Skip to main content
SearchLoginLogin or Signup

The Great Circling: China’s Advance in South Asia and the Indian Response

Published onFeb 21, 2022
The Great Circling: China’s Advance in South Asia and the Indian Response

South Asia is a region that reflects a stark contradiction. A sub-continent that stands at the bottom of almost all socio-economic indicators is also at the top of the strategic equation of the world’s greatest powers. The region is indicative of the new trends emerging in the great geopolitical game with shifting power dynamics and forging of new alliances that will shape the world order for decades to come. It provides a platform to reinvigorate the debate on older concepts like dependency theory and the cold war to investigate the nature of these new developments.

The Chinese political elite has turned to South Asia with great enthusiasm for their experiment of intervention into a region rife with problems and challenges that are multi-dimensional, but also of immense opportunities and potential. Their engagement with the countries on the periphery of India has implications that are beyond commercial and financial. These activities are transforming the nature and complexities of the political and security dimension of the region that has far-reaching consequences for India and the world at large.

This paper aims to delve into the implications of the growth of Chinese influence in India’s neighbourhood and the measures undertaken by India in collaboration with its partners worldwide in response to this trend.

The Ubiquity of China in South Asia

China has leveraged its commercial and financial capabilities to solidify its influence in the South Asian region. This is reinforced by the nature and the diversity of the projects initiated in partnership with South Asian Countries. Due to the multidimensionality of its benefits, the government of these countries has characterised their partnership with China as critical to their economic development and technological advancement.

Bangladesh has been the biggest beneficiary in South Asia in terms of assistance from China in infrastructure development. During the Chinese premier visit to the country in 2016, 267 bilateral agreements were signed valuing up to $24 billion for projects such as coastal disaster management, road tunnels, strengthening domestic production capacity, and establishing manufacturing units in its special economic zones1. In June 2020, China sanctioned 97 per cent of Bangladeshi’s imports duty-free2. Energy sector collaboration such as Payra coal-powered plant has also been a key partnership area between the two countries3.

Chinese advancement in its economic collaboration with Nepal witnessed a new thrust after the unofficial blockade of Indian exports of critical supplies to the country in 2015. This has cultivated to deeply entrenched Chinese interest in all aspects of Nepali society. In February 2020, both countries agreed upon a comprehensive transit and transportation agreement, which is expected to diversify Nepal's trade network through access to Chinese ports. Infrastructure projects that include the development of Airports, optical fibre connectivity, hydropower station, and cross-border railways highlight their deepening partnership. Trade relations have also improved in the past decade, with China in 2019 accounting for around 15 per cent of Nepal’s import4.

China is also the largest external creditor of Sri Lanka, accounting for Sri Lanka’s 15 per cent external debt. It has high stakes in Sri Lanka’s critical infrastructure projects such as Hambantota Port, Mattala International Airport and Colombo Port City5.

Increasing defence partnership is an important arena of strategic manoeuvring by China in South Asia. Initiatives such as Sagarmatha Friendship, a joint military exercise between China and Nepal, the possibility of joint patrolling of the border by the two countries and China accounting for the largest arms supplies to Bangladesh and Sri Lanka reflect this development6.

The strength of Chinese diplomatic and strategic incursion into South Asia is the diversity of its approach in engaging the countries on various fronts to advance its strategic interests. The International Department of the Chinese Communist Party has forged alliances with the national and regional parties of the partner countries. Chinese leadership have built a relationship with the elite political class of Nepal and with the Rajapaksa regime at a personal level. Awami League, the monolith in the politics of Bangladesh, signed an agreement with the CCP for enhanced cooperation and sharing of learning and experiences with each other7.

China has also aggressively pushed forward its Soft Influence project. It actively engages with local media outlets, think tanks, local governments, civil society organisations and others through its friendship and learning centres, cultural programs, embassies, and Confucius institutes to enhance its acceptability and admiration among the South Asian population as a trusted and reliable partner. Chinese authorities in these countries are encouraging the teaching of Mandarin in local schools and other educational institutions8. It provides scholarships and student exchange programmes to reach out to the younger population in these countries. It is emerging as the favoured destination for higher education among South Asian students, replacing India in this domain. Chinese tourists are one of the main drivers of foreign earnings for these countries9.

The Pandemic provided a unique opportunity for China to reach out to South Asian Countries to further their collaboration in the public health domain. It provided critical medical supplies such as protective medical apparel, testing kits, technical equipment and expertise, vaccines, and financial aid to mitigate the spread of the virus in these countries. It is also looking forward to expanding the health collaboration by promising to fill the medical infrastructure gap by providing financial aid and technical expertise through its Health Silk Road initiative10.

