Not long ago, India became the world's fifth-largest economy after overtaking Britain and is expected to overtake fourth-largest Germany within three years. Furthermore, the United Nations considers that India has just surpassed China in population. If true, it would be the first time in at least three centuries that China is no longer the most populous country on the planet.
In such circumstances, will the next twenty-five years belong to India, just as the last twenty-five have witnessed the spectacular rise of China?
Before examining this question, an important reservation must be made. It is difficult to predict the trajectory of any country because history rarely moves in a linear fashion. However, it is always tempting for analysts to make long-term linear projections based on current trends.
In the 1980s, for example, the US's main concern was that a rapidly rising Japan would threaten its industrial might. A feeling against Japan then emerged, which even received attacks in the same way that today the obsession is with China. There were American economists who predicted in 1991 that Japan would overtake the United States as the world's largest economy within two decades. The reality has turned out to be very different.
Let's take another case. At least since the 1960s, Brazil has been presented by analysts as a land of great possibilities, with the resources and ambition to become a world power. Brazilians love to say with humor: “Brazil is the country of the future, and always will be.”
And another case. American researcher Francis Fukuyama achieved intellectual stardom in 1989 by stating that the conclusion of the Cold War marked the end of ideological evolution, “the end of history,” with the “universalization of Western liberal democracy.” However, the spread of democracy stalled within a few years of that prediction, and since then we have seen the steady rise of authoritarianism.
Sino-Indian rivalry is reshaping Asian geopolitics. This is a rivalry with signs of intensifying; especially because Chinese President Xi Jinping seems to be in a hurry to achieve what he has called the “Chinese dream,” which consists of making China the preeminent country worldwide and supplanting the United States. Now, to become the first world power, China must first become the dominant power in Asia, where it faces a tough challenge from Japan and India.
The Indian economy is smaller than China's, but growing faster. In fact, according to the IMF, India is today the fastest growing large economy in the world. In the next five years, it will represent 12.9% of global growth, more than the US.
The continued international attention on the war in Ukraine has obscured the military confrontation between India and China along the Himalayan border, one of the longest in the world between two countries.
Three years after China's surreptitious territorial invasions caught India by surprise, the resulting military standoff between the world's two demographic giants shows no end. The confrontation may have garnered few headlines in the European media, but it has encouraged the build-up of rival military forces and intermittent clashes, setting in motion what promises to be a long-term rivalry that will define Asian geopolitics.
By confronting China despite the risk of full-scale war, India has openly challenged Chinese capabilities and power in a way that no other power has done this century, not even the US. This has helped highlight the strategic overreach of Xi Jinping, who with his behavior is counterproductively turning a once conciliatory India into a lasting enemy.
India seems determined to avoid a Sinocentric Asia. In fact, it has accelerated its military modernization. That trend is similar to other consequences of Xi's muscular revisionism, which has caused tectonic shifts in the strategic positions of Japan and Australia, two other leading powers in the Indo-Pacific region. With its decision to double defense spending by 2027, Japan is effectively abandoning the pacifist security policy maintained since the end of World War II. For its part, Australia has abandoned uncertainty and aligned itself against China in the US-led Aukus alliance.
When Xi ordered furtive land grabs in the frozen borderlands of Ladakh, India's northernmost territory, in April 2020, it was a cynical attempt to profit from the death and suffering caused by China's most infamous global export, covid, since India was immersed in the application of one of the strictest national confinements in the world. Xi seriously erred in calculating that China would be able to impose the change in the status quo on India as a fait accompli and without a forceful military response.
Since then, India has more than matched China's military deployment, triggering the largest buildup of rival forces in the Himalayas. The dangerous military battle is centered on one of the most inhospitable terrains in the world along the highest mountain range on the planet, the Himalayas.
Faced with India's refusal to cower, Xi has tried to overcome its defenses by opening new fronts along the extensive border; especially in the eastern Himalayas, more than 2,000 kilometers from the places where China seized land in 2020. In December 2022, a Chinese military incursion into a strategically crucial border area of the Indian state of Arunachal, the northeasternmost state of the country, was repelled by Indian forces after apparently receiving real-time information from US intelligence.
