Assessing China’s Rise
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Issue Book Excerpt: China: Threat or Challenge? | Date : 27 Aug , 2017

China has been growing economically, and its armed forces are modernizing at a fast pace. While China has opened up to the rest of the world on the economic front, clarity on its intentions does not exist, resulting in a debate on the nature of relationship, whether benign or assertive, that will evolve as the country achieves its goal of enhanced Comprehensive National Power(CNP). China has stated that it aims at becoming a preeminent regional player in the Asian context by the 2025 scenario and an important global player by 2050.

A lot has been written about the challenge that China as a rising power is likely to pose to the United States as the predominant power at the global levels. It has been said that a rising power will sooner or later impinge into the strategic space long considered as the preserve of the dominant power. Similarly, the rising power is likely to view all acts of the established power as aimed at quashing its growth before it is too late. A similar equation seems to persist in the Sino-Indian context. Both the countries are rising economically and are slated to be moving towards their historical period of pre-eminence with a greater role in the global arena. However, the head start enjoyed by China has placed it way ahead of India in its economic success and consequent military modernization. This coupled with the existing trust deficit has heightened the perception of China as an inimical power aiming to keep India embroiled within the sub-continent. How the two countries manage their internal and external fault lines will to a large degree determine the relationship between the two.

Power Transition Theory

The power transition theory of international relations posits a hierarchical international system with a dominant power at the top and great powers, middle powers and small powers at the subordinate levels. The hierarchy reflects the distribution of power resources and is based on political and economic resource allocation which serves the dominant power. An extension of this theory legislates a multiple hierarchy model wherein, instead of a single power hierarchy, there exist a series of parallel hierarchies. These subsystems function in a similar manner as the overall power hierarchy with a dominant player at the regional level and other regional and sub-regional players. There is also a lot of variation in describing the powers as super, great, middle, regional and sub-regional, etc. Suffice to say that in the current emerging world order; the US occupies the place of the dominant power. It is in the interest of the dominant power to ensure a unipolar international order and a multipolar regional hierarchy. The vice-versa is true of the emerging regional power with global aspirations. It is, therefore, axiomatic that growth of India and China in the Asian context is bound to develop fissures in their dealings.

A great regional power can be defined as:–

  • A state which is geographically a part of the delineated region.
  • A state which can stand up against any coalition of other countries in the region.
  • A state which is highly influential in regional affairs.
  • A state which in addition to being a regional power is also a recognized Active power at the global level.
  • A regional power combines power resources (hard power) with the role definition and perception of the regional power by the other states (soft power). Hence, the regional power must: –
  • (i). Have an articulated claim to leadership.
  • (ii). Have the material, organizational and ideological resources for regional and extra-regional power projection (power over resources).
  • (iii). Undertake activities in sync with the desire to honor the claim of leadership and to mobilize power resources.
  • (iv). Have recognition and acceptance of its leadership status by other actors/states in the region and outside it.
  • (v). Real political influence in the region (power over outcome).

Exploitation of Strategic Period of Opportunity

When analyzing China in response to the above definition, we find that China is well on its way towards achieving its goal of regional supremacy. Moreover, its desire to attain greater prestige in the global arena will force it to structure its policies, vis-a-vis India, to keep India hemmed in. The Chinese have taken stock of the emerging world order and realized that a period of opportunity exists due to engagement of the developed countries in the fight against terrorism and this period of opportunity has been utilized to develop economically without an ideological bias. This economic development has accrued the following benefits: –

  • Assimilation of science and technology.
  • Creation of leverages in the world due to economic dependency and commonality of interests.
  • Provided the resources for military modernization.
  • Provided the resources to aid other countries, thus developing good relations.