Chinese inroads in the Indian Ocean Region is a significant security and strategic challenge for India. Instances such as the Chinese naval base in Djibouti, the submarine docking in Sri Lanka, assistance in the water crisis of Maldives, submarine deployments and training with Bangladesh, and oceanographic data mapping of the IOR have only accentuated these concerns11. These have huge potential of undermining the geographical advantages of India in the region.

There has been a correlation between the rise in the economic power of China and the degree of its territorial and ideological assertiveness. Since 2012, it has engaged in overt territorial disputes with its neighbours. These adversarial engagements finally culminated in a deadly clash between the Indian and Chinese armed forces in Galway Valley in June 2020, leading to the loss of lives of 20 Indian and four Chinese Soldiers. The People’s Liberation Army (PLA) had initiated the asymmetrical mobilisation into the Indian side of the Line of Actual Control after President Xi signed a new Training Mobilisation Order.12 China has also constructed several villages, new roads, military bases and security outposts and administrative and communication units in norther Bhutan by unilaterally claiming sovereignty over these areas13.

Indian Response

India has stepped up its engagements with its neighbouring countries under the aegis of its neighbourhood first policy initiated in 2014. These efforts have been characterised by the then Foreign Secretary S Jaishankar as a partnership with like-minded countries for people-centric connectivity projects and a cooperative regional architecture14. India with the US holds close consultation with South Asian states such as Nepal, Bangladesh, and Sri Lanka. India and Japan developed a joint ‘Vision 2025’ plan to seek synergy to strengthen infrastructure and connectivity within India and with other countries in the region and establish industrial networks and regional value chains in collaboration with other partners15. India also signed an agreement in 2014 with Russia to cooperate on developing nuclear power in countries such as Bangladesh and Sri Lanka16. Under its Vaccine Maitri initiative, India prioritised its neighbours in the supply of Covid Vaccine17. It has initiated major infrastructure and connectivity projects with Sri Lanka and Bangladesh.

A marked shift in India’s foreign policy has been the recognition of the significance of island nations in the strategic equation of India’s Indio-pacific vision. India has taken the initiative to actively collaborate with small island nations near strategic locations and chokepoints by holding three summits of the Forum for India–Pacific Islands Cooperation. India has extended credit assistance to smaller island nations for solar and other renewable energy projects to mitigate the adverse effects of climate change. The government has initiated some structural changes, starting with creating the Indian Ocean Region Division (IOR), a new division within MEA. The division provides a platform to facilitate better coordination of initiatives and policies with island nations of Sri Lanka, Maldives, Mauritius and Seychelles. The division acknowledges the strategic importance of the maritime domain in the foreign policy of the country18.

To effectively counter increasing Chinese presence in IOR, the Indian Navy has adopted a twofold approach. First is creating Maritime Domain Awareness (MDA) to provide information on the movement and development across the Indian Ocean, assisting in deciphering trends and identifying the challenges. The second approach is to maintain an expanded naval presence and visibility across the region to increase operational capabilities to address challenges19. The Indian government is also negotiating with island nations such as Seychelles and Mauritius for access to their military facilities to address the logistical challenges in the western and southern Indian Ocean region20. Under the strategic vision launched in 2105, Security and Growth for All in the Region (SAGAR) envisages a greater recognition of the importance of maritime security and cooperation. It aims to deepen economic and security cooperation and collaboration with India’s maritime neighbours through information exchange, building and strengthening of infrastructure and technical capacities and coastal surveillance21.

India took the first official steps in formalising the framework of Indo-pacific by presenting its vision statement in the PM’s keynote address at the Shangri-La Dialogue in 201822. By 2020, the concept of Indo-pacific had received greater recognition as a theatre of opportunities by the Americans and its allies. Australia, France, Japan, and the United States emerged as India’s natural partners and became the pillars of the Indo-Pacific partnerships. India, along with the US, Australia, and Japan, has established the Quadrilateral Security Dialogue (Quad) with a vision as a strategic platform of upholding the rules-based international order, freedom of navigation and trade according to established international laws and promoting connectivity, economic development and security within the Indo-pacific region23.

The Japanese partnership is one of the most successful stories in the contemporary foreign policy of India. Japan is assisting India in countering the overwhelming presence of China in South Asia. India and Japanese companies are jointly collaborating on infrastructure projects across the region. Japan has also aided India in improving connectivity with Bhutan, Bangladesh and Myanmar and building road networks in the northeastern states of Meghalaya, Tripura, and Mizoram. There are ongoing negotiations for a bilateral agreement that would enable India to access the Japanese base in Djibouti in return for Japanese access to Indian facilities on Andaman and Nicobar Islands.24

To counter the recent Chinese overtures in Ladakh, India has deployed 200,000 additional troops over the one million already stationed along its border with China25. India has strongly sent out the message that regular bilateral ties cannot continue alongside friction and violence at the border. India has banned multiple Chinese apps, cancelled Chinese investment in the critical areas and ruled out the Chinese telecom behemoth, Huawei, from its 5G trials. India has also deployed Israeli drones for round the clock surveillance of the border areas26. Defying expectation, Indian armed forces have stood their ground in the friction areas, despite huge deficiencies in terms of modernised weaponry and adverse climatic conditions.


