Global: Jurnal Politik Internasional

Volume 25 Number 2 Article 5

12-30-2023

INDIA'S SECURITY THREATS FROM CHINESE MILITARY FUNDING

AND ECONOMIC DEVELOPMENT IN SOUTH ASIA
Tran My Hai Loc
Ho Chi Minh City University of Foreign Languages - Information Technology, loc.tmh2312@gmail.com

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Recommended Citation
My Hai Loc, Tran (2023) "INDIA'S SECURITY THREATS FROM CHINESE MILITARY FUNDING AND
ECONOMIC DEVELOPMENT IN SOUTH ASIA," Global: Jurnal Politik Internasional: Vol. 25: No. 2, Pp.
115-139.
DOI: doi.org/10.7454/global.v25i2.1289
Available at: https://scholarhub.ui.ac.id/global/vol25/iss2/5

This Article is brought to you for free and open access by the Faculty of Social and Political Sciences at UI Scholars
Hub. It has been accepted for inclusion in Global: Jurnal Politik Internasional by an authorized editor of UI Scholars
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INDIA'S SECURITY THREATS FROM CHINESE MILITARY FUNDING AND
ECONOMIC DEVELOPMENT IN SOUTH ASIA

Cover Page Footnote

I want to express my sincere gratitude to the reviewers and my advisor, who have contributed to the
completion of the article with excellent comments and suggestions.

This article is available in Global: Jurnal Politik Internasional: https://scholarhub.ui.ac.id/global/vol25/iss2/5

Global: Jurnal Politik Internasional Vol. 25 No. 2. Page 115-139.
© Global: Jurnal Politik Internasional 2023 E-ISSN: 2579-8251
INDIA'S SECURITY THREATS FROM CHINESE MILITARY FUNDING AND
ECONOMIC DEVELOPMENT IN SOUTH ASIA

Tran My Hai Loc

Ho Chi Minh City University of Foreign Languages - Information Technology

Email: loc.tmh2312@gmail.com
Submitted: 19 June 2023; accepted: 19 December 2023

ABSTRAK
Sejak memperoleh kemerdekaan pada tahun 1947, populasi, luas wilayah, posisi ekonomi yang
kuat, serta ikatan sejarah dan budaya telah memungkinkan India untuk mendominasi negara-
negara tetangga di Asia Selatan yang memiliki ekonomi relatif kurang berkembang dan kekuatan
militer yang lebih lemah. Sejak Narendra Modi menjabat sebagai Perdana Menteri India pada
tahun 2014, kebijakan "Neighbourhood First" diciptakan untuk meningkatkan pengaruh India di
Asia Selatan, menciptakan lingkungan yang menguntungkan bagi langkahnya mencapai kekuatan
global. Akan tetapi, meningkatnya kehadiran dan pengaruh militer Cina di Asia Selatan melalui
dukungan keuangan dan militer ke negara-negara tetangga telah mengganggu arsitektur
keamanan kawasan ini. Artikel ini menggunakan metodologi kualitatif untuk meneliti ancaman
keamanan India dari dukungan militer dan ekonomi Cina ke negara-negara Asia Selatan. Artikel
ini menemukan bahwa Asia Selatan memegang posisi penting dan diprioritaskan dalam kebijakan
luar negeri India dan Cina. Persaingan strategis antara India dan Cina di kawasan Asia Selatan
telah dan terus berdampak pada negara-negara di kawasan ini secara signifikan. Dengan
dukungan keuangan dan militer, Cina secara bertahap membentuk pengaruhnya di Asia Selatan,
menimbulkan ancaman keamanan yang dapat mengisolasi India di wilayah Samudra Hindia.
Artikel ini menyimpulkan bahwa upaya Cina untuk membendung India di kawasan ini membuat
India meningkatkan kerja sama militer dan memperkuat kemitraan pertahanannya dengan
negara-negara penting di kawasan Indo-Pasifik untuk membatasi ancaman dari Cina.

Kata Kunci: India, ancaman keamanan, otonomi strategis, kerja sama militer, Indo-Pasifik

ABSTRACT
Since gaining independence in 1947, India's population, expansive land size, robust economic
position, and historical and cultural ties have enabled it to dominate South Asian neighbours with
comparatively less developed economies and weaker military strength. Since Narendra Modi
assumed office as the Prime Minister of India in 2014, the “Neighbourhood First” policy was
coined to enhance India's influence in South Asia, creating a favourable environment for its
ascent as a global power. However, China's increasing military presence and influence in South
Asia through financial and military support to neighbouring countries have disrupted the region's
security architecture. This article uses qualitative methodologies to examine India's security
threats from China's military and economic support to South Asian countries. The paper finds
that South Asia holds a crucial and prioritised position in the foreign policies of both India and
China. The strategic competition between India and China in the South Asian region has had and
continues to impact the countries in the area significantly. With financial and military support,
China is gradually shaping its influence in South Asia, posing a security threat that could isolate
India in the Indian Ocean region. It concludes that China's attempts to contain India in the region
led India to enhance military cooperation and strengthen its defence partnership with significant
countries in the Indo-Pacific region to limit the threats from China.

