JAIR Journal of International Relations

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From Ideological Contest to Civilizational Clash ? Reexamining the World Today

Sobhanlal Datta Gupta

Former Surendra Nath Banerjee Professor of Political Science

University of Calcutta

[Text of the 9th Foundation Day lecture of JAIRR delivered on 20 July, 2016]


Honorable Vice Chancellor of Jadavpur University, Professor Suranjan Das, my revered teacher Professor Radharaman Chakrabarti, distinguished guests, colleagues and students, 

I feel deeply honoured and privileged for having been invited to deliver the 9th Foundation Day lecture organized by the Jadavpur Association of International Relations (JAIRR). I have chosen this topic  in order to examine two interrelated issues. In the post cold war scenario the thesis of Francis Fukuyama that ideological contest is now a thing of the past and that western liberalism is the universal goal towards which the world is moving fired the imagination of the West. Apparently quite opposed to this understanding emerged an alternative perspective, outlined and defended by Samuel P. Huntington, who propounded that the world today is characterized not by the presence of any single pervasive ideology but by a clash of civilizations, western and non-western, and that we are heading towards a fragmented and not a homogenous world order. At this moment one may quite legitimately question the relevance of the debate involving these two stalwarts today, since Fukuyama and Huntington talked about these issues in the immediate aftermath of the end of the cold war, whereas today we have already  stepped into the closing years of the second decade of the new millennium. The world, indeed, has changed in a big way since the time when these writings surfaced in the early 1990s.  To my mind  as we are racing towards the next decade, the debate sparked off by Fukuyama and Huntington in the early 1990s, however, sounds increasingly more relevant today at least for three different reasons.

First, as neoliberalism in the wake of globalization has become the new gospel of the West and the impression is gaining ground in many circles that this is the one and exclusive roadmap of the future, Fukuyama demands a revisit. Second, as fundamentalist forces are assuming increasingly an aggressive stance across the globe and as religious fundamentalism today poses a  major threat to large parts of Europe and Asia, Huntington deserves a reexamination. Third, although Huntington is no longer alive, the positions of Fukuyama and Huntington have been forcefully challenged over the years by scholars like Edward Said and Noam Chomsky and the radical Left across the globe,  opening up new frontiers of critical analysis and learning, which may be considered as the constituents of an alternative perspective.                

It is in this light that in the first part of my presentation I would focus on the apparent dissimilarities and the striking similarities between the two positions, represented by Fukuyama and Huntington. In the second part I will identify some of the problems emerging out of the positions that they represent. In the third and concluding part I would focus on  an alternative understanding of the world that we are living through.



Francis Fukuyama came to limelight when, in 1989, he published the article  “The End of History ?”[1], followed by “Second Thoughts : the last man in a bottle”[2], published in 1999, published on the occasion of the tenth anniversary of publication of his first essay, as  it had already become a hugely debated article in the period after the end of the Cold War. In between, however, in 1992 he came out with a book, reflective of the spirit of these essays, under the title The End of History and the Last Man[3] . One should also take into consideration a free and frank   interview[4] dated 17 January, 1992 given by him to a TV channel  where he discussed his book.  These are broadly reflective of Fukuyama’s thoughts on the world after the end of the Cold War and the demise of the USSR and the Soviet bloc. Trained in the Hegelian understanding of history and a strong advocate of Western liberalism, Fukuyama was a researcher working in the Rand Corporation of the United States, when he launched these writings. Broadly, his ideas can be summed up in terms of the following propositions. First, his view of history is essentially a defence of a homogenized world view, the idea being that the post-Cold War world is inexorably moving towards an order which will be based on the values of western liberalism. He, however, clarified that this actually means that it is the principle of liberalism which has triumphed, although operationally it has not yet succeeded in all places, one of the reasons being the  malleability and unpredictability of human nature. Second, authoritarianism  has failed across the world, its two variants being fascism and communism. Third, unprecedented changes in the field of science and technology have ushered in a regime of immense prosperity, strenghthening thereby the conditions of a robust market society and economy, the hallmark of liberalism. Fourth, taking cues from Plato, he argues that in the world marked by pervasive inequality there is the struggle going on  for recognition of equality, which Fukuyama characterizes as the spirit of thymos and it is under liberalism that the irrational desire to be recognized as greater than  others would be replaced by a rational desire to be recognized as equal. Fukuyama’s traces the fall of Soviet socialism to the failure of the system to recognize this principle of equality, since it was an order which thrived on the idea that the authoritarian party elite was superior to the rest.  

As stated above, this stands apparently in sharp contrast  to Samuel P. Huntington’s understanding of the post cold war scenario. Huntington’s position on the post cold war world, indeed, appears to be  quite opposed to Fukuyama’s. This refers to two of his most well-known pieces, namely, “The Clash of Civilizations ?” published in 1993[5],followed by his book The Clash of Civilizations and the Remaking of World Order[6], which came out in 1996. The areas of apparent dissimilarity and difference between Fukuyama and Huntington may be  summed up under the following propositions.    

First, in contrast to Fukuyama’s essentialization of the Western notion of liberalism after the defeat of fascism and communism Huntington argues that  this civilizational (=cultural ) quest of the West is not necessarily acceptable to the non-Western societies. They also want to tread the road of modernization but not perforce through the route of westernization. In fact, they contest this  universalist strategy of the West, which provides the clue to Huntington’s “clash of civilizations” thesis. This leads him to espouse the notion of multiple civilizations. Second, as distinct from Fukuyama’s understanding that technological growth would promote the cause of liberalism, Huntington finds no necessary correlation between the two. Citing the instances of China and the regimes of East Asia he points out that in these countries one cannot miss the lurid contrast between phenomenal economic growth and extremely weak, virtually fractured, democracy. Third, while Fukuyama’s accent is on the recognition of rights and freedoms by liberalism, which constitutes its moment of triumph, for Huntington recognition has a different connotation in the post cold war era. For him, it is essentially a question of recognition of one’s identity to the exclusion of others, which should be viewed in the light of the following statement : “We know who we are only when we know who we are not and often only when we know whom we are against.”[7]  Fourth, in contrast to Fukuyama’s vision of a homogeneized world, based on an optimistic vision of the future, which is marked by the spirit of liberalism, Huntington espouses a rather pessimistic understanding, since he views the world as heading towards a clash and strife of multiple civilizations. Significantly, in an  interview given to Rajiv Mehrotra  on Doordarshan[8] he observed that this clash would come to an end around 2030, when democracy would be embraced by the non-Western societies.