Meanwhile, the Xi regime has carried out other provocations against India, including the Sinicization of place names in Arunachal to reinforce its territorial claim to that sprawling state whose area is almost three times that of Taiwan. In fact, Beijing already refers to Arunachal as “Southern Tibet,” and claims that Arunachal is Chinese “territory” and that Sinicization of place names is a “sovereign right.”
In that sense, it is in India's interest that Taiwan maintain its autonomous status. If Taiwan falls into Chinese hands, Arunachal, which is the size of Austria, could become a new Taiwan in Beijing's eyes that would have to be reunified with the Chinese state.
Therefore, it is in India's interest that Taiwan does not suffer the same fate as Tibet, a once autonomous territory and victim of increasing repression since annexation by China in 1951. Just as the fall of Tibet represented one of the most far-reaching geopolitical events in post-World War II history (among other things, because it gave China a common border with India), the subjugation of Taiwan would cause a global geopolitical reordering, as well as allowing Chinese naval forces to exit the first chain of islands and easy access to the Pacific.
Tibet today serves as a platform to project Xi's territorial expansionism in the region. Under his rule, China has not even forgiven little Bhutan, from which it has been snatching border lands, meadow by meadow. Therefore, Taiwan going the way of Tibet will only accelerate Xi's aggressive irredentism in the Himalayas.
Referring to the Indian military's current direct confrontation with Chinese forces, Admiral Mike Gilday, US chief of naval operations, said in August 2022 that India presents China with a problem on two fronts: “[The Indians] Not only are they now forced to look east, to the South China Sea and the Taiwan Strait, but they now have to dedicate themselves to monitoring India.”
Military reasons explain why China has tried to achieve its objectives against India through stealth, deception and surprise instead of direct combat. Contrary to conventional opinion, India (with the world's most experienced military in hybrid mountain warfare) has an advantage in the high-altitude environment of the Himalayas, according to two American studies (Harvard's Belfer Center and the Center for a New American Security in Washington). And, in contrast to the professionally trained Indian army, the People's Liberation Army relies heavily on recruits who supposedly volunteer for two years of service after reaching the age of 18.
The current military standoff in the Himalayas is a reminder that Xi has chosen a border fight with India that China cannot win. Considering that Xi keeps demonizing the US and accuses it of “containment from all directions, encirclement and suppression against us,” the last thing China should have done is become a permanent enemy of its largest neighbor, India, and bring it ever closer to the US. Perhaps that evolution will end up being Xi's lasting legacy.
The Sino-Indian rivalry is sharpening at a time when China faces long-term domestic constraints and an increasingly unfavorable international environment. Xi seems to believe that China has a small strategic juncture to reconfigure the current international order in its favor. And as a result, their willingness to take risks has increased, especially in Asia.
A comparative analysis of India and China shows that the two giants have clear advantages, but also obvious disadvantages. Their trajectories will be greatly influenced by both internal and external events.
China, the largest autocracy in the world, is a highly hierarchical vertical system. It is a system focused on public order.
In fact, China is the only major country whose official internal security budget exceeds the official national defense budget, reflecting its leadership's focus on public order. In 2019, China's military spending exceeded the combined defense spending of its neighbors: India, Russia, Japan, South Korea and Taiwan. However, the internal security budget has remained higher than the huge defense spending.
China's obsession with public order has helped establish an Orwellian police state that uses the latest technology to surveil its citizens. Despite this, popular discontent has continued to grow due to official corruption, abuse of power, internal politics, pollution and the forced transfer of residents as a result of the acquisition of land to carry out projects. Just a few months ago, large-scale student-led protests forced Xi Jinping to abandon his zero-Covid policy.
However, China's vertical system, with a single window for authorizing foreign investment proposals, has long been perceived as attractive to multinationals and other foreign companies. Wall Street has long been a powerful ally of China, and continues to facilitate Beijing's superpower ambitions. The titans of Wall Street and Silicon Valley have helped make China economically and technologically stronger and more ambitious.