Keywords: India, security threats, strategic autonomy, military cooperation, Indo-Pacific

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INTRODUCTION
India and China are the world's largest and most populated countries, with rapidly
developing economies. However, China became interested in South Asia during the Cold
War, and Nepal was among the initial four nations to receive Chinese aid in the 1950s
(Kaura, 2018, p.9; Namboodiri, 1979). During this period, the Chinese government
sought to expand its regional influence through economic assistance and military support
to South Asian countries, which is seen as an attempt to counter the influence of India,
which had traditionally held a dominant position in the Indo-Pacific region. Since
assuming the prime minister's office in 2014, Prime Minister Narendra Modi has actively
pursued the Act East policy. In recent years, India has consistently promoted multilateral
cooperation in defence with major powers, especially with nations along the maritime rim
of the Indo-Pacific. These strategic initiatives reflect India's commitment to collaborating
with Southeast Asian partners who share the goal of upholding the rules-based
international order and norms, particularly in response to growing assertiveness from
China in the region. India and China have sought to expand their power over the area
since this period, though their approaches have differed. Simultaneously, China's rise in
recent years is considered a global power that has positioned it in confrontation with India,
and the two countries are involved in a complicated power struggle in South Asia.
In recent years, China's escalating military funding and economic initiatives in
South Asia have sparked concerns in India regarding its strategic interests in the region.
Chinese President Xi Jinping's Belt and Road Initiative (BRI), launched in 2013, has
become a central component of China's foreign policy. This initiative involves
constructing crucial infrastructure, such as ports, highways, railways, and power plants,
and establishing economic corridors linking various countries. One prominent project
under the BRI is the China-Pakistan Economic Corridor, a collection of infrastructure
initiatives in Pakistan that involves the development of highways, railways, power plants,
and a port, connecting China's western region to Pakistan's port city of Gwadar and
facilitates more direct access to the Arabian Sea and the Indian Ocean (Wolf, 2020, p.21).
It is crucial to note that this corridor still passes through the Pakistan-administered part of
Jammu and Kashmir, an area over which India asserts its sovereignty.
Moreover, the Hambantota port in Sri Lanka is another infrastructure project that
is part of the BRI. In 2017, China acquired a 99-year lease on the dock as part of a debt-
for-equity swap (Wignaraja et al., 2020, pp. 9 & 24). The port is located near the main
shipping route between Asia and Europe and is essential to China's maritime trade. The

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acquisition of the port has raised concerns among some countries in the region about
China's expanding influence in the Indian Ocean. These Chinese-funded projects have
raised concerns in India, being perceived as potential sources of strategic military
advantages for China and as potential underminers of India's influence in the region.
Notably, this strategic initiative, often called the “String of Pearls”, encompasses China's
expanding military presence in the Indian Ocean, evident in establishing naval ports in
Djibouti, Pakistan, and Sri Lanka. This development prompts questions about China's
regional ambitions and raises security considerations for India.
India faces a security threat as China supports its military and advances its
economy. Substantial investments in modernising forces and acquiring advanced
technologies give China a significant regional advantage. Additionally, China
strategically develops infrastructure projects and fosters economic growth in South Asian
countries like Pakistan, Nepal, and Sri Lanka, increasing its influence. These
developments raise India's concerns about China's expanding impact and the associated
security threats. In response, India has fortified its military capabilities and forged strong
alliances with major regional powers, including the US and Japan.
This article is crucial for comprehending China's strategic approach in South Asia
and gaining insights into India's strategic considerations and countermeasures. This
article's primary objective is to thoroughly analyse the impact of China's military funding
and economic development initiatives in South Asian nations on India's national security.
By identifying key concerns and opportunities arising from China's growing influence in
the region, the research aims to provide a comprehensive understanding of the strategic
dynamics at play.
This research attempts to contribute significantly to formulating well-informed
policy decisions and strategies. By shedding light on the security threats posed by China's
military and economic advancements in the region, the article aims to empower
policymakers with the knowledge needed to devise effective measures to safeguard
India's interests. This study is conducted to enhance the discourse surrounding India's
security challenges in the face of China's expanding influence in South Asia and to
facilitate the development of proactive and strategic responses to these challenges.