The geography of China has endowed it with the locational advantage of being a continental and a maritime power. It has the mineral and hydrocarbon-rich Central Asian countries to its west, the main shipping lanes of the Pacific Ocean to its east, sparsely populated Mongolia and the Russian Far East to its north and the fledgling nations of the ASEAN to the south. China’s actions abroad and the thrust of its foreign policy are governed by its desire to secure energy, and strategic mineral resources to sustain its economic growth and ensure a rise in the standard of living for its population. The focus of Chinese foreign relations could be projected as follows:-

  • Use trade and economy to develop leverages within the neighbourhood. China has already developed leverages within the region by the development of trade and putting in place regional trade and security arrangements (ASEAN, ARF and SCO).
  • China appears to be expanding its control in the immediate neighbourhood by a creeping demographic and corporate control over the region. As is evidenced in the Russian Far East and Mongolia.
  • The impetus on military modernization with priority to naval development to create a disposition of power so favourable that it may not have to use force to secure its interests (Credible Deterrence).
  • Engage with the world in a non-ideological biased environment to secure its national interests. Its engagement with the hydrocarbon and mineral rich nations of Africa, South America and South East Asia is governed by this philosophy.
  • Domination of the South China Sea for securing its energy needs and gradually develop the capability to operate in the Indian Ocean to counter the strategic advantage enjoyed by India. The development of a naval base in Hainan Island and engagement with the IOR littoral as also developing road/rail linkages with Myanmar and Pakistan are indicators of this activity.
  • Improve power projection capabilities to protect its interests abroad. China has always been sensitive to its periphery. Increased economic linkages are liable to result in an increased periphery with the desire to ensure its defence.

China appeared to be following the policy of keeping a low profile while comprehensively developing its national strength through the last four decades. However, there has been a shift from 2009 onwards and a more assertive Chinese behavior as is evident from its actions in the South and East China Seas has been manifest. This increased aggressiveness has been debated by China watchers, and some possible reasons for this strategic shift have been articulated. These range from domestic compulsions of increased nationalism, interest groups driving policy, and a hawkish PLA, to a heightened perception of having arrived as a power to be reckoned with in the international arena. It appears that China’s increased assertiveness is aimed at provisioning a fait accompli through forceful occupation and infrastructure development on islands under occupation.

Sino-Indian Equation

An analysis of history will show that there has never been an instance where two strong nations with extra national ambitions have coexisted with common borders. A historical perspective would indicate such existence only where the borders were insurmountable such as the ocean in the European context and the Himalayas in the Sino-Indian context. With these barriers having been surmounted, conflict more often than not, will remain the guiding force for relations between such nations. Hence in the Sino-Indian context, the conflict will remain, the manifestation of this dispute and the prominence attached to the conflict will vary based on the specific issue and the international and regional environment prevailing. China has rightly assessed that the rise of India will pose challenges to its preeminence within the Asian Continent. It is therefore in its interest to keep India embroiled with its neighbourhood. The existing instability within the sub-continent and the internal situation within India lend themselves to exploitation by an inimical power. It is this realization and the necessity for the security of sea lines of communication (SLOCs) that has resulted in China engaging in a benign and win-win relationship with India’s neighbours.

Sino-Indian relations have been governed by different priorities between the two. While India accords utmost importance to its ties with China, China has only just started paying heed to India, especially so, after the recently increased bonhomie between the US and India. There are a large number of irritants both old and new which inhibit a smooth growth based on mutual trust. From China’s perspective, as long as India understands that China is the preeminent great power in Asia and keeps her place in the hierarchy, both will enjoy a mutually beneficial relation. However, should India aspire to emerge as China’s equal or peer competitor — and that too, with help from the West, then the whole gamut of issues is open for review and recasting.

Chinese realpolitik dealings with the region and the world in its growth trajectory have resulted in heightened sensitivities within the region and amongst the developed countries. The emergence of India as a growing power will impinge on a common strategic space and afford a more benign model for other countries of the region to emulate. Moreover, the desire by the developed world to create leverages vis a vis China will result in a greater acceptability of India as a hedge. Whilst India has so far managed its relations with the developed countries as mutually beneficial, and not aligned with any in an anti China coalition, the existing trust deficit will only heighten the sensitivities of China vis a vis India. China realizes that in its road to development, it needs India to project a united front on some strategic issues in global forums. As a result, it is engaging India in the strategic field (economic, environment, energy, etc.) and confronting India on the tactical front (intrusions, anti-India sentiments in media, extrapolation of claims, contesting Indian inclusion in the United Nations Security Council, and Nuclear Suppliers Group etc.).

