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India, China Hoping to 'Reshape the World Order' Together

Once-Hostile Giants Sign Accords on Border Talks, Economic Ties, Trade and Technology

By John Lancaster
Washington Post Foreign Service
Tuesday, April 12, 2005; Page A16

NEW DELHI, April 11 -- India and China announced a new "strategic partnership" Monday, pledging to resolve long-standing border disputes and boost trade and economic cooperation between two rising powers that together account for more than a third of the world's population.

The announcement came after a summit between Indian Prime Minister Manmohan Singh and his Chinese counterpart, Wen Jiabao, who began a four-day visit to India with a weekend stop in Bangalore, the center of India's booming information-technology sector.

Indian Prime Minister Manmohan Singh, left, and Chinese Premier Wen Jiabao applaud at an appearance in New Delhi during Wen's four-day visit to India. The leaders said their countries, once adversaries, were now partners. (B. Mathur -- Reuters)

The agreements signed Monday mark an important shift in relations between the Asian giants, which fought a brief border war in 1962 and have long regarded each other with suspicion. The prospect of a more cooperative relationship has significant global implications, given the vast economic potential of India and China and their voracious appetites for energy and other natural resources.

"India and China can together reshape the world order," Singh said at a ceremony welcoming Wen to India's presidential palace.

On a practical level, the two governments agreed to a framework for addressing long-standing differences over their 2,175-mile border, promising to resolve the dispute through "peaceful and friendly consultations." They also signed agreements on trade, economic cooperation, technology sharing, civil aviation and other matters.

As a goodwill gesture, China formally abandoned its claim to the tiny Himalayan province of Sikkim, presenting Indian officials with a map showing the area as part of India. Chinese officials also delighted their hosts by pledging explicitly, and for the first time, to support India's bid for a permanent seat on the U.N. Security Council, Indian and Chinese officials said.

"There is a raising of the level of the relationship between the two countries," India's foreign secretary, Shyam Saran, said at a news conference Monday afternoon. "We do not look upon each other as adversaries but we look upon each other as partners."

India's differences with China go back decades. In 1962, the countries fought the brief border war that China is generally acknowledged to have won. India has long been wary of China's close ties to India's neighbor and arch rival Pakistan. But in recent years, India and China have begun to draw closer, recognizing their common interest in trade, regional stability and, more recently, containing the threat of Islamic extremism.

In 2003, Atal Bihari Vajpayee, then India's prime minister, pledged during a visit to Beijing to respect China's sovereignty over Tibet and not to allow "anti-China political activities" in India, a reference to the Tibetan government-in-exile in Dharmsala, led by the Dalai Lama. That commitment was reiterated in the joint declaration on Monday.

"The two sides agreed that India-China relations have now acquired a global and strategic character," the statement said. It also said both governments had agreed to establish a "strategic and cooperative partnership for peace and prosperity."

In the short term, the most significant of the agreements signed Monday calls for resolving the border dispute on the basis of historical records, geography, security needs and the interests of people who live in the area, among other factors. Indian officials acknowledged that resolution of the issue was some years off.

In geopolitical terms, the consequences of a rapprochement between the world's two most populous countries could be profound. "In the same way that commentators refer to the 1900s as the American Century, the early 21st century may be seen as the time when some in the developing world, led by India and China, come into their own," said a December 2004 study by the U.S. National Intelligence Council.

Such "arriviste" powers, the study noted, "could usher in a new set of international alignments, potentially marking a definitive break with some of the post-World War II institutions and practices." The report also said that India "could emerge as the world's fastest-growing economy" by 2020, overtaking China.

In pursuing closer ties, each country is clearly eager to capitalize on the other's economic strengths -- manufacturing and computer hardware in China, services and software in India -- while boosting trade that by all accounts has remained far below its potential. Last year, trade between the two countries came to $13.6 billion, compared with about $20 billion between India and the United States. India and China pledged Monday to boost their trade to $20 billion by 2008.

"If India and China cooperate in the IT industry, we will be able to lead the world," Wen said in Bangalore on Sunday. "It will signify the coming of the Asian century in the IT industry."

Economic motives aside, China also wants better relations with India because it is competing for influence in New Delhi with the United States, which was several years ahead of Beijing in recognizing India's potential as a military and economic power and has greatly increased its cooperation with India in both spheres.

This week alone, India's foreign minister, Natwar Singh, will travel to Washington for meetings, while two senior U.S. officials -- Adm. William J. Fallon, commander of the U.S. Pacific Command, and Transportation Secretary Norman Y. Mineta -- will be visiting the Indian capital.

"Everybody started talking about the rise of China a long time ago, and now they're talking about the rise of India, so I think there's a shared sense that something terribly important is now happening," said Vinod C. Khanna, a former Indian diplomat who served in China and once ran the East Asia division of the Indian Foreign Ministry.

Khanna added, "If you had asked me in 2001 if this was where we'd be in 2005, I would have said, 'That's terrific, but aren't you being overoptimistic?' "

Special correspondent Rama Lakshmi contributed to this report.

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