Abstract
Being two giant economic players of the world, China and India experienced a disastrous border conflict in the Ladakh area of the Line of Actual Control (LAC) during April 2020, just at the beginning of the Covid-19 outbreak. This theoretical paper is an effort to identify the tentative impact of that border clash on the bilateral trade between two countries from the perspective of regional geopolitics. The author has utilized secondary information such as newspapers articles, journal articles, online sources, and economists’ opinions on this issue as well as has made some predictions based on the previous bilateral trade statistics. The author proposes that even though the border issue has become very sensitive and important for both countries regarding the geopolitical necessity, the bilateral trade scenario will not be much affected on a substantial scale on a long-term basis. The author further predicts that a likely trade conflict between the two economically promising countries will be contagious for both. Finally, the author expects this paper to be beneficial for further research attempts focusing on the geopolitical economy of bilateral trade.
Highlights
According to the recent economic statistics, China is the second largest, and India is the fifth-largest economy based on nominal GDP (Business Insider, 2020)
This paper has focused to identify the tentative impact of that border clash between the two nations on their expected future bilateral trade scenario
This paper has tried to analyze the negative consequences of an all-out trade conflict between India and China that originated from the contemporary border clash
Summary
According to the recent economic statistics, China is the second largest, and India is the fifth-largest economy based on nominal GDP (Business Insider, 2020). The existing literature is still a matter of explanation as authors such as Anderson (1996) refers to the frontier as a synonym to borders and as both institutional and a process showing the limit of a country’s autonomy (Tesfamichael, 2011), and at the same time, as an instrument of its policy and “markers of identity” (Donnan & Wilson, 2001) Such geopolitical conflicts often lead to raising national egoism that consistently creates hatred toward opposing nations as well as a call for boycotting the product and/or services produced in that country (Barwick et al, 2018). Major export items by both the countries have been illustrated in table 2
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