India, in contrast to China, is a very vocal democracy. Democracies, by nature, tend to be chaotic. Now, Indian democracy can be more chaotic than others. Its bustling democracy, with its endless electoral cycles, never ceases to exhibit turbulence.
It can be argued that such Indian democracy, with the display of its turbulence, hides the strengths. In contrast, Chinese authoritarianism presents stability, clarity and direction, and the opacity of its system helps hide internal turbulence.
It can also be argued that social unrest is a greater threat to China's long-term stability than to India. After all, in that country, grassroots participatory processes, as well as avenues for free expression and debate, serve as a safety valve and thus provide a certain stability.
Another key comparative aspect of India and China, which directly influences their future trajectories, is demographics.
China is already facing a demographic crisis that could slow economic growth and undermine its ambitions. The late decision in May 2021 to allow couples to have three children is unlikely to alleviate the demographic crisis. A previous decision, in 2016, had relaxed the one-child policy and allowed couples to have two children.
In 2022, deaths will outnumber births in China for the first time since the Great Leap Forward, Mao Zedong's disastrous economic experiment that killed many, many millions of citizens. The lesson of China's demographic crisis is that the consequences of social engineering by the state cannot be reversed within a generation. Russia has offered attractive incentives for citizens to have larger families, but has failed to halt demographic decline.
The Chinese demographic crisis, unlike the Russian one, has global repercussions because China is the world's factory. Its demographic crisis will create labor shortages and fiscal strains and intensify the slowdown in the economy.
Worse still, China is aging without having first gotten rich. The declining and rapidly aging population and slower growth in productivity could put a brake on China's excessive geopolitical ambitions. Today, China remains a middle-income developing country, taking into account the average income of workers. As China's population ages and the proportion of senior citizens increases, there will be fewer working-age adults to support the elderly, leading to serious economic and social consequences.
In contrast to China, India reaps a demographic dividend even after catching up with the Chinese population. Today it has an average age of 28.4 years, which makes it one of the youngest countries in the world.
The young population drives rapid economic growth, contributes to the rise of consumption and promotes innovation, as evidenced by the development of a world-class information economy.
India has about 600 million more inhabitants than all of Europe, divided into 44 countries. Despite immense cultural and ethnic diversity, it is the first developing economy that has, from the beginning, strived to modernize and prosper through a democratic system.
That has always been a challenge, given the size of the country. However, just as Indian democracy has helped empower people from below, it is also experiencing (and without imposing coercion from above) a significant decline in its population growth rate.
India's total fertility rate (that is, the number of children per woman) has fallen to around 2. Replacement fertility is 2.1 children per woman. However, at least for the next few decades, India will continue to reap a demographic dividend.
Simply put, India, unlike China, does not face structural constraints. And also unlike China, it is not considered to be hungry for foreign lands and resources. Furthermore, the Indian rise has not been accompanied by greater assertiveness.
In general terms, the country's disadvantages must also be noted. The first is cumbersome governance. Indian democracy is polarized. Probably as polarized as American democracy. Now, unlike the American two-party system, the Indian political system is fragmented. India has dozens of political parties. Furthermore, India has long been risk averse and has followed ad hoc approaches and strategies. That has not changed under Prime Minister Narendra Modi.
On the other hand, the present century will not belong to India if the country does not become a manufacturing power.
In reality, the Indian economy is very different from most Asian economies, which tend to be export-oriented. India is a story of service-driven economic growth. And that growth depends largely on domestic consumption, not exports.
However, for this century to belong to India, the country must take full advantage of its relatively low labor costs and the growing interest of Western companies in moving production out of China to become a manufacturing powerhouse. That will not only be good for the global economy; India's accelerated rise could also help build a stable balance of power in Asia.
Today, Modi's India appears stable and resurgent, but its future growth trajectory will depend on political stability, rapid economic growth, internal security and a dynamic foreign policy.
Brahma Chellaney is a geostrategy specialist and author of nine books; among them, the award-winning 'Water: Asia's new battleground' (Georgetown University Press, 2013).
