As China and India rise in tandem, their relationship will shape world politics.

Shame they do not get on better

THE ECONOMIST China and India Contest of the century August 19, 2010

A hundred years ago it was perhaps possible to predict which powers would shape the 20th. Century: Britain was losing its place as a huge empire and Japan, Germany and United States were vigorous new forces. Their emergence brought enormous prosperity, but also unimaginable damage. Now digest the main historical event of this week: China has officially become the worlds second-biggest economy, overtaking Japan. This created a big concern in the United States because China could overtake the United States sooner than previously thought. But Chinas real race is with another Asian power: India. These two Asian giants are very peculiar, they have the population and size of a whole continent, but they are mostly poor. The size of the population must neither be seen as a determinant matter, nor considered as determinant for forecasts of investment banks. Twenty years ago Japan was seen as the main rival of America. Currently, countries as huge and complicated as China can collapse under their own contradictions, and their foreign relationships are a great risk, including the one with Japan. There are a lot of warnings; the chances are it will come down, once again to the relationship of two Asian giants. How these two countries get to manage their relationship might determine the face of the 21st. century. The situation in both countries is neither easy nor calm. In China, the government tends to say that the western world conspires against them. Thats why they carry on actions like being friends with Chinas enemies: Japan, South Korea, Taiwan, India and Vietnam. Not only is China nowadays the worlds most populated country, but it is also the greatest exporter, the most important car maker, the main carbon-emitter and the biggest consumer of energy. It is also really updated in terms of both technological capacity, and developed skills in the outer and cyberspace. Chinas military advances are a big concern for its neighbors and regional rivals. In India, things are also not calm either. They still remember the humiliation they suffer at Chinese hands in a brief war held 50 years ago. They deeply mistrust the Chinese community, and they surely believe that China is working to destroy them in a lot of ways; for example, by blocking them off a seat at the United Nations

Security Council, and by making friends with other Asian countries, especially Pakistan. Indians have also noticed that China is taking a stronger position in its border conflicts at Tibet and Kashmir, which has pushed India closer to America. China sees India as a both dirty and messy democracy, and also as a long term rival, especially if it continues getting closer to the United Sates. In 1990 India was a rich country, but China grew incredibly far ahead and it seemed hard for India to reach Chinese. However, Indias long-term prospects now look stronger. Chinas population is getting older, and India has a real manpower boom. Many people think India can beat China somewhat soon in terms of growth. India possesses a democracy, which is a social advantage, and it has a lot of friends in the West. Very few people think these two countries will come to war. Optimists prefer just to see the $60 billion in trade they will reach this year. Nevertheless, problems do exist. In order for these nations to solve them and for war not to burst, a few things must be done: First, the slow progress towards a border settlement needs to be summarized and China must undertake this task. They have already done it with other neighbors, so this is a familiar experience to them. Second, and most important, Asia does not have institutions that help settle conflicts and maintain peace. It would be a good thing if China, Japan and India could start building regional forums to channel their inevitable problems into collaboration and healthy competition. In the 20th. Century the west built up the rules that set order into the world. China and India should nowadays be playing a bigger role shaping the rules that will govern the 21st. century. This requires concessions from the West, but it also requires that China and India commit themselves to achieve an international order ruling nationwide.