A US-China Cold War could help deepen the US-India strategic partnership as both wish to counter China’s imperialism in Asia

The main strategic theatre of the US-China new Cold War is Asia. Economics and strategy are linked for both China and the US – and India. Authoritarian China’s astonishing economic and technological advance accounts for the worldwide spread of its Belt and Road Initiative, its growing military power and aggressive challenge to America’s primacy in Asia and to the state borders of India and other neighbours.

Ideological competition also characterises the new Cold War. President Xi has boasted about the merits of single-party communist rule in China, but President Biden is determined that the democratic US will stand its ground and confront autocratic China’s attempts to gain regional and world ascendancy. Biden’s determination may be good news for India, which needs strong friends against China. He wants the US and its partners in the Quad – Australia, India and Japan – to hold an expansionist China “accountable” in Asia.

A US-China Cold War could help deepen the US-India strategic partnership as both wish to counter China’s imperialism in Asia. The recent disengagement accord on Ladakh is not synonymous with the disappearance of China’s threat to India. So news about logistical security agreements and the recent joint India-US military drills in the Indian Ocean is good news.

Some factors make the US-China Cold War different from the US-Soviet one, creating strategic conundrums for India. First, neither the former USSR nor the US shared a border with non-aligned India or laid claim to its territory. India could therefore receive large Soviet and American investments, especially in its public sector, with confidence. In contrast, one of the antagonists in the new Cold War, China, contests India’s north-eastern border and is a territorial spoiler in South and Southeast Asia. That also makes it a threat to America’s pre-eminence in Asia and encourages closer strategic collaboration between India and the US.

Additionally, unlike the economically weak Soviet Union, China’s progress has made it a global economic hub and one of the largest trading and investment partners of many countries, including India, even as it threatens India’s state frontiers. Since last June’s border clashes, New Delhi has imposed restrictions on Chinese investment in India.

However, the year 2020 saw India trading more with China than with the US, despite the skirmishes in Ladakh and economic hardships created by the corona pandemic. India’s trade with China stood at $77 billion; with the US at $75.9 billion. Meanwhile, sticking points remain in India’s economic tie with a friendly America. For example, to Washington’s chagrin, the annual raising of import tariffs by the Modi government and its digital services tax has led the US to consider retaliatory tariffs of up to 25% on Indian goods ranging from shrimps to gold.

The imbalance of power between India and China is in the latter’s favour. Over the last two decades the Indo-US strategic tie has become stronger but question marks hover over Washington’s expectations of India partly because of its non-alignment, partly because of its close military ties with Russia. Since the 1970s authoritarian Russia, which is America’s ‘other’ antagonist, has been India’s top arms retailer. But does Washington really expect New Delhi to relinquish its Russian defence card, which strengthens India against China, unless it offers something comparable in return? In any case, India’s need for more economic and technological support highlights its wish for strategic autonomy and diversification of supplies.

Biden will be more receptive than President Trump to the views of America’s allies and partners. But defence secretary Lloyd Austin’s visit to India in mid-March revealed that American sanctions against India for buying Russia’s S-400 missile were not discussed because India has yet to acquire the system. His statement implied that the possible imposition of sanctions on India remains on Washington’s agenda.

At another level, Biden insists that democracy and concern for human rights must shape the world. Unlike New Delhi, he admits that the US doesn’t always live up to its own expectations. But he has stressed that its society is upheld by democratic norms and practices which his government intends to strengthen domestically and internationally.

The issues of democracy and human rights came up in New Delhi during Austin’s talks with Cabinet ministers – though not with PM Modi. New Delhi has remained silent on the talks. The public has only Austin’s statement at a press conference on these parleys. He explained that partners could make progress on “such issues” through meaningful discussions. That is important to the Biden administration which sees the US-China conflict as one about the utility of democracies or autocracies in the 21st century. Democratic states must prove that democracy works. India has yet to react to these ideas publicly.

India should deal adroitly with a situation in which it relies militarily, in different ways, on the US and Russia. Meanwhile, a belligerent China is India’s largest trading partner. America is the largest single market for Indian exports, but it criticises what it sees as India’s protectionist economic policy. As India’s main strategic helper the US encourages New Delhi to play a larger role in Asia. Neither wants a bellicose, expansionist China to gain the advantage in the new Cold War.

Sooner rather than later, India and the US must smooth the path they want to follow together with a view to countering China’s expansionism in Asia and its threat to India’s territorial integrity.