These apparent dissimilarities, however, are overshadowed by striking similarities, if one makes a careful scrutiny of the positions of Fukuyama and Huntington.[9] In the first place, both the authors put a question mark after their titles when their aforementioned pieces appeared for the first time in National Interest and Foreign Affairs respectively. But in their subsequent writings this mark, suggesting a sense of doubt, disappeared, confirming thereby the arrival of  a homogenized world (Fukuyama) and a world based on a clash of civilizations (Huntington). Second, while Fukuyama refers to the drive for recognition in a world marked by inequality, necessitating the birth of liberalism, which alone can honour the notion of the individual,  Huntington too essentializes the spirit of a universalist civilization when he declares that democracy has flourished most successfully in countries influenced by Christianity and Western values, despite Western arrogance. His idea assumes special significance when he further says that it is Islamic culture and the hangover of the orthodox ideas of Marxism-Leninism which have made the possibility of democracy weak in the countries dominated by these ideologies. Third, despite their contrasting views of the future, one cannot ignore the  underlying unity of their understanding. Thus, both Fukuyama and Huntington share a predictive and normative vision of the future, as both of them pin their faith in the universalization and triumph of  Western liberal democratic values. For Fukuyama the victory has already been achieved, while for Huntington it is yet to come.                                                             


This is an understanding which, however, causes serious problems for many. One : Huntington equates civilization with culture, since for him civilization is culture writ large. Consequently, he considers clash of civilizations as clash of cultures (Western vs non-Western). This is difficult to accept for anyone who is conversant with the perspectives of cultural anthropology in this field. This alterative understanding argues that civilization is the road to modernity, symbolizing a universal stock of goods and values but which need to be worked out locally in the cultural frame of a particular society. The writings of Franz Boas and Clifford Geertz are two examples in this direction. In other words, there is a dialectical play of universalism and localism  involved in the understanding of  the interrelation of civilization and culture.

Two : both Fukuyama and Huntington are strong advocates of a brave new world of the future which will witness the ultimate triumph of western liberalism across the globe. In the construction of this grand narrative they are guided by an essentialist understanding that liberalism would strike its roots in all societies irrespective of their cultural foundations. This is a totally wrong understanding, since ideology cannot strike roots without an appropriate cultural environment. This precisely has been the problem faced by the radical Left when they have tried to penetrate the non-Western societies by drawing their resources from Marxism, an essentially European doctrine that thrived primarily in the continent. Thus, Mao had to adopt a sinification of Marxism, Ho Chi Minh had to situate Marxism in the Vietnamese tradition and culture, while Arab communism had to take into account the philosophy and teachings of Islam in the application of  Marxism in the Muslim world.

Three : to take the cue from Edward Said’s writings,  it is now possible to argue that there is no homogenous West just as there is no universalist East. Thus, when Fukuyama today talks about Islamo-fascism, two fundamental questions need to be addressed. First, fascism as a political and ideological doctrine emerged and was practised in the West, not in the East. Second, in the West, especially in the United States today, we witness sharp polarization of the Right and non-Right, which has a very broad spectrum including leaders like Bernie Sanders. So it would be a travesty of truth to say that the entire West is inclined towards endorsement of  the kind of liberalism that Fukuyama stands for. After all the ‘Occupy Wall Street’ movement took off in the United States itself.

Four : in the Saidian critique[10], which is otherwise quite powerful and stimulating, one element is missing. The same problem recurs in Bhikhu Parekh[11]. They consider the Marxist critique of colonialism as a bad Eurocentric narrative, which does not show the way out of  the colonial conundrum. What they completely ignore is how the first critique of colonialism on the operational level originated from within Europe and how it critiqued the West itself. Thus,  Taking the cues from actual history it is an undeniable truth that it was revolutionary Russia after 1917 which for the first time in history openly extended material and moral support to the anti-colonial struggles in the East. Moreover, after the formation of the Communist International in 1919 it is the leaders of the Russian section of the International, i.e. Trotsky and Bukharin, who severely reprimanded many times the leaders of  the West European communist parties of those countries which were in possession of colonies in Asia and Africa. Their main allegation was that these communist parties did not make enough efforts to extend active support to the anti-colonial struggle of the people in their colonies, one of the reasons being a racist feeling of “empire consciousness”, which dominated the mind of the average party member.

Five : the Asian experience  as well as the  Russian and  East European scenario  explains why it is so difficult for the ideas of Western democracy to take off and flourish in these countries and why the futuristic vision of  Fukuyama and Huntington has virtually failed to generate any enthusiasm in these parts of the world. This is explained by the fact that these societies are quite comfortable with the absence of democracy and the pervasive presence of an authoritarian tradition. This refers to the concept of Asian values in China and East Asia and the ‘normalcy’ of one party rule in the erstwhile USSR and Soviet bloc. The result is a complete mess that the transition to western democracy has led to in these regions  in the post-Soviet era. The same has  happened in the Middle East and North Africa in the wake of the ‘Arab spring’.

Six : Fukuyama explicitly and Huntington implicitly recognize that the demise of  communism,  most vividly evident in the end of the Soviet era, constitutes the take off point of their futuristic project. The problem is that throughout the Soviet era there were alternative currents too, albeit not always strongly visible, which operated, challenging the dominant model. Thus, there were challenges posed by the anti-Stalinists in the Stalin era, followed by the 20th Congress of the Soviet Communist Party in 1956, the Prague Spring in 1968, the advent of Eurocommunism in 1974 and the inauguration of perestroika and glasnost by Mikhail Gorbachev in 1985. They failed no doubt, but their failure and the inability to gain popularity and predominance simply establish the point that what came to an end was a particular system and a particular model, while the alternative models had hardly any time to be experimented with. By the time Gorbachev came to power it was too late to usher in an alternative programme of the future, which would be a radical break with the past. Both Fukuyama and Huntington thus essentialize not only the West but they essentialize one particular model of socialism too.


Finally, what then can be a projected alternative, away from the positions of Fukuyama  and Huntington ? This warrants a reexamination of  today’s world in a new perspective. Indeed, what emerges from the two positions is that these two scholars ultimately vindicate an essentialization of the West and its liberal values. This, however, evokes a sharp  response from the side of the non-Western societies, which Huntington interprets as ‘clash of civilizations’. What actually it leads to may broadly be considered as aggressive assertion of  the nativist identity of the non-Westerners. This, in turn, has generated  a counter essentialization of nativism. This, however, will lead us nowhere. Taking the cue from Edward Said’s aforesaid lecture  what can be suggested is that the need of the hour is to deessentialize both the West and the East, since they are not really mutually exclusive. What is needed is the recognition but not the celebration of difference. The West’s essentialization of the self and complete erasure  of  otherness and thereby the notion of difference leads to the other extreme, namely, celebration of the nativist identity of the non-Westerner. The imperative is to break down the boundaries of parochialism in the name of defence of authenticity and to rather effect negotiation between the East and the West. This is a strategy that the West too has to adopt. It has to break out of the shell of homogeneity and be ready to negotiate with a larger and more complex world beyond the realm of the West. It has to reckon with the notions of hybrdity, diversity and dfference. Both the West and the East have to bid farewell to their respective cocooned existence in the name of either a false celebration of modernity or a vapid defence of nativism. The two worlds, the East and the West, must learn from each other, respect each other and consider themselves as equal partners in the quest for an enrichment of our civilization. This was the message of Tagore on one level. On another level it is precisely this message that Satyajit Ray aimed to communicate in his film Agantuk (The Stranger), as Utpal Dutt, the principal character, the stranger, a globe trotter, exhorts the child to share and learn from the cultures of others and never to live a life of cocooned existence.

Thank you all.                                                                     










[1] Francis Fukuyama, “The End of History ?” The National Interest, Summer, 1989.

[2] Francis Fukuyama, “Second thoughts : the last man in a bottle?”, The National Interest, Summer, 1999. 