The degree of Chinese engagement differs across countries in the South Asian region. The level of collaboration is contingent on the acceptability for Chinese loans for infrastructure projects, the presence of pro-Beijing political functionaries, an explicit negation of US-led alliances and others. There is a growing realisation of the adverse effects of over-reliance on China. Countries are recalibrating their development strategies by learning from the experiences of each other on how to assert their agency in economic, political, and strategic policymaking27.

Although the rise of China is exponential in the region, a study by Carnegie Endowment highlights that India continues to be the most significant player in the strategic and foreign policy orientation of South Asian countries. However, with the determination of Chinese policymakers for a China-led Asian Century and the pace of change in relations within the region, the possibility of India losing out to China cannot be discounted. India's historical, cultural, and social ties with its neighbours have not only benefited but also exposed it to a higher level of criticism from the political and civilian class of these countries. A coherent vision of Indian engagement with the South Asian countries is necessary to check China’s extensive inroads in South Asia effectively. This requires streamlining India’s domestic foreign policy initiatives on the region, such as Act East, SAGAR, The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) with its engagement with foreign partners and leveraging their vision on Indo-pacific to India's strategic advantage. A possibility of reviving the SAARC forum should also be explored to present South Asia, notwithstanding bilateral frictions and conflicts, as a coherent unit.


1. Ruma Paul and Ben Blanchard, “China to sign some $24 billion in loans to Bangladesh as Xi visits,” Reuters, October 14, 2016,

2. “China provides tariff exemption for 97% of exports from Bangladesh,” Business Standard, June 20, 2020,

3. Abu Siddique, “China is building a coal power plant in Bangladesh despite protests by civil society,”, May 02, 2021,

4. Deep Pal, China’s Influence in South Asia: Vulnerabilities and Resilience in Four Countries, Washington DC, Carnegie Endowment for International Peace, 2021,

5. Ganeshan Wignaraja et al., “Chinese Investment and the BRI in Sri Lanka,” Chatham House, March 2020,

6. “China’s Influence in South Asia: Vulnerabilities and Resilience in Four Countries”

7. “China’s Influence in South Asia: Vulnerabilities and Resilience in Four Countries”

8. Nayanima Basu, “Mandarin now a compulsory language in Nepal’s schools as China foots the bill,” The Print, June 17, 2019,

9. “China’s Influence in South Asia: Vulnerabilities and Resilience in Four Countries”

10. Deep Pal et al., “Health Silk Road — How China plans to make BRI essential in Covid-hit South Asia,” The Print, June 11, 2020,

11. Darshana Baruah, India in the Indo-Pacific: New Delhi’s Theater of Opportunity, Washington DC, Carnegie Endowment for International Peace, 2020,

12. Dinakar Peri and Ananth Krishnan, “LAC standoff | Xi Jinping’s mobilisation order, months of planning preceded border moves,” The Hindu, July 13, 2020,

13. Robert Barnett, “China Is Building Entire Villages in Another Country’s Territory,” Foreign Policy, May 7, 2021,

14. “Countering China’s presence in S Asia,” The Hindu Business Line, September 12 , 2017,

15. Ministry of External Affairs, Government of India,

16. Anil Sasi, “Nuclear projects in third countries: Indian cog in Russia’s nuclear apparatus,” The Indian Express, December 21, 2016,

17. Ministry of External Affairs, Government of India,

18. “​​MEA Expands Indian Ocean Division to Include Islands off African Coast,” The Wire, December 20, 2019,

19. “India in the Indo-Pacific: New Delhi’s Theater of Opportunity”

20. Samuel Bashfield, “Agalega: A glimpse of India’s remote island military base”, Lowy Institute, March 2, 2021,

21. Narendra D Modi, “Commissioning of Offshore Patrol Vessel Barracuda” (speech, Mauritius, March 12, 2015),

22. Ministry of External Affairs, Government of India,

23. Shiela A Smith, “The Quad in the Indo-Pacific: What to Know,” Council on Foreign Relation, May 27, 2021,

24. Krzysztof Iwanek, “Japan Steps in to Support India Against China in South Asia,” The Diplomat, December 6, 2021,

25. “Watch: India's biggest defence shift — 200,000 troops on China border,” Wion, June 29, 2021,

26. “Huawei and ZTE left out of India's 5G trials,” BBC, May 5, 2021,,to%20lock%20the%20firms%20out.&text=Although%20Huawei%20and%20ZTE%20were,supplying%205G%20equipment%20to%20carriers

27. “China’s Influence in South Asia: Vulnerabilities and Resilience in Four Countries”

No comments here
Why not start the discussion?