Strategy on Mutually Beneficial Issues. While competing for power and influence, the two share common goals of maintaining regional stability, access to markets and capitol, and accruing benefits from the ongoing globalization. Co-operation would give both the benefit of holding their own in the international arena. Hence, despite the trust deficit the two countries continue to cooperate in management of both, their sensitivities and areas of common concern.

  • Peace and Tranquility along the Borders: Despite no visible forward movement in the negotiations on the border dispute, there have been significant gestures, such as the Chinese recognition of Sikkim as a part of India and the resumption of border trade through the Sikkim sectors as also opening the route through Nathu La in Sikkim for the Pilgrimage to Kailash Mansarovar. The above notwithstanding, China continues to articulate its claims in local media and intrusions have taken place regularly.
  • Economic and Technological Cooperation: Trade between the two countries has grown significantly. However, a greater scope exists. The Chinese hardware and Indian software in the IT field is one area where each can contribute to the growth of the other.
  • Cooperation in efforts to control and curb the rise of Islamic fundamentalism which may ferment internal problems for both countries. China has exercised great caution in aligning with Pakistan on internationally unacceptable issues like Kargil, proxy war, terrorism, narcotics trade, etc.
  • Globalisation and the consequent networking between the business classes of the two countries have contributed to a resurgence of economic interest in each other and a dilution of the mutual threat perceptions.

Strategy on Confrontational Issues. Chinese desire to emerge as the sole great power in the regional context has resulted in it taking recourse to steps without any consideration for sensitivities of others. As a result, the already fragile relationship between India and China is held hostage to a host of ongoing and developing issues. These need to be managed effectively to create a conducive atmosphere for further cooperation.

  • Sino-Pak Collusion: China has consistently assisted Pakistan’s nuclear weapons and ballistic missile programmes to counterbalance India’s development of new weapon systems. India’s preoccupation with Pakistan reduces India to the level of a South Asian power while China can claim the status of an Asian power and work towards becoming a World power. The go-ahead to the development of the China-Pakistan Economic Corridor despite Indian sensitivities and the presence of Chinese PLA personnel in the Northern Areas has furthered the alienation between the two.
  • Sino-Indian Border Dispute: It is the longest outstanding border dispute post-World War II. Since 1999, there have been probing actions along the line of actual control, in the form of border incursions by Chinese patrols in a manner designed to test Indian resolve. China has settled border disputes with 12 out of 14 neighbours, but she is unlikely to resolve its dispute with India in the near future. It would aim at negotiating from a position of strength consequent to development of an adequate CNP and creating reasonable power asymmetry with India. In the interim, the unresolved border affords a justifiable cause to put pressure on India through intrusions, etc., this may take the shape of political blackmail wherein while the attention is focused on the point of intrusion; normalcy may be held hostage to concessions elsewhere and on myriad issues.
  • Strategic Encirclement: China’s skilful use of economic and military means to strengthen its relations with Myanmar, Bangladesh, Nepal, and Sri Lanka is a source of concern for India. China’s support for India’s smaller neighbours suggests that it wants to limit Indian power and influence to within the sub-continent.
  • Naval Modernisation: The Chinese Naval modernization is aimed at securing its control over the vulnerable maritime periphery and asserting its right to operate in the Indian Ocean to ensure the security of its oil and trade transiting through the region. In accord with its apprehension with respect to the vulnerable sea Lines, China is proactively engaging with the Indian Ocean littoral to include Cambodia, Myanmar, Bangladesh Sri Lanka and Pakistan (String of Pearls) to protect its long-term economic security interests. This desire is likely to manifest in a clash of interests with India and creation of a maritime dimension to any future conflict.
  • Another sign of limiting India’s influence is China’s opposition to the expansion of the veto-holding permanent membership of the UN Security Council. China remains opposed to having its Asian rivals — India or Japan — sitting in the UN Security Council. Chinese desire is to prevent a regional competitor emerging as a challenge.
  • Energy Security: China and India face growing demand for energy and are locked in fierce competition for stakes in overseas oil and gas fields. China is currently ahead in the competition for stakes in the field of energy, having linked the issue with its core national interests and engaging with supplier countries on a non ideological basis. China has also been more successful in diversifying its energy resources. Despite the conclusion of energy cooperation agreements, energy competition, rather than energy cooperation, will be the norm.
  • Tibetan Issue: China will continue to view India with suspicion regarding covert support to Tibetan cause, although India has been exercising extreme diplomatic caution on the issue.
  • Isolation in Regional Forums: China has been endeavouring to isolate India in regional forums. Seeing India’s “Look East” policy as part of a wider “congage China”(contain and engage China) strategy unveiled by the US-Japan-India grouping, the Chinese endeavours are aimed to keep India confined to within the subcontinent and on the periphery of any regional grouping involving South East Asia.
  • Besides being an economic competitor for regional resources and foreign investment, India’s growing economic and nuclear status and pro-Indian tilt of US post 9/11 is a cause of concern for China and hence the impetus towards engaging India on various issues. China will endeavour to engage with India to prevent its tilt from an independent policy towards a US-centric China containment policy.

