Explained: Why India's SCO Engagement With China Requires Caution Given CPEC Expansion, Border Threat

Indian Prime Minister Narendra Modi’s visit to Tianjin for the Shanghai Cooperation Organization (SCO) summit came on the heels of Chinese Foreign Minister Wang Yi’s Delhi stopover. His two-day visit was framed as an attempt to reset ties between the Asian giants after years of strain, particularly since the Galwan clashes in June 2020.

The Indian Ministry of External Affairs (MEA) described the tone of discussions as “positive.” The statement emphasized a “fair, reasonable and mutually acceptable resolution” of the boundary question, while Chinese officials noted that “stability” had been “restored.” The backdrop was significant: Wang’s Delhi stop was widely seen as preparation for the recently concluded Modi–Xi Jinping engagement at the SCO, aimed at countering U.S. moves in both geoeconomics and geopolitics.

 

Chinese President Xi Jinping to Indian PM Modi: “China and India are ancient civilizations, the world’s most populous nations and pillars of the Global South. The dragon and the elephant must walk together as partners for progress, solidarity and human advancement.” pic.twitter.com/khi75aW8FZ

— Catch Up (@CatchUpFeed) August 31, 2025

 

Border Talks, SCO Calculations, and U.S. Tariffs

Wang’s meeting with Modi, External Affairs Minister S. Jaishankar, and National Security Adviser Ajit Doval served more than bilateral optics. It was an exercise in groundwork for the SCO summit. Chinese Ambassador Xu Feihong’s pointed reference to Washington as a “bully” made clear that Beijing seeks to frame India as a partner in managing U.S. power. This comes against the backdrop of new Trump-era tariffs, with India hit by 50 percent duties, including penalties for Russian oil purchases.

China-India rapprochement thus carries a strategic logic. Both sides face pressure from Washington and see benefits in coordination. Yet the fundamentals of the relationship remain unsettled. India’s $100 billion trade deficit with China persists, while New Delhi’s concerns over infrastructure buildup along the Line of Actual Control (LAC) remain largely unaddressed.

While Wang’s stop in Delhi suggested rapprochement, his onward trip to Pakistan revealed the parallel track in China’s diplomacy. Meeting with General Asim Munir and Prime Minister Shehbaz Sharif, Wang pledged “steadfast support” for Islamabad. The launch of the second phase of the China-Pakistan Economic Corridor (CPEC-II) underscored Beijing’s long-term investment in Pakistan’s strategic value.

For India, CPEC-II raises sharp concerns. It not only strengthens Chinese leverage under the Belt and Road Initiative but also complicates India’s territorial and security calculus. New Delhi views the project as intensifying pressures at a time when Islamabad is reengaging with Washington. The combined dynamic creates fresh challenges for India, even as Modi’s government weighs cautious alignment with China against escalating U.S. trade confrontation.

Fragile Gains and Lingering Mistrust

Despite the warmer rhetoric, trust between Beijing and New Delhi remains limited. Since Rajiv Gandhi’s 1988 Beijing visit, the two countries have sought to build confidence through trade and dialogue. But repeated failures in implementing border mechanisms and the impact of Galwan underscore how quickly ties can unravel.

China’s continued infrastructure activity across the LAC: railways in Tibet, hydropower projects on the Yarlung Tsangpo, feeds Indian security concerns. Meanwhile, Beijing has regularly objected to India’s own development moves in Arunachal Pradesh. These asymmetries reinforce perceptions in New Delhi that China seeks engagement on its terms while avoiding resolution of the “thorny” border issue.

Wang’s visit also revived debate over India’s stance on the One China policy. The suggestion of an “early harvest boundary settlement” allows Beijing to project progress while leaving the larger dispute unresolved. At the same time, Taiwan’s rising profile in global debates complicates India’s positioning. Beijing’s narrative-building around Taipei risks boxing India into a cautious stance that limits outreach to Taiwan.

What SCO Diplomacy Means for India

The SCO context highlights why India’s balancing act is difficult. Warmer ties with China may help offset U.S. tariffs, but Pakistan’s deepening role in Chinese projects undermines Indian security interests. Beijing’s outreach appears driven less by recognition of India as an equal and more by the calculus of facing Washington.

For India, the challenge remains twofold: securing tangible progress on the border and narrowing the trade imbalance. Without concrete shifts, recent exchanges, including Modi’s Tianjin trip, risk being seen as diplomatic posturing rather than a durable reset. The SCO provides a stage for signaling, but the test will be whether Beijing’s overtures extend beyond optics to genuine respect for India’s strategic autonomy.