[3] Francis Fukuyama, The End of History and the Last Man (New York : The Free Press, 1992).

[4] This video is  available on You Tube. Accessed on 21 July, 2017.

[5]  Samuel P. Huntington, “The Clash of Civilizations ?” , Foreign Affairs, Summer, 1993.

[6] Samuel P. Huntington, The Clash of Civilizations and the Remaking of World Order (Gurgaon : Viking India, Penguin Books India, 1997). 

[7] Ibid. p. 21.

[8] This video is available on You Tube. Accessed on 21 July, 2017.

[9]  See in this connection Costa A. Georghiou, “Unexpected convergence : the Huntington/Fukuyama Debate” in Accessed on 21 July, 2017 and Chan-young Young, “Revisiting Fukuyama, The End of History, The Clash of  Civilizations, and the Age of Empire” in on 21 July, 2017.     

[10]  See especially Edward Said’s lecture “The Myth of the Cash of Civiliztions”, available on You Tube                   Accessed on 21 July, 2017.

[11] Bhikhu Parekh, “The West and its Others”, in Keith Ansell-Pearson et al (eds.), Cultural Readings of Imperialism. Edward Said and the Gravity of History (New Delhi :Aakar Books, 2014), pp.188-191.




ISSN 2348-7496


July — December, 2016


© All Rights Reserved by JAIR. Reproduction in whole or in part, in any form witout written permission is prohibited.

Indigenous Struggle, Neoliberalism, and Politics in Ecuador

Arnab Chakrabarty


Problems of Drug Trafficking in Central Asia

Bijaya Kumar Das


Environment and India’s Foreign Policy: The Past and the Future

Piyali Dutta


Afghanistan: Prioritizing America’s ‘Other’ War

Moutusi Paul Choudhury (Naskar)


‘4 Dimension’ Policy Initiative of the Contemporary Government of India:

Is India Making a Move as a Leading Global Power?

Roshni Chaudhuri


Moving Beyond the Anarchy Problematique? Explaining the

Dynamics of Contemporary IR Through the Dominant

Paradigms in IR Theory

Prosenjit Pal


The Changing Dynamics of Indo-Japanese Security Partnership in the

Post-Cold War Era: An Overview

Debjani Ghosal

This Journal is published from the Grant-in-aid for Maintenance and Development

sanctioned to The Jadavpur Association of International Relations (JAIR) by Indian

Council of Social Science Research (ICSSR), New Delhi, for the year 2015-2016 vide

sanction letter No : F. No. 13-M7/2012-13/ RSP dated 28-3-2016.


From Chief Editor’s Desk


The latest issue of JIR (Vol 3 No 2: July-December 2016) of JAIR 2016 is now reaching its numerous subscribers and interested readers, thanks to the dedicated efforts of all concerned. It carries a fairly good number of research papers and articles on varied subjects of contemporary interest. That certainly addresses some of the engaging issues occupying the empirical space of the IR discipline. The meaning conveyed by the expression “contemporary” is, however, not confined to what is happening here and now. Rather it should be taken as stretchable so that what is located in the transitory present does not get delinked from its roots, usually, in the recent past. IR studies must necessarily follow the historical track, and that has been the general practice for most learned pursuits in the field. At the same time, the approach should neither be pedestrian nor susceptible to the lure of the story line. We are not supposed to appropriate the task of the historian but only save our fact base from going a-historical under any methodological stress, whether of positivist or any other origin. There is always the possibility of losing track or choosing the wrong one at the crossroads, and the reasons are often surprisingly tied up with the dominant trends in the IR discipline itself—surprising because we get imperceptibly, if not consciously, carried away by the stipulations of those trends. Of course it is alright if one is sufficiently convinced about the acceptability of those stipulations and hence may very well carry on without much distraction. That apart there is still some reason why it is necessary to take a little extra care while investigating and generalising on empirical data which have a distinctly non-western origin.


The point is not that there has to be a discernibe territorial authentication for every IR study with a local or regional context. Witness physical sciences where the tested laws do not go by any national name but only acknowledge the celebrity scientist as an individual discoverer. This is not because physical laws are by definition universally valid but also because the methodology involved is also universally acknowledged as valid and proper. For the discipline of IR as a whole the yard stick of validity for any research cannot and need not be nationalised or regionalised. The investigative procedure and methodology adopted must conform to some generally accepted standard, although the investigator should have every freedom to decide which data are to be accorded what kind of methodological treatment. As things stand now, fewer and fewer IR research in non-western context is tied to the western ways of thinking or argumentative pattern. In western scholarship too there has been a distinct turnaround from the old time rationalisation of approaches that were uncritical and biased. They are consciously and increasingly now in a self-critical mood, with significant debates surrounding ontology, epistemology, positivist scientism and many a construct built on them As post modernist noises from different corners are reaching a high decibel there has been a revisionist trend— more rational, more inclusive, more sensitised to the injustice meted out to the “other”. The net effect in terms of changing outlook has been considerable. 

In synch with that self-correcting trend one may seriously consider if IR scholarship in the non-western world can now shed some of their old academic phobia of getting marginalised or even denied a right of hearing in international forums. Honestly speaking, a great motivating factor for generating the erstwhile defensive-offensive mode among Asian-African-Latin American scholars in social sciences and some of their invariable assertiveness to hold on to one’s guns was largely an extended manifestation of anti-imperialist hangover. This was again coupled with the tendency in post colonial societies to either re-establish, if not blow up, or disown, if not denigrate, the national cultural-intellectual heritage which in any case is ontologically entwined with the public psyche and hence could not be wished away. The intellectual upper crust having institutional eminence may have tried to underrate and neutralise this ‘swadeshiana” but have in the process actually exposed the organic weaknesses of both nationalising and de-nationalising bents of mind. Time has arrived to free oneself from these basically self-defeating postures and enter with a free mind in the arena of academic discourse with sufficient honesty to call a spade a spade. One does not have to wear any ideological tag for seeking the truth, but should have more of the broadness of mind that allows one to accept any proven limitation of one’s academic conviction. Logically speaking, one cannot endorse such unsustainable typology, like say, a Spanish IR as distinguished from a Scandinavian one or an Indian IR as distinguished from an Iranian one. At the most what is normal in territorially adjusting one’s academic start-up is to emhasize the factual significance that is due to the local specifics, be it the regional environment or national political economy or a stratified political culture. In each of these dimensions there is for the national actor some distinct opportunities and also unavoidable stresses that may not be present elsewhere. Hence each study would also carry a distinct local flavour of its own— not because it had to be presented as a locally branded product but as a work empirically grounded in non-western milieu and yet genuinely in conformity with the accepted requisites of scientific investigation. There cannot really be a complete breach with the established modes of analysis, dominant paradigms, methodological nuances and similar other necessary thought structures that have achieved general acceptability in the IR community.  Mention has been made in the foregoing paragraph of the kind of critical rethinking that has been going on in western scholarly circles. In respect of IR it may be useful to take a look at what Robert O Keohane defines as “Six Big Questions in the Study of World Politics” followed by what Steve Smith presents as “Six Wishes for a More Relevant Discipline of International Relations”—both appearing in the Oxford Handbook of Political Science (Oxford University Press, New York,2009,pp769-782).Of the six questions three seem to be more germane to the changing contours of IR . Scholars are already seized with the other three (relating to the impact of social churnings within the state including gender rebalancing, implications of cyber technology for world politics and the possible ways to regulate the increasing stress on global environment) and therefore we can wait and see what emerges from their thinking. The more problematic three are reproduced verbatim below: [1] How has politics been affected by the expansion of force, through technological change, and its dispersion? [2]. How has world politics been affected by changes in capitalism? and [3] Is there any plausible sense in which progress has taken place in International relations and if so is this progress due to intellectual or moral advances in human thinking? Similarly, the six wishes of Professor Smith can be abridged into most engaging three such [1] IR has to become less of an American discipline, [2] IR has to reject its current privileging of a specific, culturally entailed social scientific approach, and [3] IR needs to focus on the relationship between the material and the ideational, with the much needed restoration of the core Marxist philosophical orientation in this regard. These are thoughts that are representative of the growing consciousness among leading scholars about what can be called self inflicted impairment of the discipline as practised in the west and also about the urgency of adopting correctives which call for an across the board intellectual engagement. Hopefully, there should be some significant participation of IR scholars in it from this part of the world as well, not so much in a bid to outdo or negate what the others have already started doing elsewhere as in a display of willing contribution from the non western scholars. Intellectual resources wherever they are and in whatever state need to be opened up and shared to the fullest extent especially when there has been a recognition, not too late, of the need to redesign the mode of “doing” IR and realign its content priorities. Although the foregoing observations from the chief editor’s desk did not result from any prior clearance within the JAIR fold, I think it would not be out of accord with the basic thrust of this journal known already for its trend setting openness, to expect these to act as a curtain raiser for wider deliberation with feedback coming from the seriously inclined. Radharaman Chakrabarti

