CPEC and changing dynamics of China–India relations

Abstract

In the eyes of many Pakistani and international observers, the China–Pakistan Economic Corridor (CPEC) is changing the dynamics of geopolitics and socio-economic relations in South Asia. Is this likely to dampen or intensify the rivalry between India and Pakistan? Indian policymakers and analysts assert that the CPEC is China's device to ‘encircle India’ and Pakistan is only a collaborator in this scheme, while Pakistani policymakers claim that it is a ‘game changer’ and is solidifying the China–Pakistan strategic partnership. The reality is that India–China economic relations are booming with trade and investment, to the tune of more than 80 billion USD, while China–Pakistan trade and investment total less than 5 billion USD. Given this reality, would China encourage India to join the CPEC? Would Pakistan welcome Afghanistan, Iran and India into an expanded CPEC? Would China be receptive to the idea of expanding the CPEC? This chapter explores some of these questions and argues that without the inclusion of India, the CPEC could ignite regional rivalry, which in turn could compel China to review its time-tested policy of ‘non-interference’. As the CPEC unfolds, in South Asia, China's biggest challenge will be managing India–Pakistan contestation. Is China ready for it?