Home Pakistan China Kashmir and border dispute will likely top the agenda as India and China leaders meet – CNBC

Kashmir and border dispute will likely top the agenda as India and China leaders meet – CNBC

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India’s Prime Minister Narendra Modi (L) and China’s President Xi Jinping at the 2017 BRICS Summit in Xiamen, China, on September 4, 2017.

Grigory Sysoyev | TASS | Getty Images

Chinese President Xi Jinping and Indian Prime Minister Narendra Modi will be meeting in the coastal town of Mamallapuram in southern India starting Friday.

During their two-day summit, the leaders are expected to talk about their unsettled border dispute, and may also address their differences over Kashmir — a territory claimed by both India and its arch-rival Pakistan. China is one of Pakistan’s top allies.

“India and China have a fraught relationship, yet they are also far from being each other’s top foreign policy issue,” said Simon Baptist, global chief economist and managing director at the Economist Intelligence Unit.

In August, India revoked the special status granted to the territory of Jammu and Kashmir — a move that angered Pakistan which has fought three wars with India since 1947 over the disputed territory.

Ahead of their meeting, Xi said on Wednesday he was watching the situation in Jammu and Kashmir and will support Pakistan in issues related to its core interests, China’s state news agency Xinhua reported.

But Modi will most likely want to reiterate to Xi that the Kashmir issue is an internal matter for India, said Rudra Chaudhuri, director of think tank Carnegie India in a note on Thursday.

Border dispute

India and China share a 3,500 kilometer border which has been largely peaceful, even though there have been occasional stand-offs between soldiers over the last two decades.

The two sides have a long-standing dispute over the location when territories of India, China and Bhutan intersect.

“They’ve got territorial disputes on both sides of the Himalayas. India gets annoyed with China for helping Pakistan, and putting investment into Pakistan, which causes India’s great foreign policy obsession,” Baptist said.

“The territorial disagreements are non-negotiable for both sides, so any real rapprochement is exceedingly unlikely,” he added.

Amid all the geopolitical uncertainty globally, it is now “left to Modi to assess the extent to which Xi’s China is prepared to accommodate, if not accept, Indian interests and concerns,” Carnegie’s Chaudhuri said.

India-China economic ties

Another point of contention between the two countries is China’s the Belt and Road Initiative (BRI) — an ambitious infrastructure project that seeks to connect dozens of countries in Asia, Africa and Europe.

India has consistently snubbed China’s invitations to join the BRI. Meanwhile, Beijing has backed many infrastructure development projects in Sri Lanka and Bangladesh, countries that India considers as part of its sphere of influence.

Chaudhuri said New Delhi has not been keen to join the BRI because a lot of those projects are built on the contested territory of Pakistan-controlled Kashmir, and because a lack of transparency and respect for the rule of law.

Their meeting will most likely not result in a trade deal of any sort as there is very “little interest in a trade deal,” Baptist said. “India aspires to compete with China in manufacturing (although it is a Long way behind) and China does not want to open to India’s strong services sector, even if language wasn’t already a big barrier.”

At the end of the day, said Baptist, the two Asian powerhouses have their hands tied with other more important diplomatic matters right now, and will have little time to try to court each other.

“So for both sides, this relationship is not a super critical one … the two countries are not going to become close allies or resolve their tensions any time soon. On the other hand, I don’t think they will escalate either,” said Baptist.

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