From $100bn to $20bn: What the missing billions say about Sino-India relationship

China’s consul-general in Mumbai throws around a figure of $100 billion in investment over the next five years. His president, Xi Jinping, signs agreements that total only $20 billion. The explanations for this curious gap are a metaphor for why the Sino-Indian relationship will never go beyond a certain point.

“The $100 billion figure was never an official number. The csul-general was perhaps imagining what could happen,” a Chinese embassy official said. Indian diplomats scoff at the idea a Chinese official would offer a figure without approval far up the food chain.

The $100 billion seems to have largely designed to overshadow the $35 billion five-year plan announced by Japanese Prime Minister Shinzo Abe.

Xi’s failure to even rhetorically match the initial expectations about his trip underlines two elements of China’s attitude to India.
One, Beijing is short term about India. During the Depsang intrusion, a senior Indian official spoke of China’s “great power autism” – how it would let small things undo all the good things it had accomplished.

Over 80% of Indians mistrust China: an older generation because of 1962, a younger one because of Beijing’s belligerence. Talking one number and walking a smaller one will reinforce what many Indians say in private: “You can’t trust the Chinese.”

Two, China tends to treat India better when a powerful third country is cosying up to New Delhi. Xi has good reasons to seek better ties with India. He needs infrastructure markets for his over-sized capital goods manufacturers.

But Beijing does not see India, a messy democracy with an economy one-fourth China’s, as being in the same league. Before they officially take power, Chinese leaders visit the countries they see as big leaguers. Xi did not come here.

Japan’s wooing of India is a key reason China is all sweetness and light on the economic front. Indian negotiators of the 2006 border agreement say they got a good deal because of their then close ties with the US.

That Xi did not feel he even needed to match what Abe had offered was a sign of that this has yet to change with China. “This was the only surprise in the trip,” said a Japanese diplomat. And a sobering reminder for India.