Is INDIA a threat for CHINA?

Your 5-minute weekly dose of geopolitics in a straight-to-the-point and illustrated format. Enjoy!

I) India competes more and more with China in the economic and geopolitical realms

A. India’s economic power on the verge of outshining China?

India’s 7% GDP annual growth is bolstered by its young, cheap and numerous workforce as well as by its attractiveness for private foreign capital. As a matter of fact, since 2017, Apple and Foxconn are relocating parts of the iPhone’s supply chains from China to India. The latter is particularly competitive on the international stage when it comes to its IT sector, pharmaceutical industry and its banking sector with the development of financial technologies like the Unified Payments Interface (UPI).

B. India affirms its strategic ambitions on the global stage

India is expanding its influence abroad, notably in Africa where it is investing in development projects and establishing strategic partnerships. It is for instance posting defence attachés in various African countries like Ethiopia (where the African Union’s headquarters are located) and Djibouti. Moreover, India leverages the presence of its diaspora in Eastern and Southern Africa in order to forge strong business connections with the continent.

India’s ambitions are also particularly visible in its promotion of the India-Middle East-Europe Economic Corridor (IMEC), which was launched in 2023 as a counterproposal to China’s Belt and Road Initiative (BRI). India is also playing a strategic role in energy connectivity, supporting the development of the International North–South Transport Corridor (NSTC) that links Russia to India through Iran and Azerbaijan.

Furthermore, from a military perspective, India has undertaken ambitious modernisation reforms under the leadership of Narendra Modhi. As a consequence, it is now the largest arms importer in world.

II) However, India remains far from matching China’s power and seems to prefer cooperation to confrontation

A. So far, India is still lagging behind China

In 2023, China’s GDP was around 6 times greater than that of India, the latter ranking only the 5th in the world. Besides, India’s workforce is not yet on a par with China’s partly due the low economic integration of women and the weaknesses of its education system.

Furthermore, with regards to military spendings, Chinese defence budget for 2025 reaches $245bn, more than 3 times higher than the Indian defence budget of $79bn. As a matter of fact, the difference may be even larger since official figures communicated by China probably only represent a fraction Chinese investments in defence and security. Such a gap between the two neighbours explains why Chinese technological and military capabilities far exceeds that of India, particularly when it comes to the space industry and the development of hypersonic missiles.

B. India does not want to antagonise its Chinese neighbour

Rather than joining rigid alliances, India maintains a pragmatic multi-alignment strategy that allows it to cooperate on an ad hoc basis with many different powers according to its own interests. When it comes to China, India’s foreign policy takes deliberate caution and avoids antagonising it. While it strengthens ties with Western countries through mechanisms like the Quadrilateral Security Dialogue (QUAD), India simultaneously preserves its ties with China in multilateral forums such as the BRICS and the Shanghai Cooperation Organisation (SCO).

Besides, after a resumption of tensions along their common border in the Himalaya in 2020, India and China signed an agreement in October 2024 to appease their relation and conduct joint patrols in the region of Ladakh.