Why go that far? Do we not do so? Our silence on Tibet speaks for itself. Similarly, it is well known that six years ago Vietnam offered us access to the strategic Cam Ranh Bay. We declined — so as not to offend China. Even six years after establishing a Tri-Services Command structure in the Andaman and Nicobar islands, we have not positioned any significant assets there — in part out of the apprehension that doing so would bring us into direct contest with the Chinese footprint in Myanmar and Bangladesh.

Third, China is already translating its economic power into military might. The 2006 Report of the US Secretary of Defence on China’s military prowess records that the modernisation of Chinese forces is proceeding at a pace faster than US agencies had earlier thought likely.

Fourth, more directly, the scale of China’s and India’s economic development is already making us compete for natural resources — like oil and gas. And the resources that China has accumulated are enabling it to outbid India in contest after contest. In the contest for PetroKazakhastan, China defeat our bid of $ 3.6 billion by bidding $ 4.2 billion. It already has acquired exploration rights for the overwhelming area of Kazakhstan, and has already built a 1000 km pipeline to carry oil from that country into Xinjiang province of China. We depend on Iran for being a counter to Pakistan; for much of our oil and natural gas. But China has now become Iran’s largest market for oil. It has identified projects for investing $ 100 billion in that country in the next 25 years — and this has contributed in no small measure towards its securing deals to import 100 million tons of Iranian LPG and also 150,000 bbl/day of oil — the latter deal is itself worth $ 100 billion. In far away Ecuador too China’s Sinopec and CNPC beat ONGC and won access to 143 million tons of proven oil reserves. In Angola, we had almost got the deal to take over Shell’s operations for off-shore exploration — China swooped it away by extending a 17 year, $ 2 billion soft loan to the country... This rivalry is bound to intensify in the coming years, and the differences in the resources that each side can deploy for each contest is bound to make all the difference to the outcome.

... contd.