Managing the competition and cooperation inherent in the relationship with China continues to be India's major foreign policy challenge, as it seeks to resolve a number of strategic issues related to what happens when two rising powers meet each other and the old power.

As both India and China seek to find their place in the new multipolar world, the 1962 border conflict between India and China is still generating considerable strategic analysis in both countries.

The first strategic question is whether the right lessons have been drawn from the conflict over undemarcated borders between two rising powers seeking to define their identity and territorial integrity.

In recent years the two countries' view that the other was an aggressive, expansionist power on the Southern Tibet issue has finally been changing: The focus is shifting from each seeking to balance the rise of the other, to greater direct engagement and the pursuit of opportunities for collaboration.

China is emerging as India's major trade partner. Bilateral trade between China and India will soon exceed $75 billion and there is great potential in the Chinese market for India's service providers. Meanwhile, India provides an attractive destination for Chinese capital and equipment, with its $1 trillion requirement for infrastructure over the next 10 years. Such cooperation will make the two countries increasingly interdependent economically, and so diminish adversarial instincts.

The second strategic question for both the rising powers is how to gain a greater say in the international regime, with the hegemonic US reluctant to accept them having a larger role. The size and dynamism of their populations, growing share in world trade, national interests in different parts of the world and the need to influence international organizations increasingly require a joint approach to the restructuring of the mechanisms of international governance.

Instead of the finance-led US market and consumption model, the two countries should come together to support a new model of global sustainable development that shares technology and scarce natural resources; one where the eradication of poverty is not a special circumstance or special consideration, but instead a key global policy objective.

A shared vision of prosperity for four billion people will provide the legitimacy to shape the future global order, just as the US shaped the post-World War II global order in the interests of the G7 countries.

China has capital and great strength in infrastructure development and new communication and energy technologies, while India has the capacity for global leadership in pharmaceuticals and new crop varieties, as it is the only country with both extensive endemic biodiversity and a world-class endogenous biotechnology capacity. Both countries should influence the intellectual property regime to secure their national interests and use their technological advances to develop solutions for other developing countries.

The third strategic question facing China and India is how to shape new global rules without challenging the multilateral system which has enabled their rise. Global rules such as those on the use of natural resources within global ecological limits would be vital for the growth of BRICS nations.

To act strategically, both China and India should actively seek to reconstruct global governance in the interests of the half of humanity that has not benefited from globalization. Collaboration is already taking place in the UN climate negotiations, World Trade Organization, restructuring of the Bretton Woods Institutions, the World Health Organization, and the G20.

These ad hoc arrangements need to be converted into strategic cooperation to evolve a vision of human well-being within global ecological limits. Some friction with the US can be expected because it has so far kept issues of redistribution out of the UN system. But the BRICS mechanism adds the voices of Brazil, Russia and South Africa to those of India and China in calling for new rules.

The author has served in various policy positions in the Indian government and represented India as a principal negotiator at the UNCED, Agenda 21, Rio Declaration and the Climate Change Treaty.

(China Daily 10/17/2012 page8)