From Chief Editor’s Desk: INDIA’S FOREIGN POLICY @ 70 : A TURN AROUND?


If we recall the “tryst with destiny” speech of the first Prime Minister of this country, sans the emotional overtone, what was expected to emerge was a nation that counted as a significant stakeholder in the relations of nations—of course through trials and errors, though with a keen eye to keep the error counts as low as possible. Implied, therefore, was the imperative to attain the kind of skill and prowess at making sure shots to knock down the roadblocks wherever and whenever they arose. It needed a unique mix of imagination and innovation, sagacity and shrewdness, principled behaviour and the will power to face up to adversarial circumstances. A complete and unbroken grip over the reality around was, of course, no body’s expectation since that reality itself continues to be a shifting one, subject to complex interplay of forces as much within as they originate without. Still, given the difficult terrain, one would look for footprints that carried signs of a determined approach. For long seventy years India was hard put not to deflect from what it hoped to achieve. And yet everything hinged on what successive governments thought in their wisdom to be achievable. The three vital parameters that stood out in defining what was achievable were capability assessment, capacity building and confidence to mould the external milieu. The means to be employed were also required to have the necessary degree of variety and flexibility that was not unduly held back by ideological fixations and that would also steer clear of any self-centred and sinister opportunism even as other actors might indulge in that kind of vice. Keeping these things in view, the seven decades of India’s management of foreign relations exhibit a stride that was mostly positive and achievement oriented though the confidence level of policy makers must have had its ups and downs. A surge forward was noticed now and again but the moments of sluggishness were not infrequent either.



Sino-Indian Economic and Trade Relations: An Exploration through International  Relations (IR) Theory


 Avipsu Halder , Assistant Professor, Department of Political Science, University of Calcutta, Kolkata


Abstract:  Political realism has been the  dominant trend in  the history  of Sino-Indian relations.  The war  of 1962  and  Chinese  inclination  towards  Pakistan  substantiates  this point.    Core geopolitical issues have dominated the interaction between them.    Against this backdrop, the proposed paper seeks to argue that geo-economics have overtaken geopolitics in envisioning the future trend of Sino-Indian relation.  The paper refers to the phenomenon of globalization to elaborate the rationale for this argument. Globalization has stressed the need of cooperation in the economic domain. Hence, economic interdependence has become unavoidable.  It becomes   evident   from   the   increasing partnership of the multinational corporations of India and China.  The paper concludes by arguing that mutual gains of both countries can be assured by adopting the path of liberal institutionalism and strengthening bilateral economic ties.

Key Words:    Realism, Geo-politics,    Panchsheel,    Mixed-economy,    Socialism, Liberalization, Interdependence, Geo-economics, Globalization, Capitalism.


The historical narrative of the relation between India and China has been far from cordial. Rivalry,  mutual  suspicion  and  the  dynamics  of  international politics  have  punctuated  it. Hence,  the  realist  school  of thought  (Morgenthau  1948:    4)  has  assumed  importance in exploring the dynamics of the interaction between the countries. Besides, the contentious geopolitical issues and the ramification of the Cold War politics have been pivotal in contributing to the prevalence of the realist discourse (Waltz 1979: 95).  Attempts of  cooperation between these two states mostly aimed at resolving aspects pertaining to military and security. The issues of high politics have received utmost priority (Baylis, Smith and Owens 2008: 133).  The perspective of realism in the context of Sino-Indian relations has to be  acknowledged.  However,  it  must  be  remembered  that  only clinging  on  to  the  realist framework may hinder the path of unravelling a subtle analysis of the bilateral ties between Indian and China. The reason for such an argument is not hard to comprehend. The realist school of thought overemphasizes the domain of security. As a consequence, the significance of  the  economic  realm  in  determining  international  outcomes  fails  to  receive  adequate attention.    The analysis of the present paper pivots around this argument. It is divided into two sub-sections. The first section not only reveals the basic premise of realism but also carves out the shortcomings of the realist line of theorization in Sino-Indian relation. In this endeavour, it intends to argue the case of the growing relevance of liberalist logic and possibilities of interdependence between the two states.  In other words, the paper focuses on the logic of complex interdependence (Joseph and Nye 2001: 21). In its second section, the paper  accords  considerable  importance  to  the  case  of  economic  ideology  of  both  these countries. In this context, it traces the rationale for the liberalization of their economies. It encapsulates  this  changing  approach  of  the  states  towards  the  market  forces  from  the theoretical parameters of international political economy (IPE). The paper seeks to establish the notion  that  geo-economic interests  shall  no  longer be subordinated  to  its  geopolitical counterparts. On the contrary, both possess the potential to complement one another.

