Xi Jinping’s trip to India and Nepal seen as much-needed win for China at critical time

There were few tangible results from Chinese President Xi Jinping’s meeting with Indian Prime Minister Narendra Modi over the weekend, but analysts say his whirlwind three-day visit to India and Nepal was a much-needed win for Beijing.

As its geopolitical rivalry with Washington escalates amid talk of the US and Chinese economies decoupling and fresh rows over Hong Kong and Xinjiang, Xi’s visit saw trade ties elevated between Beijing and New Delhi despite their often testy relations [1].

With 20 deals signed during his brief trip to Nepal – covering railway, port and energy projects – Xi also managed to shore up Kathmandu’s support for the Belt and Road Initiative [2], his signature global investment and infrastructure scheme that has met with increasing suspicion and resistance elsewhere.

There was little detail about what was discussed when Xi and Modi met on Friday evening and Saturday [3] – strolling along the Bay of Bengal beach together, during a 2½-hour private dinner, or their one-on-one conversations at the historic resort town of Mamallapuram, south of Chennai.

But most analysts agreed, based on official statements released separately by the two sides, that the Indian visit was more symbolic than substantial as both leaders sought to steer clear of touchy bilateral issues – from Kashmir to the belt and road plan and Chinese telecoms giant Huawei [4].

“The summit was big on pomp, pageantry and nice-sounding phrases but short on tangible results,” said Brahma Chellaney, professor of strategic studies at the New Delhi-based Centre for Policy Research.

According to Indian foreign secretary Vijay Gokhale on Saturday, India raised its concerns about the Regional Comprehensive Economic Partnership [5] (RCEP), a proposed free-trade agreement led by China, during the so-called second unofficial summit between Xi and Modi in 18 months.

They reaffirmed a pledge made at the last summit in Wuhan, China, that “both sides will prudently manage their differences and not allow differences on any issue to become disputes”, an Indian government statement said.

However, the contentious issues of China’s Huawei 5G network and India’s decision to revoke the special autonomous status of Kashmir were not discussed, Gokhale said.

While Xi said that he and Modi held “candid discussions as friends”, the Indian leader hailed their Chennai meeting as marking “a new era of cooperation” between the two countries.

One of just a few concrete results was the establishment of a new mechanism to discuss and resolve India’s trade deficit with China, which stood at US$53 billion last year, with Chinese Vice-Premier Hu Chunhua and Indian Finance Minister Nirmala Sitharaman to taking leading roles.

Xi said China “is ready to take sincere action” on trade and “to discuss in a very concrete way how to reduce the trade deficit”, Gokhale said.

Chellaney noted that despite similar pledges to improve ties, the two sides had made little progress on the trade front since the Wuhan summit in April last year.

“India’s commitment to enter into trade talks was a diplomatic win for China. It buys China time to initiate what it is good at – endless negotiations,” Chellaney said. “In fact, it buys time at a critical time for China when the process of decoupling of the American and Chinese economies is under way.”

Sun Shihai, an India expert at Sichuan University, said it was not surprising that the latest summit did not produce quick solutions to long-standing issues that have hindered bilateral ties for years.

“Despite the leadership summits, there’s still deep-rooted suspicion and antagonism between the two countries. That’s why top leaders need to build personal rapport to address the trust deficit and set out a clear blueprint for the long-term and strategic development of bilateral ties,” he said.

It would be unrealistic to expect breakthroughs, Sun said, especially on their bitter territorial disputes in the remote Himalayan region, which saw a war in 1962 and a 70-day stand-off in 2017.

He noted both sides touched on the border issue in their statements, citing a political agreement signed in 2005 that promised to take into account both sides’ “strategic and reasonable interests”.

While India analysts had mixed views about Xi’s Indian visit, they were more critical of his trip to Nepal, the first by a Chinese president since 1996, and which ended with a slew of deals [6], including for a trans-Himalayan railway.

For New Delhi, Xi’s decision to go to Nepal, a traditional ally of India, right after his summit with Modi as well as his move to host Pakistani Prime Minister Imran Khan [7] on the eve of his India trip last week signalled that competition and friction in the relationship may continue.

“The Nepal visit showed how Xi is pursuing his strategic ambitions on India’s doorstep. In Nepal, he upgraded ties to a strategic partnership with a country that is symbiotically tied to India,” Chellaney said.

Mohan Guruswamy, chairman of the Centre for Policy Alternatives in New Delhi, said the proposed rail link between Lhasa and Kathmandu, which has security implications for India, would be more interesting to watch.

“I don’t think it will be long before India offers to build a rail link from Kathmandu to join its rail system,” he said.

“There will be a few noises in India about the security implications of a China-Nepal rail link. But such links also increase vulnerability. So the strategic communities in both China and India will have one more bone to chew,” he added.

Sun said Nepal, which shares a long border with Tibet and is home to around 20,000 Tibetan exiles, was of strategic importance for Beijing’s national security and global ambitions.

“While it is understandable that China and India are strategic competitors from a geopolitical point of view and Indians are suspicious of China’s manoeuvring in South Asia, deemed by New Delhi as its sphere of influence, Beijing has tried its best to accommodate concerns from New Delhi,” he said. “It is crystal clear that Beijing will not pursue better ties at the cost of its regional friends and allies, especially Pakistan.”