India and China: “Awakening Giants” Towards a Win–Win Future?

The present chapter is set against the backdrop of the recent emphatic revival of “South–South” economic relations and cooperation in a massive post-crisis shifting away of global economic power from the advanced “North” to the developing “South” in standard trade parlance. For now, it is unequivocally China that is driving the burgeoning South–South economic flows by dint of its ability to deploy an unorthodox growth model with investment as the crucial cornerstone in its ambition to climb up the industrial value chain (UNCTAD 2015). The imminent “seismic” shift in global power has profound implications for paths of industrial progress in the developing world and areas of strategic developmental cooperation (ibid). Among emerging economies, India today stands on nearly equal footing with the formidable China in the global economy. The present chapter examines some salient aspects of the India–China relationship, going beyond production, industry and trade to touch upon some of the strategic and institutional factors that have to a large extent defined and shaped crucial national and international policies in both economies. We conclude with a look at the future possible directions in which the critical mutual Sino–Indian relationship seems to be headed.