Sino-Indian Relations through the lenses of Realism

In this section, the paper contextualizes the realist idea in examining the trends of relation between India and China. The objective is to bring out the shortcomings of this school of thought. However, before undertaking this task, it is pertinent to explore the core tenets of realism.  The  discourse  of  international  relations  has  focused  on  states  as  the  point  of departure of their analysis. This holds true both in the context of the realism and its neo- realist counterpart (Waltz 1979: 97). In case of the former, states are perceived as the units for determining international outcomes.  The neo-realist argument on the other hand, argues that  the anarchic nature  of the international  system  plays  a key role in  determining the behaviour of the states (Donnelly 2013: 37). It may appear that these variants of the realist school may only be slightly different. However, both of them possess a similar objective – to promote, preserve and secure the interest of the states. In other words, both are state centric in character. This propels us to explore a definition of states. The existing literature on the subject perceives states  as a political entity comprising of a definite territorial boundary managed by a legitimate political authority.     Hence, the key attributes of a state are — territory,  authority,  autonomy  and  control  (Baylis,  Smith  and  Owens  2008:  23).  These elements confirms to the Westphalian view of conceptualizing states. Let us approach these pillars of states in a critical manner. It must be noted that territory has assumed the centrality in this definition. The existence of authority and its autonomy in taking decisions must be concentrated within a politically demarcated territorial boundary. Hence, idea of exclusion and inclusion are defined in terms of territoriality (Agnew 1994: 56). The emphasis on  territory has  paved the way for the emergence of another concept for explaining the relation among states: geopolitics.  The term refers to the political significance of a geographical space. In other words, it hinges on the importance of geographical factors such as climate, location as key agents that influences foreign policy decisions. Even Alfred Mackinder’s “heartland theory of geopolitics” envisages a country to extend its control over distant landmasses in order to exert its influence vis-vis other states (Tuathail 1998: 18). Acquisition of territory by states serves two important purposes. First, it enables states to become more powerful. Secondly, such an action also contributes a long way in furthering its national interest. These aforementioned features resonates Hans J. Morgenthau’s second principles  of  classical  realism:  national  interest  defined  in  terms  of  power  (1948:  5). Therefore, adopting the realist line of thinking in visualizing Sino-Indian relations seems to be grounded in logic. It becomes evident as we explore the major issues which dominated the relations between them. We focus on three critical issues – border disputes, the war of 1962 and the exile of Dalai Lama.  In all these cases, it is noted that territory was the main bone of contention between the conflicting parties. Before we extrapolate a detailed analysis of these events, it must be must explicated that India and China agreed to operate on a cooperative basis.  The Sino–Indian treaty of peaceful coexistence, known as the Panchsheel Agreement (1954) substantiates this point (Dutt 2007: 26).  The treaty advocated that both parties should respect the sovereignty and territorial integrity of one another. Secondly, it urged both the countries to foster the spirit of equality and cooperation for mutual benefit. Thirdly, emphasis was also placed on the idea of non-aggression (Bandyopadhaya 2003: 76; Dutt 2007: 26).  In this connection, it is not unnatural to encounter a question.   Were these clauses formulated from realist point of view? Or, did they involve a considerable degree of idealism?   These queries invoke the “realism versus idealism” debate in international relations (Daddow 2013: 70).  The heart of the debate can be effectively explained while analyzing the clauses of the treaty and the contentious issues of India and China.

Interestingly enough, disjuncture existed between clauses of the theory and the policy undertaken by the Indian Prime Minister Jawaharlal Nehru and Chinese premier Zhou EnLai. Neither party made any efforts to adhere to the clauses of the treaty.   Let us begin with the issue of territorial integrity. It will project the relevance of geopolitics and the realist quest for power. The MacMahon  Line demarcated the territorial frontiers of India and China.  The Indian authorities were confident that China would not have much problem in accepting it as the dividing line between the two neighbours.   However, the Chinese authorities expressed their aversion in recognizing it.   They advocated that the agreement was made when India was under the colonial rule. Therefore, it was impossible for the Chinese government to accord  formal  recognition  to  the MacMahon  line as  India emancipated  herself  from  the colonial regime. China also proclaimed that the treaty regarding Macmahon line was signed in 1914 between British India and local Tibetian authorities. Thus, she was not a party to the treaties (Jain 2004: 255; Panda 2003: 49). Hence, ambiguities remained over the Sino-Indian borders (Garver: 91). Both sides had their own viewpoints. Thus, congruency of opinion was hard  to  achieve.  After  repudiating the  MacMahon  line,  China  came up  with  a  different version of demarcating the borders. In 1959, the Chinese premier Zhou Enlai explained the Line of Actual Control (LOAC). He communicated this message to his Indian counterpart. Also, Zhou Enlai urged Nehru to follow the LOAC as the line that separates India from China. However, even this arrangement could not bring about any major breakthrough in resolving the boundary problem. The Indian authorities never had any authentic understanding about this arrangement. Moreover, Nehru was not proactive in settling the issue. It can be argued that China effectively exploited the geopolitical reasons for defending its stance during the 1962 Sino-Indian war. The Chinese forged the claim that India cared little for the LOAC and constructed 43 posts in Ladakh. This action was conceived by the Chinese as an intrusion into their territory (Panda 2003: 49).The construction of military basements along the MacMahon line by India was also taken up the China to accuse her neighbour for violating the borders (Rusko and Sasikumar 2007: 101). This stance of the Chinese government resembles the neo-realist logic.  This point deserves to be explained. As per the neorealist assumption, states act as self-help units by virtue of the anarchic nature of the international system.    There is a reason for such behaviour. States possess a suspicion that its adversaries might be taking measures to ensure their security and survival. In the parlance of international relations literature, this mindset is being defined as security dilemma (Weigall: 2002: 201).  China perceived that by disagreeing with the border issue, she kept her option open for exerting its claims over other disputed territories such as Arunachal Pradesh and Sikkim.  China perceived that accusing India on the MacMahon line would provide them with a greater bargaining power. In addition, this would also ensure their security. The actions of the Chinese state apparatus stood in sharp contradiction with the pillars of the Panchsheel treaty.  It violated the ideals of respect for sovereignty and territorial integrity of a country. The notion of peaceful coexistence failed to live up to the expectations Dutt 2007: 26). It contributes a great deal in proving that the Panchsheel was not being able to comply with the assumptions of either realism or neo-realism. To put it differently, it was idealistic in character. Likewise, the Indian government’s decision to provide asylum to Dalai Lama in Arunachal Pradesh in 1959 can be interpreted as another idealistic action.   India’s stance can be justified on the grounds of humanitarianism. Also, it touched upon the principle of conventional morality (Bandyopadhaya 2003: 76; Dutt 2007: 29). However, the Chinese response explicated the futility of moral action in international politics.  China’s perspective had  a  geopolitical  bend.  It  attempted  to  use  the  event  as  a  means  to  achieve  higher geopolitical goals.   By claiming Tawang district of Arunachal Pradesh as the birthplace of Dalai  Lama the seventh,  China  sent  a potential  warning to  India.    China always  had  a tendency to capture the geographically contiguous territories between herself and India. Its resentment during Sikkim’s merger with India in 1974 drives home this point. Thus, the inextricable link between geo-politics and realism can be traced.

