In late October 2024, India and China made a cautious but significant move to de-escalate their ongoing border dispute along the Line of Actual Control (LAC), their longstanding, loosely defined boundary. The two countries announced they would pull troops back, dismantle temporary infrastructure, and resume pre-2020 patrols in contested areas like Depsang and Demchok in eastern Ladakh. While the agreement represents a diplomatic success, it does not fully address the deeply rooted strategic mistrust and competition between the two powers. This tentative détente, driven by practical needs, underscores a complex balance of regional interests, economic pragmatism, and a shared awareness of the risks involved in allowing border tensions to spiral.
Historical Tensions
The border between India and China has been a source of friction since the 1962 Sino-Indian War, when unresolved boundary lines crystallized into animosity, especially along the LAC. The border dispute, a legacy of colonial-era boundary decisions, has remained unresolved despite decades of diplomacy. Since then, the two countries have experienced sporadic skirmishes, the most severe of which occurred in June 2020 in the Galwan Valley. That clash, which resulted in the deaths of 20 Indian and at least four Chinese soldiers, represented the first fatal border conflict in over 40 years and marked a dramatic escalation in hostilities. The use of hand-to-hand combat, in line with a 1996 agreement prohibiting firearms in these disputed zones, underscored the fragility of peace.
Following the 2020 clash, India responded by increasing scrutiny of Chinese investments, banning major Chinese apps such as TikTok, and halting direct flights between the two countries. China, for its part, fortified infrastructure near the border, constructing villages and enhancing logistical capabilities, especially in areas close to the southwestern border with Bhutan, Nepal, and India. This mutual escalation in both infrastructure and military presence cemented a “new normal” along the LAC, leading both sides to perceive increased risks of clashes and a heightened need for diplomatic management.
The Recent China-India Border Agreement
The October 2024 agreement between India and China reestablishes pre-2020 patrolling rights in the strategic regions of Depsang and Demchok. The two countries have agreed to limit the number of troops on patrol, stagger patrol schedules, and closely monitor patrols to prevent direct face-offs. These areas are significant for their strategic proximity to military assets and infrastructure, such as India’s Daulat Beg Oldi military base, one of the highest airstrips in the world. This base sits at the critical intersection between China’s Xinjiang region and India’s territory in eastern Ladakh, making it a vital location for India’s defense posture.
The timing of the agreement, on the eve of the October BRICS summit in Russia, suggests that both nations had pragmatic reasons to seek a temporary peace. For China, easing border tensions with India might alleviate some of the economic and diplomatic pressure it faces due to a slowing domestic economy, real-estate challenges, and restrictions on Chinese goods in the West. By improving relations with India, China may hope to prevent New Delhi from imposing further restrictions on Chinese investments or tightening existing policies. From India’s perspective, a stabilized border frees up resources to focus on economic growth, especially as corporate players like the Adani Group advocate for a moderated stance on Chinese capital and technology that could support India’s growing manufacturing ambitions.
Despite ongoing security concerns, economic interactions between India and China remain strong. China is India’s largest trading partner, and trade between the two countries surged from $65 billion in 2020 to over $118 billion in 2024. India relies on Chinese imports for industrial goods, electronics, machinery, and pharmaceuticals, highlighting an interdependence that complicates outright rivalry. Indian businesses, especially those in sectors reliant on Chinese technology or goods, are urging the government to ease restrictions, arguing that Chinese investments and partnerships could play a key role in expanding India’s manufacturing sector and enhancing its position in global supply chains.
However, India’s government remains cautious. Finance Minister Nirmala Sitharaman recently remarked that while foreign investment is essential, the country must carefully consider the sources of that investment. This stance reflects a larger strategic caution: while India may open up to selective Chinese investments, particularly in sectors that benefit its economy, it remains wary of dependence on Chinese capital in critical areas like infrastructure, telecommunications, and defense.
Strategic Autonomy and the Washington Factor
India’s careful engagement with China raises important questions about its relationship with the United States, which views New Delhi as a potential counterbalance to China’s growing influence in Asia. Since the early 2000s, the US-India partnership has deepened, particularly in defense, technology, and economic arenas. India’s participation in initiatives like the Quad, along with close cooperation on defense matters, reflects shared concerns over China’s regional assertiveness. However, India’s long-held doctrine of “strategic autonomy” prevents it from aligning fully with any single global power, instead preferring to operate within a multipolar framework.
This approach allows India to maintain relationships with diverse partners, including those with opposing interests, such as China and the United States. Foreign Minister S. Jaishankar encapsulated this sentiment when he described India as “non-West and not anti-West.” This strategic autonomy echoes India’s Cold War-era policy of non-alignment, a stance that allows New Delhi to cultivate relationships with both Western countries and its traditional partners, such as Russia and members of the Shanghai Cooperation Organization (SCO). For instance, India’s recent acquisition of unmanned combat aerial vehicles (UCAVs) from the United States reflects its efforts to enhance security along both its land and maritime borders, where China’s influence is steadily expanding. For the U.S., India’s nuanced approach means respecting New Delhi’s independent path, even as Washington continues to engage with India as a pivotal partner in the Indo-Pacific.
Infrastructure Buildup and Cyber Tensions
While diplomatic gestures like the recent border agreement are encouraging, they don’t fully address the underlying mistrust that drives India-China relations. Both countries continue to expand their military infrastructure along the LAC, constructing roads, bases, and logistical networks that enable quick troop deployments to contested areas. China’s construction of new villages and military posts near the border aligns with its “dual-use” infrastructure strategy, where civilian facilities can also support military objectives. India, too, has responded with projects like the Sela Tunnel, which provides year-round access to its northeastern border regions, and by reinforcing its road networks in the area.
Cyber operations add another layer of complexity to this rivalry. In recent years, China-linked hackers have targeted critical sectors in India, including its power grid, particularly during high-tension periods like the 2020 clash. Although these cyber incursions seem more focused on intelligence gathering than disruption, they highlight vulnerabilities that could be exploited in future confrontations. If tensions escalate, cyber operations could disrupt essential infrastructure, affecting regions far beyond the border areas and complicating India’s security calculus.
Temporary Calm amid Enduring Strategic Competition
Thus, the India-China border agreement represents a pragmatic effort to lower the risk of immediate conflict, but it does not eliminate underlying tensions between the two states. Small diplomatic steps, like resuming direct flights and easing visa restrictions, may improve relations incrementally, but a true reset appears unlikely. China remains wary of India’s growing cooperation with the West, particularly with the United States, while India views China’s influence in South Asia and the Indo-Pacific with caution. The two nations’ divergent visions for regional leadership, combined with India’s aspirations for global recognition and China’s pursuit of influence in the Global South, make a comprehensive reconciliation difficult.
In this complicated setting, India is likely to continue its strategy of balanced engagement with China while strengthening its partnerships with Western allies, particularly the United States. India’s commitment to strategic autonomy means it will remain flexible, working with China when practical and with the U.S. when necessary. For Washington, recognizing India’s independent approach will be crucial, as New Delhi will likely remain a key but autonomous player in the broader effort to counterbalance China’s influence in Asia.
India-China relations will likely continue to oscillate between periods of pragmatism and rivalry. While economic and diplomatic gestures can foster a temporary calm, the deeper strategic calculations and unresolved border issues suggest that Asia’s two largest nations will continue to navigate a delicate and often uneasy coexistence.
