Sino-Indian economic cooperation most effective way to promote mutual trust

By Hu Weijia Source:Global Times Published: 2017/2/16 0:08:40

China has a relatively low industrial complementarity with India compared with other South Asian countries, resulting in intense competition in the global market for products made in the two nations, according to a recent report published by a Chinese government think tank. As more economic competition is expected, greater uncertainty is likely to be present in future Sino-Indian relations.

The report from the Chinese Academy of Social Sciences (CASS) tends to challenge the idea that key elements for Sino-Indian ties are more complementary than competitive in economics and trade.

The idea that China and India are highly complementary should be abandoned in order to restore trust and promote economic cooperation. The competitive trend underlined in the CASS report is expected to become more visible in the coming years as India pursues its Make in India strategy, which calls for a rethinking of bilateral economic ties.

India has become the second-largest source of trade remedy probes against Chinese goods as an increasing homogeneity in the two countries' economic structures creates friction. Additionally, the two countries are also engaged in a fierce competition in exploiting overseas markets in the South Asian region.

How mutual trust can be built and how sound interaction can be developed between the two countries deserve careful consideration and thought.

Although it is not easy to put China and India out of contention in the economic and trade area, dissolving strategic mistrust between the two countries may be more difficult to do. As bilateral ties between the two emerging Asian powers grow increasingly complicated, economic complementarity should be enhanced by encouraging Chinese firms to invest more in India's infrastructure. Shoring up cooperation is the most effective way to promote mutual trust.

The first India-China strategic dialogue is expected to be held next week in Beijing. This would serve as a prime opportunity for the two countries to make a change in its diplomatic strategy. As competition grows the function of economic ties as a buffer to alleviate trade friction between the countries is weakened, which requires the two neighbors to deal with a complicated political situation more carefully. Sino-Indian relations are experiencing severe tests after a female "parliamentary" delegation from Taiwan paid a visit to India. Such issues should be handled much more carefully in the future. 

The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn



 



Posted in: EYE ON THE ECONOMY

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