Challenge Ahead

In essence, China in its efforts to develop recognition as a regional power has taken recourse to realpolitik in her foreign relations. When confronted with similar aspirations by India, the two are bound to face each other on a host of issues. Some areas where mistrust and competition are going to evolve are: –

  • Competition over same strategic space.
  • Chinese desire to preserve control over an enhanced periphery.
  • The strategic encirclement of India.
  • Strategic partnership and alliances.
  • The desire to maintain Status Quo by China as the dominant power in the Asian context.

The rise of China and India to global prominence is ultimately about power. Power to hold their own in the regional and/or global context. According to Joseph S. Nye, Jr, “Power is conveyed through resources, whether tangible or intangible. People notice resources. However, power resources that win in one game may not help in another. Power conversion —– getting from resources to outcomes —- is crucial. This requires well-defined strategies and skillful leadership.”

China with its head start over India in the economic development has been able to comprehensively develop its resources and is looking towards creating a strategic configuration where it can through a judicious mix of its hard and soft power develop an environment conducive to the acceptance of a leadership role by China at the regional and global levels. In doing so, it is creating apprehensions in the minds of countries regionally and globally. This, in turn, has increased the acceptability of India as a regional balancer. If judiciously utilized, this opportunity provided space for India to leverage its hard and soft power resources. Our ‘Act East’ policy, closer ties with the United States, Japan, and Australia are steps in the right direction.

China a Threat or a Challenge

Whether China is viewed as a threat or a challenge will directly depend on the Indian perceptions of China. Perceptions are to a great extent shaped by the resource availability for mitigation of emerging adverse environment. Despite the current bonhomie between the two, lingering suspicion and distrust remain. The coming years will testify if the goodwill and momentum generated over the last few decades can be maintained. The increased disparity in economic growth and comprehensive development of CNP in favour of China is liable to manifest in a more aggressive China aiming at impeding Indian growth to preserve the Status Quo. It is imperative that India continues to lay impetus to its economic development and concurrently accord priority to its military modernization to address the existing vulnerabilities vis a vis China.

When viewed as a threat, India will accord due priority to the modernization of its armed forces, thereby creating deterrence capability vis a vis China. However, in the regional and global maneuvering, whether for markets, resources, trade, or influence in general, China is and must be looked at as a challenge. Development of our resources to offset inadequacies will give us the strength to hold our own, while simultaneously, increasing our hard and soft power resources, making us a country difficult to ignore in all regional and global issues. Our emergence as a nation of consequence will depend on the perception of the comity of nations as to our arrival on the world scene.

Strategic Engagement

India must follow a policy of ‘constructive engagement’ with respect to China as part of furtherance of our political and economic interests. In doing so, we needn’t surrender our vital interests. Engaging China from a position of strength and as equals should be the driver of our political and diplomatic policy.