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CONCEPTUAL FRAMEWORK
India's security threats stemming from Chinese military funding and economic
development in South Asia can be analysed within the framework of the Power Transition
Theory. This theory, considered a branch of Realism, offers valuable insights into the
dynamics of power relations between nations. In the case of India and China, a
geopolitical approach can shed light on China's BRI and its expanding presence in South
Asia, which may be perceived as a threat to India's strategic interests.
Power Transition Theory, initially formulated by A.F.K. Organski in the late
1950s, provides a valuable tool for understanding global power shifts (Lemke, 1997). It
mainly examines the relationship between China and India in South Asia. As China's
economic and military capabilities have grown, it has emerged as a significant player in
the Indo-Pacific region, posing a challenge to India's strategic interests and increasing
tensions and competition between the two countries.
According to the Power Transition Theory, a power transition occurs when a
rising power challenges the dominant power, potentially resulting in conflict or war. In
South Asia, China's expanding military and economic influence directly challenges
India's dominance, which could trigger a power transition and, in turn, conflict (Patel
Nandeeni, 2021, pp. 21-29). This theory has proven instrumental in understanding the
thought processes and relationships between countries worldwide. Rajesh Basrur (2011),
Hasanat Shah, Syed and Li, Jun Jiang, and Li, Wang (2013), Xiaoyu Pu (2017), and
Nandeeni Patel (2021) have concurred that within the framework of power transition
theory, the relationship between India and China unfolds as a narrative of evolving
regional influence and strategic rivalry. China's notable economic rise and military
modernisation have positioned it as a formidable ascending power, challenging India's
established dominance in South Asia. This shift in power dynamics has given rise to a
complex interplay of interests involving territorial disputes, economic competition, and
geopolitical manoeuvring. While India aims to preserve its regional stature and uphold
existing international norms as the incumbent power, the resulting competition between
the two nations is marked by diplomatic manoeuvring, military posturing, and economic
rivalry. The existing literature has extensively explored these dynamics. However, the
novelty of this research lies in its focus on the specific case study, shedding light on
unique aspects that still need to be fully addressed in previous studies. While tensions
persist, the power transition theory also leaves room for diplomatic efforts and

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cooperation, emphasising the potential for both nations to navigate their competition and
find common ground in shaping the evolving regional order.
Based on this theory, India is actively enhancing military cooperation with South
Asian and key Indo-Pacific nations to address security concerns stemming from China's
military funding and economic presence. This strategic approach, driven by the Power
Transition Theory, emphasises India's quest for strategic autonomy to mitigate risks and
reduce dependence on external powers, particularly China. By diversifying economic
partnerships, strengthening indigenous capabilities, and fostering diplomatic
engagements with regional and global actors, India aims to counterbalance China's
influence, assert its independence, and ensure a secure and stable regional environment.
This strategy involves deepening security cooperation, conducting joint military
exercises, and promoting connectivity initiatives.

RESEARCH METHODS
This article employs secondary data research and qualitative methods to examine
information from primary and secondary sources, including government documents,
economic data, and reputable journals, books, and scientific information in the mass
media. The article clarifies China's military funding and economic development in South
Asia and their threats to India's security. Case studies could involve an in-depth analysis
of specific events, such as China's investment in the Gwadar port in Pakistan, its military
support for Nepal, and China's strategy in Sri Lanka.

RESULT AND DISCUSSION

The Importance of South Asia in China and India’s Strategy
A complex mix of historical, economic, political, and security factors shapes South Asia's
geopolitics. The region has eight countries: Afghanistan, Bangladesh, Bhutan, India, the
Maldives, Nepal, Pakistan, and Sri Lanka. These countries share historical, cultural, and
economic ties but face significant security challenges, territorial disputes, and power
struggles (My Hai Loc, 2021, p. 46-47).

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Tran My Hai Loc

Figure 1. South Asia Map

Source: UN Geospatial (2011)

The rivalry between India and Pakistan lies at the heart of South Asian geopolitics
(Wani, 2022). The two countries have fought several wars and have a long-running
territorial dispute over the Jammu and Kashmir regions. The competition has influenced
the region's security environment, with both countries aggressively expanding their
military capabilities and seeking partnerships with other countries. The close relationships
between India, China, and Pakistan’s increasing association with the US have given a
new dimension to the competition and complicated the strategic balance of other countries
in the region. Additionally, South Asia's geopolitics are influenced by its strategic
location, which connects the Middle East, East Asia, and the Indian Ocean.
In China's foreign policy, South Asia is integral to the BRI and crucial in
advancing China's global market and resource connectivity goals (Anwar, 2020, p. 163).
The overarching objective is to expand economic and political influence through the BRI,
emphasising soft power enhancement and securing essential energy and resource needs.
South Asia's strategic significance within the BRI lies in its geographic location,
providing access to the Indian Ocean—a critical region strategically positioned between
the Middle East and East Asia, facilitating a substantial portion of global trade.

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China has made substantial regional investments, exemplified by initiatives like

