Trade ties unlikely to prevent conflict between India and China

The debate over whether commercial ties can prevent armed conflict between India and China continues to divide economists and strategic analysts across the region. While trade relationships create mutual economic interests, they have historically proven insufficient as guarantees against military disputes, particularly when territorial or security concerns are at stake.

Proponents of enhanced trade argue that economic interdependence creates a natural disincentive for conflict by raising the potential costs of war for both nations. When countries maintain significant commercial relationships, the disruption caused by military action affects not only governments but also private businesses, investors, and consumers on both sides. This economic calculus may not eliminate geopolitical tensions entirely, but it could make decision-makers more cautious about escalation.

However, the track record suggests limitations to this theory. India and China have maintained trade relationships running into billions of dollars annually, yet border disputes and military standoffs have persisted. The 2020 Galwan Valley clash, occurring amid ongoing commercial relations, demonstrated that economic ties alone cannot override strategic competition or nationalist sentiment during moments of heightened tension.

Experts contend that while unrestricted trade between nations can theoretically encourage peaceful resolution of disputes through mutual benefit, other factors—including geopolitical positioning, security perceptions, and historical grievances—often supersede purely economic calculations. For India and China, managing their complex relationship will likely require coordinated diplomatic efforts beyond commercial arrangements.