When India and China agreed yesterday to work out their long-standing border dispute, it was rightly hailed by an Indian adviser as one of the most significant documents ever signed by the two countries. Forty-three years after New Delhi and Beijing went to war over their largely undefined border, this laudable agreement demonstrates just how much the world has changed.
Indeed, this deal was not really about frontiers; it was about business. Part of the 2,200-mile border between India and China runs through some of the roughest terrain in the world but these national borders matter today not for themselves but as places over which fast growing trade is steadily flowing.
Neither emergent economic power wants to become bogged down in territorial issues. They want to get on with expanding their economies and taking their place in the club of the world’s wealthiest nations. The economic growth in both countries has been startling and yesterday’s deal clears the way for each to work together to capitalize on this flowering of financial power.
China has established itself as the pre-eminent global manufacturing center, producing about half the world’s television sets and refrigerators. It is so free of labor troubles that even some Indian entrepreneurs have relocated their production facilities across the border. India has yet to hit its stride in manufacturing — by some estimates it is ten years behind China — but it does, however, enjoy a clear lead in the service sector, not least in the software industry.
There is at the same time one big difference between the two countries. India is the world’s largest democracy while the Chinese appear content to get on with the job of improving their lives without concerning themselves overmuch with politics. India’s bureaucracy may at times be maddening but it is a reflection of a free country operating under a democratic rule of law. Indian Parliament throws up a raft of new rules every year that are meat and drink to bureaucratic functionaries right down to the lowest levels. As and when India learns to streamline its rules and its bureaucracy, it will be in one sense in a stronger position than China, which has yet to work out its political transformation.
Yesterday’s agreement to work positively to define the frontier between the two Asian giants was an act of great statesmanship by both. It clears the decks for more important matters, one of which is China’s planned development of its western regions. There are clear opportunities for Indian investors and entrepreneurs, who have already invested $100 million in China, to participate in the blossoming of these areas. The hope is that a great deal more business will now cross a border which, though not yet formally fixed by agreement, had up to now been a potential source of disagreement between the two regional superpowers.