the China-Pakistan Economic Corridor, connecting China's western province to the
Pakistani port of Gwadar on the Arabian Sea (Liu & Ahmed, 2020). This extends to
regional infrastructure projects, including highways, ports, railways, and energy
initiatives. Beyond establishing economic dominance, China aims to foster closer ties
with regional governments, reduce reliance on the Malacca Strait, and strategically
leverage influence over India, a key regional rival.
South Asia is pivotal in China's strategic transformation of the Asia-Europe
security and political landscape, serving as a stepping stone toward the overarching goal
of becoming the predominant power in Asia. The BRI acts as the conduit to pursue
economic objectives, laying the groundwork for political influence in South Asia while
progressively extending reach across the broader Asia-Europe continent. In essence,
South Asia is not merely a strategic competition ground with India but a dynamic
'playground' where China actively implements its strategy to attain pre-eminence in the
broader Asian region.
For India, South Asia is both an opportunity and a challenge. India sees the region
as a crucial part of its neighbourhood policy and aims to build closer ties with its
neighbours through economic and cultural cooperation. South Asia holds the utmost
political priority, serving as a gateway for the country to emerge as a cornerstone in the
free and open order of the Indian Ocean-Pacific region. India has also launched the
forefront policy to solve some issues in the region through the "Neighborhood First"
policy, which prioritises its neighbours in its foreign policy (Aryal, 2022). Because India
has traditionally sought to prevent major geopolitical changes in South Asia, India faces
significant challenges in the region, including security threats from terrorism and
separatism, territorial disputes with its neighbours, and China's growing influence. India's
rivalry with China has intensified in recent years, with the two countries competing for
regional influence through economic, military, and diplomatic means. For this reason,
India is also concerned that China has committed more than US$150 billion to the
economies of Afghanistan, Bangladesh, the Maldives, Pakistan, Nepal, and Sri Lanka,
with the highest penetration in countries flanking India. China, now the largest overseas
investor in the Maldives, Pakistan, and Sri Lanka, is considered a threat to its security and
regional stability.
In essence, South Asia holds paramount importance for both China and India,
driven by historical, cultural, and economic ties among its eight nations. The enduring

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India-Pakistan rivalry, particularly over Jammu and Kashmir, significantly influences the
region's security dynamics. South Asia is a linchpin in the BRI for China, providing
avenues for economic dominance and strategic leverage over India. China's investments,
notably in the China-Pakistan Economic Corridor, extend beyond economic interests.
Conversely, India sees the region as pivotal in establishing a free and open order in the
Indian Ocean-Pacific region. However, India grapples with challenges, including security
threats, territorial disputes, and China's rising influence. The escalating India-China
rivalry, spanning economic, military, and diplomatic domains, further complicates the
strategic landscape. As both nations pursue their South Asian strategies, the region
becomes a battleground for competition and a dynamic arena for implementing their
visions of pre-eminence in the broader Asian context. The evolving dynamics in South
Asia will inevitably shape the geopolitical landscape, influencing regional stability,
economic development, and the balance of power in the expansive Indo-Pacific region.

Sino-Indian Rivalry is Shaping South Asian Geopolitics

Geopolitical, economic, and strategic factors influence China's South Asian interests.
These elements are crucial to advancing China's strategic objectives, which revolve
around bolstering influence, ensuring access to regional resources and markets, and
securing strategic locations. Although China has surpassed India to become a significant
commercial partner for several South Asian nations, it still views India as a potential rival
and endeavours to curtail its influence in the region to maintain its authority and safeguard
its interests. China may attempt to curtail India's influence in the region, particularly in
countries within China's ambit of influence, like Pakistan, Sri Lanka, and Nepal, by
bolstering to diminish India's power and influence. In addition to strengthening its own
economic and military ties with these nations, China's increasing military presence in the
Indian Ocean, including the development of naval ports in Pakistan and Djibouti, might
be intended to expand its strategic footprint in the region and project influence beyond its
frontiers (Kondapalli, 2018). This might jeopardise India's strategic interests and the
regional balance of power.
Over the last few decades, China's economy has experienced impressive growth,
positioning itself as a significant economic force worldwide. Currently, China's economy
ranks second globally, only behind the United States, whereas India's economy, although
overgrowing, is still considerably smaller than China's. The competition between these
two countries is fierce, as both strive to expand the region. The military competition

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between China and India is also significant, with both nations boasting well-equipped
armies and nuclear capabilities. The countries have been involved in various military
standoffs along their disputed border, most recently in the Doklam in Bhutan in 2018 and
Galwan Valley in 2020. This military rivalry is partly driven by territorial disputes,
particularly in the Aksai Chin region (Kaura, 2020, p.501).
In addition, the power transition between India and China is complicated, given
their membership in various influential groups beyond BRICS, such as G20, SCO, and
ARF. The BRICS countries are seen as potential rivals to the established Western powers,
and they have a skin together to challenge the existing global power structure. However,
within the BRICS group, there is competition for dominance between India and China.
Therefore, the Sino-India power rivalry has necessary implications for the South Asia
region. The two countries are the largest and most powerful in the region, and their
competition is likely to shape the region's future. The power struggle between India and
China will likely continue in the coming years as both countries seek to establish
themselves as the dominant power in the region. Against the backdrop of escalating
strategic competition between India and China in the region, South Asian countries have
developed a form of asymmetric bargaining power in the age of globalisation. This
dynamic arises as the two ascending powers compete and cooperate across various
domains. The present India-China relationship embodies three key characteristics: 1)
Relations between rising major powers, 2) Relations between neighbouring countries, and
3) Relations between developing nations. The strategic competition between India and
China in South Asia will likely persist and expand in both its reach and impact. The
outcome of this competition is expected to be a recognition of each other's positions,
accompanied by flexible responses from regional countries to promote economic
development and safeguard national interests.
The competition between the two countries is expressed through four strategies of
opposition. Firstly, China's strategic interests in South Asia are undoubtedly motivated
by a desire to counterbalance India's rising power and influence. China considers India a
vital strategic rival and has tried to limit India's dominance in the region by strengthening
connections with Pakistan, Nepal, and Sri Lanka. China has also attempted to encircle
India by establishing a "String of Pearls" of military and economic relationships with
countries around India (My Hai Loc, 2021, p.50). Secondly, China's economic
development initiatives aim in the region to create economic dependence and influence
over South Asian countries. By doing so, China aims to limit India's rise to challenge