Deepen Trade Ties. Since trade and investment can improve a durable network of interests, it must be further broadened and intensified. India’s trade with China is expected to touch $ 100 billion this year. However, given the size of both economies, the level of economic interdependence remains low. While leaders in both countries have highlighted the complementarities of their core industries, India’s software, and China’s hardware, they have yet to make significant investments in each other’s economy. The necessity to promote and expand greater economic contacts and manage competition for markets, investment and technology imports would require entrepreneurial acumen and astute leadership in both countries so that their projected growth could generate a win-win situation for both.

Collaboration in Multilateral Forums. Beijing is wary of New Delhi’s eastward strategy of developing greater economic ties with Japan and the Association of Southeast Asian Nations (ASEAN). China feels that India’s Southeast Asian diplomacy could add complexity to China-ASEAN relations. India must employ all its diplomatic expertise in an endeavour to allay these Chinese apprehensions. India and China also have increasingly shared and overlapping interests in WTO. Our collaboration with various multilateral institutions could make a strong impact. A small, but effective step in this direction has already been made. If we act in concert, it will enhance cooperation in other fields too.

Educational and Cultural Exchanges. There could be a sustained exchange of ideas between academic and professional bodies. Through these bilateral exchanges, an atmosphere conducive to generating greater contacts and understanding can be built. An affiliation between various universities and institutes on both sides could also play a vital role

Balance of Power

India’s close relationship with Russia, Central Asian Republics, Vietnam and other Asian countries should be strengthened. Such an action may be viewed adversely by China but is essential as a counterbalance to Chinese hegemonic aspirations on its periphery.

Sub-Regional Cooperation. Strengthening and actively participating in regional groups like SAARC, ASEAN, BIMSTEC and other such forums will not only counter the Chinese influence but also help contain it.

Relations with Neighbours. India must consciously build bridges with her neighbours to minimize the anti-India feelings and apprehensions and reduce Chinese influence. At the same time, active bilateral engagement with India’s neighbours should remain the cornerstone of our foreign policy.

Strategic Response

Border Dispute. Without a satisfactory resolution of the border dispute, there can never be a complete normalization of bilateral relations. Despite several rounds of border talks, a solution remains elusive due to fundamental differences over the mechanism of the settlement. The heightened nationalistic fervor with respect to the boundary question in both countries will necessitate firm resolution, and an ability to sell the terms arrived at to the people of the countries.

Infrastructure Development. China ‘s rapid infrastructure development in Tibet has not been matched with a commensurate developmental effort on the Indian side of the border. For any negotiated settlement at a later stage, India should endeavour to confront China from an equal position, if not from a position of strength.

Nuclear Deterrence. India suffers from a severe disadvantage of geography in relation to China. While China can strike any part of India from occupied Tibet, India would need to develop deep penetration IRBMs to strike at the Chinese mainland targets. Nuclear weapons are best deterred by nuclear weapons and as a logical corollary, only missiles can deter missiles. Hence, India must develop, test and induct the IRBMs and develop ICBMs as a credible deterrence against China.

Energy Feud. China is the world’s largest consumer of oil and natural gas; India is catching up fast. The two countries are seeking to work together for the common cause of meeting their energy needs in the most cost-effective manner. However, securing energy needs will remain a source of confrontation and thus a concern. India needs to engage with the energy donor nations in a pragmatic and unbiased manner, developing incentives and leverages to ensure a regular supply of its energy needs.

Defence Budget. China’s defence spending has increased by 10-12% annually.[1] The budget is likely to go up by an additional 7 – 8% this year bringing it to 980bn yuans ($150bn).[2] China’s real military spending could be much higher. The gap in the capability of the conventional forces between India and China is widening in China’s favor. Hence, China may be even less inclined to accept Indian perceptions of the border. To rectify this imbalance, India needs to ensure the development of adequate military capability against China. A commensurate increase in the Indian Defence Budget and sustaining it at that level for the next 10-15 years may be the only answer. Along with giving due impetus to ‘Make in India’ initiative.

Maritime Interests. India must maintain a strong maritime capability to defend its island territories, safeguard national interests in the Exclusive Economic Zone (EEZ) and secure energy corridors. Development of joint military capability for various out of area contingencies is also essential.