The Loopholes in the Realist Viewpoint

Thus far, the paper has exemplified the manner through which the theoretical paradigms of neorealism have explained the geopolitical conflict between India and China. As per this school of thought, the urge to achieve power and security leads to perpetual conflict among states. Hence, any interaction between states results in a zero sum game. These claims can be barely contested.      Nevertheless,  the  realist  and  the  neorealist  logic  suffer  from  certain shortcomings.  First,  the  realist  scheme  of  arrangement  primarily stresses  the  domain  of politics and security. The political realm becomes the take-off point in their analysis. The argument of cooperation is treated as treated either a cliché or a as myth. Such a stance posits a substantial degree of absoluteness. As a consequence, it may provide a lopsided analysis. In this connection, a point needs to be invoked. We have mentioned in the preceding paragraph that China refuted the clauses pertaining to collaboration in the Panchsheel agreement. The realists associate a stereotype with the meaning of collaboration. It is being perceived only in terms of inter-ministerial dialogues. This conceptualization may appear to be monolithic in nature. Due to their negligence to the economic realm, the fail to believe that countries may work in a cooperative manner only when they have a common and not conflicting interest. In addition, it ought to be remembered that the economic domain of a state is as important as the political  one.  This  is  another  area  where  realism  fails  to  come  up  with  any  suitable justification. It has subordinated economics to politics. In this section, the paper seeks to forward an alternative analysis.  It tries to extrapolate that realists obsession with security has hindered them from exploring the logic of cooperation. In its response, the paper examines economic potential of the two countries. This serves two crucial purposes.  First, it facilitates in  unravelling  the  strategy of  economic  development  undertaken  by both  of  them.  This endeavour helps us to get a vivid description of the potential areas where India and China can possibly cooperate. It may further enhance the prospects of mutual gains for both. The article seeks to analyze this issue from the class perspective.

In terms of economic strategy, both India and China tried to adopt the socialist model of economic system (Nayar 1989: 123; Varsheny 1998: 33).   We begin with the development narratives of India. The colonial history of India played a pivotal role in shaping its development strategy. Since its emancipation from the British rule, Nehru felt the need for development in both agricultural and industrial sectors (Varshney 1998: 31). The political dynamics of the post Second World War (the Cold War) could not be avoided. India tried to mould its economic policy as per the existing norms of the bipolar scenario in international politics. On India’s part, she needed assistance from both the superpowers for her economic development. Hence, it adopted a balanced strategy to rebuild her economy.  Therefore, India was sensible for neither inclining with the United States nor with the erstwhile Soviet Union (USSR).  It can be argued that such a policy emanated from Nehru’s idea of Non-Alignment. The  existing  literature  on  the  subject  has  defined  the  policy  in  terms  of  realpolitik perspective.   However, this same doctrine can be explained from the economic perspective. How?  All the third world countries faced economic exploitation when they were being ruled by the  colonizers.  Economic  factors  provided  the  basic  stimulant  for  their  anti-colonial struggle.    Thus,  the  economic  sphere  became  the  linchpin  for  visualizing  the  political strategy. In a similar vein, it can be argued that Non-Alignment also had an economic vision. To put it differently, it had a political economic dimension. This is an area where realism has left a lot to be desired.   The realist explanation confines itself to the material domain. As previously mentioned, for them, material sphere focuses on issues geopolitics and military power. However, the paper tries to explain the “material dimension” in a nuanced manner. It must be remembered that India never hesitated to take economic help from the US and USSR (Mukherji 2014: 56).  Interestingly enough, they chalked out a unique strategy for their economy. This is known as the mixed economy. It refers to a form of economic system where both the capitalist and the socialist model would operate in unison. Undoubtedly, this path proved to be beneficial for the Indian economy. However, this is only a part of the entire story.  In order to encapsulate the dynamics of the Indian economic system, a subtle analysis is called for.   The Indian model highlights certain distinctive features. First, even though it pressed  for  heavy  industrialization,  India  was  mindful  to  restrict  the  dominance  of  the capitalist mode of production in the economy.  Secondly, it threw light on the idea of import substitution  industrialization  (ISI).  It  underlined  the  need  to  restrict  imports  thereby minimizing the dependence on foreign capital. On the other hand, it stressed the need to augment domestic production. The idea of self-reliance was embedded in the logic of ISI (Mukherji 2007: 5).    In the first three decades of Indian planning, India was hesitant in allowing the free play of foreign capital. It was more eager to give the indigenous industrialist enough  leverage  for  the  industrial  growth  of  the  country.        The  introduction  of  the Monopolies and Restrictive Trade Practices Act (MRTP) of 1969 and the License Raj (Mukherji 2007: 9) could be cited as evidences.   In this connection, an important question needs to be asked. In what manner did the MRTP act revealed the logic of the socialistic pattern of economic growth which India was trying to promote?     In response to this interrogation,  a  vital  point  shall  be  noted.  Although  MRTP  was  initiated  to  curb  the capitalistic influence into the Indian economy, it ended up in nurturing a domestic dominant class whose interest was identical to that of the capitalist class. Most importantly, this group also succeeded in securing the support of the political masters.


In order to describe this phenomenon, Pranab Bardhan (2012: 42, 54) coined a term– the dominant  coalition.  It  referred  to  three  groups,  namely  –  the  industrial  class,  the  rich peasantry and the bureaucratic/technocratic class. Not only did they share an interdependent relationships but also operated in a unified fashion. A harmony of interest existed among


them.     All these groups played a key role in determining the economic policies of the government in an indirect manner. This point need to be substantiated. The business lobby used to pressurize the governments for obtaining licences. On many occasions, they resorted to unfair means to achieve their ends. Likewise, the peasants lobby often flexed their muscles in their efforts to secure subsidies. Finally, the bureaucrats bargained with the government on numerous issues.  The intensity of the demands of these lobbies was such that the government never had much choice but to comply with them. Thus, the norms of the MRTP Act were used as means by the members of the dominant coalition for promoting their objectives. Therefore, it can be argued that the socialistic planning model sowed the seed for the growth of capitalism. The Indian state wanted to control the commanding heights of the economy (Rudolph  and  Rudolph  1987:  212).    There  is  rationale  behind  this  protectionist  line  of thought. The government felt that the domestic industries needed to be properly nurtured before they became well-equipped to face the challenges posed by the foreign industrial states. The Indian state viewed that by doing so, the foreign capitalist influences could be checked and the potential of the mixed economic pattern would be realized. Unfortunately, this vision could not materialize. The ‘mixed economy’ provided the ideal foundation for the emergence of the capitalistic trends in the economy.   Eventually, India opened itself to the world economy in 1991 by initiating a set of reforms (Ghosh and Chandrasekhar 2000: 31). The paper shall discuss its move towards economic reforms later. Now, we will portray a detailed discussion of the Chinese economy during its formative years since 1949. This will provide an opportunity for getting a comparative picture of the economy of both countries in the pre-liberalization phase (Mukherji 2014: 9). China also made conscious effort to implement a socialist model in their economic development. Opposition to the capitalist pattern of economy was the main reason behind choosing this  path.    Both  Chinese and  Indian  economy shared  a common  feature.  The economy was primarily agrarian in character.     However, this does not imply that China overlooked the case of industrialization.  It tired to give equal emphasis on both the sectors. China had to face the twin problem of lack of cultivable land and limited industrial development. In its quest to follow the line of socialism, the Chinese Communist Party (CCP) undertook certain necessary measures. It ensured governmental control over the key sectors of the economy.  The nationalization of the industry and the elimination of the private sector could be cited as classic illustrations.  In addition, the process of land reforms was prompt. It attempted to do away with the landed class and endorsed the case of equitable redistribution of land among the common masses (McWilliams and Piotrowski 2005: 354).    The path towards socialism was not devoid of ideological contradictions.   This does not indicate that socialism had to face opposition from any diametrically opposite ideology.   In the Chinese context, a different version of the leftist ideology was gradually trying to make its mark in defining the political economic trajectory of the country. Mao Zedong envisaged an alternative explanation of the socialistic ideology. Till then, China had been following the Soviet style of socialism. However, Mao was sceptical about the prospects of the socialistic system inspired on the lines of the Soviet Union.  He believed that institutionalizing  the  Soviet  system  possess  the  risk  of  over-bureaucratization.  Such  a structure might posses the risk of exploitation of the masses. This would definitely impede the emancipation of the masses. Thus, Mao envisioned the need for channelizing the energy of the masses in an effective way in agricultural and the industrial arena. This strategy was popularly known as the ‘Great Leap Forward’ (1957) (McWilliams and Piotroski 2005:355). At the heart of this project laid the intention for rapid industrialization.   Mao encouraged the process of mass mobilization of the masses from agricultural collectives into large communes for refashioning the industrial activities on a massive scale. Unfortunately for Mao, this method failed to live up to its expectations. In addition, Soviet Union was upset with Mao’s approach. It became prominent when USSR suspended all forms of economic and technological assistance to China (Mansbach and Taylor 2014: 166).     This is the broad historiography of the Chinese economic development during its first two decades. The path of socialism had certain inherent problems. Hence, these events paved the ground for China to detach itself from the socialistic vision. The blueprint of economic development of India and China is more different and less similar. Despite visualizing socialism as the cornerstone of their developmental strategy, both of them failed to execute their plans in a manner that would have brightened chances for realizing its meaning both in letter and spirit.  In the Indian case, it can be claimed that mixed pattern was distantly related to socialist notion of egalitarianism. The Indian planners failed to realize that capitalist tendencies penetrated the economy even during the heydays of socialism.  The capitalist classes of India cared little for the development of the country. On the contrary, they were focussed on fulfilling their own individual goals. Capitalism failed to generate the desired level of economic growth. They misused the support rendered to them by the government.   Hence, India’s step of opening up of the economy to invite foreign capital can be attributed to the failure of its domestic capitalist class.   The story of China is different. They were more rigid as compared to India when it came in tackling the forces of capitalism. China opted for capitalist development only when Mao’s policy proved to be futile. In the pre Deng Xiaoping period, the presence of capitalists influence could not be traced. Also, the timing  of  liberalizing  the  economy  of  both  India  and  China  deserves  to  be  critically examined. It will provide a clear idea regarding the existing configuration of international politics.