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China's economic influence in the region and create a strategic buffer against India.
Thirdly, China's backing of Pakistan, evident in military aid and cooperation, establishes
a strategic balance against India and constrains India's capacity to exert influence in the
region. Additionally, China supports Pakistan in various international forums, including
the United Nations, to strengthen its position diplomatically. This support not only acts
as a countermeasure to ties with the United States but also serves to navigate relations
with other regional powers.
India's response to China's growing influence in the South Asia region carries
significant implications, particularly in India's pursuit of strategic autonomy. It has
ushered in a new strategic dynamic with India aiming to uphold its leading role in
fostering regional stability and security while safeguarding its interests vis-à-vis China.
This has resulted in new partnerships and alliances, exemplified by the QUAD,
comprising India, the United States, Japan, and Australia, which seeks to promote a free
and open Indo-Pacific. Notably, India's strategic partnership with the United States is a
crucial example of enhanced military cooperation in the region, as evidenced by the
ratification of defence agreements and joint military exercises. Strengthening ties with
the United States allows India to counterbalance China's growing influence while
bolstering its military capabilities.
Furthermore, India has deepened military cooperation with Japan, Australia, and
Southeast Asian nations, engaging in joint military exercises, defence dialogues, and
other collaborative efforts to uphold regional peace and address the challenges posed by
China's influence. These endeavours have also fostered regional integration and
connectivity, exemplified by initiatives like the Chabahar Port in Iran and the
International North-South Transport Corridor (Sahakyan, 2020). The future of the South
Asia region hinges on how India and other regional actors navigate these complex
dynamics, seize opportunities, and manage their relationships with China while
preserving their strategic autonomy.
In conclusion, China's rise as a global power has brought it into direct competition
with India, and the two countries are engaged in a complex power struggle. This struggle
is primarily economic and military, with important implications for the region's future.
The power transition between China and India will likely continue in the coming years as
both countries seek to establish themselves as the dominant power in the region.

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Analysis of Chinese Military Funding and Economic Development in South Asian

Countries
A mix of cooperation and competition has recently characterised the relationship between
India and China. Despite the significant economic and cultural ties between the two
countries, China's strategic ambitions in South Asia have substantially threatened India's
regional security. China's increasing military funding and economic development
activities in India's neighbouring countries have been a significant risk for New Delhi.
China's military funding and aid to South Asian countries, including Pakistan,
Bangladesh, and Sri Lanka, have raised concerns about China's strategic intentions and
its impact on India's security. However, in 2021, China warned Bangladesh not to
participate in the "QUAD" - the US alliance led by the US; China believes that
Bangladesh's participation is an anti-Beijing action that will lead to significant damage to
bilateral relations (Hindustan Times, 2021). As a result, Bangladesh has responded to
China's point of view, arguing that China has intervened too deeply in another country's
foreign policy. Continuously, China's military aid to Pakistan, including the supply of
fighter jets, submarines, and other advanced military equipment, has significantly
enhanced Pakistan's military capabilities and raised concerns about the balance of power
in the region. China has also provided military aid to other countries in the region,
including Bangladesh, Sri Lanka, and Nepal, and has conducted joint military exercises
with these countries.
To better understand China's strategy for each key country, the map below will
provide a general picture of China's investment and aid activities in some key South Asia
countries (see Figures 2 and 3) and consider hosting a military base (see Figure 4). The
figure illustrates that these projects concentrate on infrastructure, trade, and energy,
establishing pivotal components in alignment with China's BRI strategy across the
countries. This can be regarded as a profound intervention by China to fulfil its regional
strategic objectives and advance its position as the primary trade and investment partner,
surpassing India in several South Asian countries.

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Figure 2. Chinese Investments in Bangladesh, Nepal, Sri Lanka

Source: Pal (2021, p.20)

Figure 3. China's Emergence as the Key Economic Player in South Asia

Source: Nikita Kwatra and Sriharsha Devulapalli (2020)

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Figure 4. China's contemplation of hosting a military base in Pakistan and Sri Lanka

Source: The Economist, 2022

There are several implications for India's security from Chinese projects in South
Asia. First, it threatens India's strategic autonomy and its ability to play a leading role in
the region. Second, it creates a security dilemma for India, as it perceives China's growing
military influence in the Indian Ocean as a threat to its security. Third, it raises concerns
about the possibility of a military conflict in the region, particularly over territorial
disputes such as the India-China border dispute. Detailed China’s military projects and
cooperation in South Asian countries are explained within the following sections.

