war.
Up until 1972, the eastern areas had been the North-East Frontier Agency (NEFA), following 1972 being the Union Territory of Arunachal Pradesh. After the 1962 Sino-Indian Border Conflict, India retained control of Arunachal Pradesh, though China has continued to claim Arunachal Pradesh as South Tibet and part of Tibet. The region is significant due to its closeness to Tibet as well as its agricultural resources (See further analysis from 2point6billion.com).
Case study: Arunachal Pradesh and ADB loans
The case of the Asian Development Bank’s proposed loans to India (including the Arunachal Pradesh region) is an interesting study of China pursuing interests in a multilateral institution. The ADB was created in 1966 to promote economic and social development in Asian and Pacific countries through giving low-interest loans, technical assistance, grants, and policy dialogue. The United States and Japan are the two largest shareholders, both with 14.2 percent (figures as of May 2010). China has 5.9 percent and is the third largest overall shareholder (along with Pakistan), while India has 5.8 percent.
In June 2009, China sought to block a multilateral development loan-funding plan to India. This US$2.9 billion lending plan spanning three years (2009-2012) included US$60 million worth of watershed development projects (including flood management, water supply, and sanitation) in the Arunachal Pradesh region. China asked the ADB to remove Arunachal Pradesh from the loan plan, since for China this implied that the ADB endorsed India’s territorial claim. According to Qin Gang, a Chinese Foreign Ministry spokesperson, China expressed “strong dissatisfaction” over the matter to the ADB, saying that the ADB’s actions “not only seriously tarnish its own name, but also undermines the interests of its members.” In India, tensions rose after China voiced disapproval, with the governor of Arunachal Pradesh announcing that the Indian military was deploying extra troops and fighter jets to the area.
China was able to force a postponement of the board meeting on the issue. The ADB board later overruled China’s objection and approved the loan, made possible because the United States, Japan, and South Korea had large voting shares in the ADB, and voted in India’s favor. The Indian Express newspaper called this a “major diplomatic victory” for India. In the end, however, India decided to drop the projects in Arunachal Pradesh from its list of projects to be funded by the ADB in 2010. The ADB had approved about US$2 billion in loans for 2009, but India chose to seek only US$1.6 billion loans, which was 40 percent less lending from the previous amount.
News sources such as The New York Times remarked that it was the first time that China tried to influence the territorial dispute through a multilateral institution. States pursing national interests through multilateral institutions is not a new concept, and in this case, the Arunachal Pradesh region had long been historically sensitive in Sino-Indian relations. China had generally objected to India asserting itself in the region, such as protesting visits to the region by the Dalai Lama and Indian Prime Minister Manmohan Singh. In this sense, the Chinese objection was to be expected. Much like the territorial disputes in the South China Sea and East China Sea, China has regarded encroachments on its claimed sovereignty to be unacceptable.
What is of interest is that the dynamics between Chinese domestic concerns can spill over into the international arena through multilateral institutions. For regional observers, this can be disconcerting, pointing to the seemingly less benevolent features of a rising China. As China gains more global influence, there is concern of China gaining future voting power – and therefore, influence – in institutions like the ADB. These issues can cause multilateral tensions as well as erode the institutional credibility of the ADB.
A crucial question will be how the countries fare in the new situation in relation to China’s rise. In August 2010, the U.S. Pentagon expressed concern over China’s intentions and pointed deterrence measures needed in the region (see further analysis from 2point6billion.com). It is probable that some degree of institutional balancing in the future will be present. Sujit Dutta has said in The Washington Quarterly (2011) that India pursues a three-pronged China policy of “engagement, balancing, and support for a stable Asian security environment.” Desire for geopolitical leverage and mutual wariness may incentivize China’s desire to protect its interests through multilateral mechanisms.
The other side of the “Chindia” coin is that China and India have many cooperation-impeding issues, including territory. The rise of the two countries remain “unconnected” and lack people-to-people engagement, say David M. Malone and Rohan Mukherjee in Survival (2010). Jonathan Holslag (2009) has also pointed to a persistent security dilemma in Sino-Indian relations, “a vehement race for regional influence, both for geopolitical and economic purposes.” Furthermore, political, historical and cultural, and economic differences make the “Chindia” tag perhaps convenient, yet arguably reductive.
Sino-Indian territorial disputes will no doubt remain a sizeable security impediment to the bilateral relationship, and concerns of Tibet and Indo-U.S. relations can complicate matters. During his visit to New Delhi in December 2010, Premier Wen Jiabao said on the territorial issues, “It will not be easy to completely resolve this question. It requires patience and will take a fairly long period of time.” As the Arunachal Pradesh ADB case has showed, territorial disagreements can become entangled with multilateral and development issues as well. China and India have seen increased convergence in the 21st Century. Nonetheless, the territorial disputes sandwiched between both countries remain hindrances that reflect strategic incongruities, and working toward border resolution and demarcation will be fundamental for deepening future bilateral relations.