Why India–China relations could reshape the global order – Manoj Kewalramani
India-China relations have entered a phase of cautious re-engagement, but beneath the diplomatic optics lie deep structural fault lines shaped by power asymmetry, border tensions, economic interdependence, and great power rivalry. Dan Banik speaks with Manoj Kewalramani about whether the relationship is stabilizing into a cold peace or simply entering another cycle of strategic competition with global consequences.
Why India–China relations could reshape the global order
Few bilateral relationships today are as consequential, or as structurally complex, as that between India and China. These are two neighbors. Two civilizational states. Two powers that began from comparable levels of poverty in the mid-20th century and have since lifted hundreds of millions out of poverty and deprivation. However, they have done so through markedly different political systems and development pathways.
China’s rise has been faster, more centralized, and more effective in converting economic growth into infrastructure, technological capacity, and hard power. India’s path has been democratic, federal, contested (at times frustratingly slow) but resilient and plural.
In an increasingly unstable world, this relationship carries growing weight. The United States appears unpredictable. Global institutions, especially United Nations agencies, are under financial strain. The language of globalization is giving way to the language of “de-risking.” In that context, the India–China equation becomes central to the shape of the emerging global order.
In my latest episode of In Pursuit of Development, I speak with Manoj Kewalramani about where this relationship stands and where it may be headed.
A cold peace
After five years of tensions following the 2020 border crisis, relations have entered what one recent analysis describes as a phase of “cautious and fragile re-engagement”. High-level meetings between Prime Minister Narendra Modi and President Xi Jinping in 2024 and 2025 signal a shared desire to stabilize ties. However, as Kewalramani argues, the structural fault lines remain intact and the quest for a new equilibrium is likely to be long, slow, and fraught with friction. This is not reconciliation. It is not strategic alignment. It is something more restrained: a cold peace.
From parity to asymmetry
In 1990, India and China were broadly comparable in economic size. Today, China’s economy is more than five times larger. That asymmetry matters. Not only in material terms, but in how each side perceives the other. The relationship is no longer defined by optimism, as it was in the early 2000s when the term “Chindia” captured imaginations. Instead, it is characterized by caution. Trade continues to grow. Diplomatic channels remain open. But political trust remains thin.
Moreover, economic interdependence has not eliminated strategic rivalry. India accounts for roughly 10 percent of China’s global trade surplus — over $100 billion. Indian pharmaceutical firms depend heavily on Chinese active pharmaceutical ingredients. Electronics and industrial inputs continue to flow. At the same time, Indian policymakers increasingly speak of “de-risking,” not decoupling. The concern is vulnerability and whether trade dominance can become geopolitical leverage.
More than a border dispute
This relationship is not only about a contested boundary. It is about how economic engagement survives political distrust. It is about how asymmetry shapes perception when one power sees itself as comfortably dominant. And it is about how two ambitious states, each convinced of its global destiny, navigate overlapping spheres of influence across Asia, Africa, and multilateral institutions.
Both countries profess commitment to multilateralism, including support for the United Nations, the WTO, BRICS, and the Shanghai Cooperation Organisation. However, divergences quickly emerge beneath the surface. For example, China continues to withhold explicit support for India’s bid for permanent membership on the UN Security Council. Within BRICS, India resists overtly anti-Western positioning. Even where interests align (e.g., concerns over carbon border taxes), coordinated strategy is far from guaranteed. And national power calculations intrude quickly.
Development lessons and limits
From a development perspective, the comparison between the two countries is unavoidable. China has delivered infrastructure and urban transformation at extraordinary speed. Pollution control in Beijing is frequently cited as a case of decisive state action. India, meanwhile, continues to wrestle with the constraints and complexities of federal democracy. The question is whether lessons can travel across fundamentally different political systems. Can India adopt operational practices (in project delivery, emissions standards, or industrial policy) without importing centralized political structures? And is Beijing prepared to recognize India’s developmental aspirations as legitimate and autonomous?
Kewalramani argues that economics alone will not normalize the relationship. Politics sets the ceiling. A serious border flare-up could reverse recent openings overnight. For now, what we see is interdependence without trust. Cooperation in some domains, competition in others. A relationship too important to rupture but also too fraught to stabilize fully.
A cold peace between two rising powers. And in a fragmented world, how they manage that cold peace may help determine the contours of the global order.
🎧 Listen to the full conversation on your preferred platform (links to Apple podcasts and YouTube below).
 | A guest post by
|