Bangladesh
China has supplied military equipment to Bangladesh, including fighter jets, tanks, and
submarines. In 2018, Bangladesh purchased two submarines from China, which were
seen as a significant addition to its naval capabilities. From 2010 to 2019, China
contributed 72 percent of Bangladesh's total military weapon imports (Bekkevold, 2020,
p.38). China supplies military weapons at a lower cost than its competitors. Bangladesh
splashed in 2016-17 when it ordered two Ming-class submarines from China
(Samaranayake, 2016). The capability of Bangladesh to purchase these vessels
demonstrates China's commitment to making costly weapons for developing countries
based on bilateral military assistance. In addition, China and Bangladesh have also been
conducting joint military exercises to enhance their military cooperation. These exercises
allow the two countries to share their military expertise and enhance interoperability. In

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term of economic development, China has led to significant financial support for
Bangladesh, surpassing USD 38.05 billion, approximately 10% of Bangladesh's GDP.
This amount represents the most substantial financial assistance ever pledged to
Bangladesh by a single country (Anwar, 2022). The impact of China's involvement goes
beyond financial aid, as it currently holds multiple critical positions in Bangladesh's
economy. China is the country's largest trading partner, foreign investor, trade supplier,
and exporter of military weapons. Furthermore, in 2020, China granted duty-free access
to its market for 97% of Bangladesh goods, further strengthening bilateral trade relations
(Dhaka Tribune, 2020).
The United States Institute of Peace report by Nilanthi Samaranayake (2019, p.9)
titled "China's Engagement with Smaller South Asian Countries" highlights that China
has allocated $358.4 million to improve Bangladesh's infrastructure. This funding
comprises $217.7 million in grants and $140.7 million in loans. This investment
demonstrates China's commitment to supporting developing and modernising
Bangladesh's infrastructure.

Figure 5. Chinese investment in Bangladesh

Source: Anwar (2022)

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Maldives
China has supplied military equipment to the Maldives, including patrol boats and
helicopters. In 2012, China agreed to enhance China's funding to the Maldives to 15.4
million USD, and the two countries established a military aid agreement. China's original
goal was to establish a military base in the Maldives. Nevertheless, with Sri Lanka willing
to satisfy some of China's critical maritime interests and Beijing unwilling to antagonise
the US and India, Maldives' other security allies, this ambition has taken a back seat.
However, there are allegations that China is still pursuing the Maldives to prevent a US
attempt to establish a new military base on the Maldives' southernmost island of Gan
(Kumar, 2016, p.17). In 2017, the Maldives signed a free trade agreement with China,
which included provisions for defence cooperation (Smith, 2020, pp. 7-8).
Regarding economic development, China has been a significant investor in the
Maldives' infrastructure, tourism, and housing sectors. China has financed several major
infrastructure projects in the Maldives, including constructing a new runway at Velana
International Airport and developing Hulhumale Island, a new urban centre. China has
also been involved in the development of the Maldives' ports. China has been helping the
Maldives develop the port of Male, the main commercial port. China's investment in
developing this port will enhance the Maldives' trade and tourism sectors.
Moreover, China was prosperous in developing the China-Maldives Friendship
Bridge and housing developments totalling over 7,000 apartments, spending around $210
million (Shabbir, 2021, p.7). In addition, China has leased a neighbouring island to the
Male airport for 50 years (Lin, 2018). It can be used as a military base in the "String of
Pearls" strategy to encircle and contain India in the region.

Nepal
Chinese military assistance to Nepal is still limited. In 2005, China granted Nepal
approximately 989,000 USD in military aid, primarily to confront the Maoist insurgency.
Then, China provided 2.6 million USD in military assistance for institutionalising and
modernising the Nepal Army immediately following the inaugural Constituent Assembly
election in 2008. The National Armed Police Force Academy for Nepal's paramilitary
Armed Police Force was completed in 2017 with Chinese assistance and a budget of up
to 33 million USD (Sharma, 2021). China has been supplying military weapons to Nepal,
including firearms and ammunition. China has also provided training and other forms of
military assistance to Nepal. In terms of economic development, until 2016, China has

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granted $156 million to the Pokhara airport project, which will be Nepal's second
international airport, and $55 million to general economic and technological assistance
(Government of Nepal, Ministry of Finance, 2017).
Nepal encourages partnerships with China that concentrate on establishing or
improving connections. Nepal signed an MOU with China on road and railway
connections in May 2017. In 2022, to strengthen bilateral ties, China promised Rs 15
billion in grant aid to Nepal to invest in different projects in the landlocked Himalayan
nation (The Economic Times, 2022). Nepal has received significant investments from
China to improve its infrastructure and energy sectors. China has funded several major
infrastructure projects in Nepal, such as establishing the Pokhara International Airport
and expanding the Tribhuvan International Airport.
Additionally, China has been involved in developing hydroelectric projects in
Nepal, which are anticipated to impact Nepal's energy sector significantly. Moreover,
China has contributed to developing Nepal's road and railway infrastructure. The
construction of the Trans-Himalayan railway, which will connect Nepal with Tibet and
offer a direct link to China, is being supported by China to enhance Nepal's trade and
connectivity with China.