Armed Forces. In today’s globalized environment, military modernization with imperialistic designs is a thing of the past. However, an economically powerful nation with a weak military muscle is unlikely to be able to hold its own in the international forum. It is essential that the economic development is paced with a simultaneous growth in military modernization with a view not only of increasing international clout but also as a deterrence against misadventures by neighbours. Deterrence being a matter of perception, the onus of acceptance of military influence rests with the adversary and therefore, it would be incorrect to lay a datum to deterrence capability. Modernization of the armed forces, therefore, needs to be an ongoing process and keep pace with contemporary capabilities being developed the world over.


Foreign policy must aim at using the tangible resources (Military might, economic strength) towards the creation of intangible resources (prestige, leverages, dependencies). These, in turn, lend themselves towards the creation of perception among target states of the comparative superiority of the emerging power. China appears to be moving in this direction. Its assertiveness in the South and East China sea, Creation of the Asian Infrastructure and Investment Bank, and the Belt and Road Initiative, while enabling it to rebalance its economic priorities is also about enhancing the perception of growth with China as, against, a growth at the cost of China. According to Nye, there are three aspects of relational power, the first is commanding power (better understood as the use of carrot or stick), the second is the controlling of agendas, and the third is the establishment of preferences. Of these, the second and third are relatively more important. Chinese actions in the regional and global arena seem to be moving towards the creation of an environment wherein it may set agendas and create preferences in countries thereby ensuring their willing support to China.

Buy Now: This book is sequel to “Threat from China”.

However, China has not been able to allay fears of an aggressive and powerful nation shaping the regional environment in its favour at the cost of individual countries. This has resulted in a greater acceptability of India as a hedge against China not only by the regional nations but also in the international community of nations. We must continue to cash on this immense leverage in our favour and try to develop a commonality of interests not necessarily at the cost of exclusion of China. We must, while continuing to reduce our vulnerabilities, create a narrative to guide the region. One such narrative could be ‘Preservation of the Commons (economic development, social well-being, territorial integrity, cultural security) from the Commons (terrorism, piracy, natural disasters, increased criminality, the safety of maritime routes, etc.),. Positive engagement with all stakeholders including China will then be the imperative.

The retention of power by the CCP is to a great extent directly related to the continued economic development within China. The CCP will, therefore, accept the current Westphalian World Order, but in its charted course of growth will frequently be averse to the dictates of the institutional framework of the existing world order. China is still an emerging power with inherent fault lines such as urbanization, the divide between the east and the rest, a slowing economy, a chronic dependence on imported raw materials, a gaping urban – rural, rich – poor divide and a worsening threat from violent ethnic minority unrest. Also, there are a number of organizational challenges such as corruption, the inadequacy of state-owned enterprises, rising demands for imports by an evolving middle class, a constant power game within the CCP.

China has managed these challenges well so far. A course correction is required. President Xi has been centralizing authority around himself and may try to make one. However, he faces opposition from the old guard, including former presidents, especially in his campaign to root out endemic corruption. It is the decline of China’s status that should actually worry us as heightened nationalism could be stoked to undertake a rash act for the survival of the party. We as an emerging nation of international import need to be prepared for such an eventuality, especially with a long-standing bilateral border dispute.


1. Kissinger, Henry (2014). World Order. New York, Allen Lane

2. Nye Jr., Joseph S. (2011). The Future of Power. New York, Public Affairs

3. China is not a threat, but a challenge. (2014, May 25). Retrieved from

4. Kaplan D., Robert (2010). The Geography of Chinese Power. Foreign Affairs

5. Detlef, Nolte (2007), How to compare regional powers, analytical concepts and research topics. German Institute of Global and Area Studies


[1] China’s Military Budget Increasing 10% for 2015, Official Says: 

[2] China to increase defence spending by ‘7-8%’ in 2016 – official

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The views expressed are of the author and do not necessarily represent the opinions or policies of the Indian Defence Review.

About the Author

Maj Gen Vivek Sehgal

has extensive experience in Counter Insurgency operations both in J&K and the North East.

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