The Political Economy of Liberalization and Sino-Indian Cooperation

In the 1980’s Margaret Thatcher elaborated the benefits that a country could enjoy through liberalization of it economy.   The prevailing scenario of world politics at that point of time also helped to popularize the idea.   In this context, the respective perceptions of India and China about political configurations during the closing stages of the Cold War ought to be elaborated. The Sino-Soviet relationship received a major setback after the 1969 Ussuri river conflict (Bannerjee 2010: 71).  At that point of time, the economy of the United States (U.S) manifested an upward trend of growth. Moreover, China was in search of finance and technology to carry out its process of industrialization. Against this backdrop, aligning with the United States was a plausible option. Therefore, the Chinese tilt towards the capitalist market forces became obvious. These thoughts found expression through Deng Xiaoping’s economic policy in the early 1980s (Mansbach and Taylor 2014: 167). India’s case was slightly different. India opted for liberal economic measures in the 1990s, a decade later than China. Question can be raised as to why India waited till 1990 to open up its economy? India’s  pursuance  of  the  non-aligned  policy has  already been  dealt  with.  Moreover,  its relation with the United States was not as cordial as it was with the Soviet Union. Hence, it had  little  availability  of  options.  Two  issues  gave  impetus  to  the  process  of  economic reforms. First, the Soviet model gradually lost its appeal among the policy makers. Secondly, two concurrent events took place – the disintegration of the Soviet Union and the rise of United States politically as well as economically.   Also, India observed that China and the East Asian counties have economically prospered after adopting a liberal economic approach. Let us now enunciate the key features of economic liberalization of both these countries. Let us explore the series of reforms which Deng Xiaoping initiated in the Chinese economy. He highlighted four key features – agriculture, industry, science and technology (McWilliams and  Piotrowski  2005:  365).  Deng  Xiaoping’s  approach  marked  a  shift  from  socialist perspective of self-sufficient economy. On the contrary, it underlined the notion of export-led growth. In other words, promotion of exports received greater priority. Besides, China welcomed the entry of foreign direct investment into their economy. Its growth rate revealed positive signals. The percentage of capital inflows also plummeted (Mansbach and Taylor 2014: 167; Nayar 2005: 184,185).   Thus, economic stance of China took a paradigm shift. The Indian strive towards economic reforms got underway with the revoking of the MRTP Act. The stringent regulatory mechanism of the economy was relaxed. The deregulation of the economy aimed to attract foreign capital.    India consciously made efforts to promote exports as it faced serious balance of payment crises (Ghosh and Chandrasekhar 2000: 128). The withdrawal of the Foreign Exchange Regulation Act (FERA) could be cited as a classic example (Mukherji 2014: 20). India was equally mindful of removing the barriers to trade (tariff and other related trade barriers) (Mukherji 2014:17). In the preceding paragraph, we have delineated the interface of the economies of India and China with the forces of capitalism. The 1990s witnessed the phenomenon of globalization with  greater  intensity.  Neither  India  nor  China  could  deny it.  Both  countries  faced  the economic consequences of globalization. In this context, a question becomes inevitable in the post cold war scenario. What has been the impact of globalization on the state machinery of these countries?    For tackling this query, we will have to take recourse to the theoretical debates that explore the ramifications of globalizing tendencies on the state. This exercise would help us to get a detailed picture of the existing equations in international political economy.   We can then refer to its arguments in the context of economic relations between India and China.