Pakistan
As one of the most important countries in South Asia, Pakistan receives significant
military funding support from China, the only country willing to enhance Pakistan's
defence capabilities with competitive prices if Pakistan cannot purchase expensive
military weapons because of economic difficulties. From 2008-2018 (Pubby, 2019),
China provided military weapons to Pakistan up to 6,4 billion USD. China has been a
significant supplier of military equipment to Pakistan. China has provided Pakistan with
various weapons systems, including fighter jets, tanks, submarines, and missiles. In recent
years, China has also been helping Pakistan to develop its indigenous military capabilities
by providing technology transfers, joint ventures, and co-production arrangements. China
and Pakistan have also conducted joint military exercises to enhance cooperation. These
exercises allow the two countries to share their military expertise and enhance
interoperability (Muhammad, 2020, pp. 38-39). Regarding economic development,
Pakistan presently functions as the hub of BRI through CPEC. CPEC projects are
predicted to cost $62 billion when completed, with energy projects likely to account for
at least $33 billion (Hurley et al.,2018, p.19). Apart from the CPEC, China has also made

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significant investments in developing Pakistan's ports. The development of Gwadar port

as a trade and commerce hub in Pakistan is a part of this initiative, which would provide
China with easier access to the Arabian Sea and the Indian Ocean. However, China's
growing economic and political ties with Pakistan severely affect India's security. India
and Pakistan have a history of conflict, and the tensions between the two countries
continue to be high, particularly concerning the territorial dispute of Kashmir. So, India
has expressed apprehensions regarding China's investments in Pakistan, including the
possibility of Chinese military access to Pakistani ports and other sectors. When Pakistan
takes on more debt from China, it becomes increasingly beholden to its lender, potentially
compromising its national sovereignty and ability to make independent decisions.

Sri Lanka
China has supplied military equipment to Sri Lanka, including fighter jets, helicopters,
and naval vessels. In 2014, China provided Sri Lanka with two frigates to enhance its
naval capabilities. China's assistance in the establishment of the Sri Lanka Navy's high
endurance strength was the gifting of a Type 053H2G frigate, which is presently the Sri
Lanka Navy's second most extensive military equipment (Wignaraja, 2019, p.7). While
China and Sri Lanka's security cooperation remains strong, there has been no evidence of
significant bilateral military exercises since the termination of the two-staged 'Silk Road
exercise in 2015 (Wignaraja, 2019, p.7). Nonetheless, Chinese military personnel have
periodically participated in other multilateral exercises by Sri Lanka's armed forces, such
as the “Comoront Strike”.
China has also provided significant financial assistance to Sri Lanka through loans
and grants. For example, in 2018, China provided a $1 billion loan to Sri Lanka to help
finance its debt servicing requirements. Additionally, China is one of Sri Lanka's largest
trading partners, with bilateral trade between the two countries reaching $5.8 billion in
2019 (Moramudali & Panduwawala, 2022, p.5). China has also invested in several
industries in Sri Lanka, including real estate, hospitality, and infrastructure. China has
significantly invested in Sri Lanka's infrastructure and energy sectors. China has financed
several major infrastructure projects in Sri Lanka, including the Hambantota Port,
Colombo port city, and Mattala Airport, to boost Sri Lanka's economy in the region.
However, the main ambition of China in Sri Lanka is to establish a strategically located
foothold in the Indian Ocean region. The port is a crucial location along the busy sea lanes
that connect the Middle East, Africa, and Europe to East Asia, making it an essential hub

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for shipping and trade. China provided a large loan to Sri Lanka to finance the
construction of the port, which has since been leased to a Chinese state-owned company
for 99 years (Moramudali & Panduwawala, 2022, p.14). The Hambantota Port is an
essential part of China's "String of Pearls" strategy, which seeks to establish a network of
ports and other facilities along crucial maritime routes in the Indian Ocean region.

Bhutan
There has been minimal Chinese military funding and economic development in Bhutan,
as Bhutan maintains a policy of strict neutrality and does not allow foreign military bases
on its soil. However, the dispute over the Doklam plateau has heightened tensions
between China and Bhutan. While some efforts have been made to improve diplomatic
relations, Bhutan remains wary of China's intentions (Subrata et al., 2018, pp. 240-241).
China has been attempting to assert its territorial claims in the area through various means,
including building infrastructure along the disputed border and pressuring Bhutan to cede
territory. This leads to China and Bhutan needing formal diplomatic relations, but there
have been efforts to improve ties in recent years. In 2019, the Chinese ambassador to
India met with Bhutan's prime minister to discuss the BRI and other issues (Northeast
Now, 2019). However, Bhutan remains wary of China's intentions and is careful not to
get too close to one country.