It  has  to  be  admitted  that  the  existing literature  on  globalization  is  being riddled  with competing explanation. As per one school of thought, states are no longer relevant in the globalized era. The market forces have become more powerful vis-a-vis states. Globalization has resulted into a borderless world (Ohmae 2005: 20). However, such radical viewpoint have been countered by an different stance claiming that states are controlling the market forces (Hirst and Thompson 2000: 79).  However, these notions seems to be too absolutist in character. We need to take a subtle approach in our analysis. In a similar vein, the paper tries to argue that neither states nor markets shall be viewed as antagonistic entities (Rodrik 2009:264).  Conceiving their interaction as a zero sum game may not be desirable.   Both entities have many positives to offer to one another. Also, globalization has underlined the case of interdependence among various actors in the international forum (Keohane and Nye 2001: 21). States and markets can operate in a complementary manner. Hence, states have not become redundant in the global age. They still possess substantial degree of significance. However, it ought to be acknowledged that an alteration have taken place in the functioning of states.  The meaning of this statement requires some elaboration. It does not imply that the traditional functions of states have been replaced by new responsibilities.  On the contrary, it seeks to convey the idea that states have taken up certain new functions alongside their conventional ones.   The operational dynamics of states have undergone a transformation in order to meet the exigencies of the globalizing agents (Shaw 1997: 498; Sassen 2003: 7, 10). States have to be proactive while responding to the political economy of globalization. An efficient state will certainly be able to reap greater benefits of the globalizing process. To put it differently, state acts as a catalyst or a facilitator globalization. These arguments can be used to elucidate the position of India and China. Both states have understood that the influx of capitalist trends would be positive for their economic growth and development. Hence, it can be argued that India and China shares congruence of interest. They can act in an interdependent  manner.    However,  this  concept  needs  to  be  critically  discussed  as  the dynamic of globalization has thrown up several unavoidable challenges. Let us first explain the conventional idea of interdependence. It emphasizes the case for cooperation among countries. Secondly, it forwards the concept of multiple channels of cooperation among nations. It implies that alongside states, non-state actors play an equally instrumental role in determining the contours of international outcomes (Keohane and Nye 2001: 22).       The emergence of multinational corporations (MNCs) (Evans and Mooney 2007: 236) can be cited to drive home this claim.  These entities have forwarded an alternative understanding of interaction among states.    In the contemporary era, interactions are not  longer restricted within the ministerial level. In other words, intergovernmental exchanges have been complemented by collaboration between multinational firms and the higher echelons of the governmental authority. In addition, agreements among the MNCs are becoming a common practice.  Therefore, in the contemporary scenario, we witness state-firm diplomacy as well as firm-firm diplomacy (Strange 1992: 10, 11). Interdependence has posed a potential challenge to the certain core assumptions of classical realism (Morgenthau 1948: 4).   First, the relationship between power and politics has been reversed.    The relevance of economics in defining the parameters of power has received importance. As a consequence, the stereotypes about the prioritization of military power by states began to be revisited. This practice has spelled an important transformation in approaching international politics.   States have shifted their focus from acquiring political power to gaining economic power (Strange 2000: 149).    Geo-economics is becoming an increasingly popular policy option among states. This has strengthened the logic of cooperation.      Hence,  India  and  China  have  revealed  the  urge  to  promote  bilateral collaborative measures in the contemporary era.  The paper seeks to  elaborate the policy stance of India and China through the help of empirical evidences. Before we undertake this task, it is pertinent to explicate an issue. It has been observed that both parties have shown an urgency to try and resolve disputes over certain geographical territories so that economic relations between the two countries remain unhindered.  The Nathula pass in Sikkim is an important trade route for both these countries (Hence, with realization of the potential benefits of trade, China has moved away from making any claims on the Indian territory of Sikkim. Such behaviour was unthinkable during the Cold War era) (Rusko and Sasikumar 2007: 114). The opening up of the border trade route at Lipulekh in 1991  was  the  first  major  positive  signals  for  the  improvement  of  the  trading  relations. Another major breakthrough came in 1993 when both parties agreed to conduct trade through the Shipki La pass (Mansingh 1994: 292). On the economic front, both countries have shown keenness to export a variety of goods with one another.   The trade across the Sino-Indian borders are being carried out primarily through the Kolkata Port and the Chinese port at Shanghai. It must be notified that certain regions of India and China have played a key role in facilitating the intensity of trade. The Indian North Eastern regions and the South Western part of the Chinese landmass have been the prime trading zones (Karackattu 2013: 694). This rapid growth in trade can have a positive effect in the overall development of these two regions.   There is rationale for making this statement. As both countries are interested in trading relations, they will naturally be eager to develop those areas from where the bulk of the trade takes place (Karackattu 2013: 705).

The narratives on India-China trade have often argued the issue of asymmetry. It implies that levels of trade are higher for China as compared to India. It has often been argued that China exports more goods to India than the latter does it to its neighbours. Although this is not entirely incorrect, however, in a cooperative set up we should always try and focus on the concept of absolute gains rather than relative gains (Grififths, O’Callaghan and Roach 2015: 306,307). It is undeniable that China is economically powerful than India. Nevertheless, the logic of liberal trade provides an opportunity for both of them to improve in the economic domain.   India and China has been emphasising on intra-industry as well as inter-industry trade.  The latter pattern of trade has a larger share than intra-industry trade. Inter-industry trade  can  occur  in  sectors  such  as  electronic  goods,  textiles  and  merchandise  products. Chinese export of the merchandise product has recorded a growth rate of 44% in the first decade after the conclusion of the Cold War (Devadason 2012: 60).   On the other hand, Indian  exports  to  China  comprise  mainly of  cotton  yarns,  iron  ore,  steel,  plastic  goods (Devadason 2012: 64) and pharmaceuticals (Boillot and Labbouz 2006: 2899). On certain occasions, India has overshadowed China in terms of growth of exports. In 2004, India’s export grew as high as 80.5 % viz-a-viz the Chinese progress of 77.2 % (Acharya 2005: 1423). Therefore, both nations have taken steps to operate in tandem for furthering the cause of their economy. It becomes evident as the state owned oil companies of India and China, Oil and natural Gas Corporation (ONGC) and the Chinese National Petroleum Corporation (CNPC) respectively jointly won a bid for acquiring 37% stake of Petro-Canada in the oilfields of Syria (Zhu 2011: 5).   There are plenty of areas where China and India can work in joint venture. In addition, the economic forces of India and China can complement one another. India’s ever increasing forces of skilled labour force has greater appreciation in the Chinese circle. The car parts, cell phones and the computer codes for digital television for the Chinese factories are designed by the Indian engineers (Devadason 2012: 73). The Information technology sector also stands out as a classic illustration (Boillot and Labbouz 2006: 2899). Leading  Indian  companies  such  as  Infosys,  Wipro  and  Birlas  also  operates  in  China. Likewise, the Chinese influence on the Indian economy shall not be overlooked. Around 35% of the power plants in India are being manufactured by the Chinese companies. The shares of Chinese Telecom companies are also somewhat similar (Mukherji 2014: 86). The growth and consolidation of the Sino-Indian economic ties will help to materialize the vision of the free trade area (FTA) between them (Acharya 2005: 1424).

Concluding Observations

The paper has figured out those issues in Sino-Indian relations where cooperative action can be possible from sides. In this endeavour, it has performed an important task.   The article seeks to promote the idea that issues which had been viewed through the prism of realism can also be studied from the perspective of liberalism. Hence, attempt has been to chalk out the deficiencies of the realist logic. Secondly, in order to substantiate the case for economic cooperation between India and China, the paper has undertaken an evolutionary approach of traversing the historical trajectories of the political economy of development in these two countries. Such line of thinking has provided to establish the rationale for liberalizing their economy. Also, it indicates  the relevance of economic interdependence between the two countries. The article has effectively encapsulated the significance of geo-economics and the possibility of  a  win-win  situation  which  may  usher  in  between  India  and  China  in  the contemporary context. Although the paper has explained the dynamics of India-China cooperation through theoretical means, it has also given ample empirical evidences in support of its theoretical standpoint. The paper foresees that the spirit of collaboration will be the theme for Sino-Indian relations in 2015 and thereafter.


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Professor Radharaman Chakrabarti

Former Director, Netaji Institute of Asian Studies, Kolkata and Former Vice-Chancellor, Netaji Subhash Open University, Kolkata



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Professor Alka Acharya

Professor, Centre for East Asian Studies, School of International Studies


Professor Dipankar Sinha

Professor, Department of Political Science, University of Calcutta


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