Afghanistan
China's interest in Afghanistan is multifaceted, with several strategic reasons behind it.
Although Afghanistan holds significant importance for China, China's primary motive for
investing in Afghanistan is likely to contain India. China's growing economy necessitates
natural resources to fuel its progress, and Afghanistan, with its abundance of minerals
such as copper, iron ore, and lithium, is a valuable source for China's manufacturing
industries. Afghanistan's location at the crossroads of Central Asia, the Middle East, and
South Asia is another strategic advantage for China. As part of its Belt and Road Initiative,
a massive infrastructure project connecting Europe, the Middle East, and Africa with
China, Afghanistan is essential. China's global ambitions also play a part in its interest in
Afghanistan, as it seeks to expand its regional influence and build stronger ties with the
Afghan government. This has been demonstrated through China's investments in
Afghanistan.

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Since 2001, China has provided just a minor security contribution to Afghanistan.
It has committed only $250 million in assistance to Afghanistan's reconstruction ( Kley,
2014, p. 2). China has not sent military forces to Afghanistan, but it has offered limited
training to police officers and mine clearance teams. Currently, China provides diplomatic
support to Afghanistan on the global stage, advocating for its interests in forums like the
United Nations and working to improve its relations with other nations (Ng, 2010, p.3).
Beijing is actively managing Afghanistan's foreign relations to help the country overcome
international isolation. Notably, the Chinese embassy in Kabul remained operational amid
the Taliban's takeover, demonstrating support for Afghanistan's reconstruction and
economic development after the US troop withdrawal (Siddiqui, 2023). Despite the
Taliban government facing global criticism for its oppressive policies towards women,
including limiting their work and education opportunities, China remains eager to engage
with the regime, emphasising a commitment to finding a long-term solution.
While it is acknowledged that China and India have a complicated relationship
and competing interests in the region, it needs to be clarified whether China's involvement
in Afghanistan is primarily aimed at countering India. Nevertheless, China's investments
in Afghan infrastructure projects could indirectly impact Indian security. If China's
investments help stabilise Afghanistan, it could reduce the likelihood of terrorist activities
that may threaten neighbouring countries, including India. However, if China's
investments strengthen the position of the Taliban, which has close ties with Pakistan,
this could pose a security concern for India, given its strained relationship with Pakistan.

India’s Security Challenges and Prospects in South Asia Region

India faces various security challenges in the South Asia region, including cross-border
terrorism, territorial disputes, and the growing Chinese influence through military funding
and economic development projects. These challenges have significant implications for
India's security and its role as a regional power. First, cross-border terrorism is one of
India's most significant security challenges. Pakistan has been accused of supporting and
sponsoring terrorist groups that carry out attacks in India, including the 2008 Mumbai
attacks and the 2019 Pulwama attack. India has adopted a more robust counter-terrorism
strategy, including military strikes on terrorist camps in Pakistan-administered Kashmir
(Markey et al., 2022). However, the ongoing threat of terrorism has significant
implications for India's security and relations with Pakistan.

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Second, the security challenges that India is facing in South Asia are complex and
multifaceted, with territorial disputes playing an important role. India's territorial disputes
in the region include historical, geopolitical, and strategic implications for India's
security. For example, India and Pakistan have a long-standing territorial dispute over the
region of Jammu and Kashmir, which has been a source of conflict between the two
countries for decades. India also has territorial disputes with China, including the Aksai
Chin region and the Arunachal Pradesh border (Bedi, 2021). These disputes have
manifested in border conflicts and tensions, most recently in the Galwan Valley in 2020.
The ongoing territorial disputes with Pakistan and China severely affect India's security
and regional strategy.
Last, China's growing influence in South Asia also poses significant security
challenges for India. These investments have led to concerns about China's strategic
intentions and impact on India's security. India has responded by strengthening its
partnerships with other major countries, such as Japan and the United States, especially
in the military field. It is a fact that the relationship between South Asian countries and
China is complex and multifaceted, and China's growing influence in the region has
indeed created some threats to India's security and regional stability. However, it is
inaccurate to say that South Asian countries' dependence on China will inevitably lead to
India's security falling into a passive position.
Despite these challenges, India has several prospects in South Asia. India's
growing economy, military capabilities, and soft power make it a significant regional
power. Mohan (2022) stated that India is one of the most influential countries in South
Asia, plays an important role, and is a strong voice in the region's politics, economy, and
security. India still has strong relations with countries in the region, and its influence has
been growing in the upcoming years; no matter how deeply China's influences intervene
or how South Asian countries face significant challenges, India is still ready to help, as
the typical example of Sri Lanka crisis (Chowdhury, 2022). In recent years, India has
traditionally been a regional leader and has taken on a more significant role in regional
affairs.
To protect all political interests in the region, India has sought to strengthen its
ties with other South Asian countries through trade agreements, cultural and educational
exchange programs, and military cooperation. Therefore, India is also a significant player
in regional security, playing an essential role in efforts to maintain peace and stability in
the region. India's influence in the region will likely grow as it seeks to become a

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significant global economic and security power. To achieve this goal, India is fostering
partnerships with other countries in South Asia, including Bhutan, Nepal, and
Bangladesh, to provide opportunities for regional integration and cooperation (Gill,
2020). India's strategic partnerships with the United States, Japan, and Australia also offer
opportunities for regional security cooperation and balance against China's growing
influence.

CONCLUSIONS
India has faced significant security risks in South Asia due to Chinese military funding
and economic development. China's growing military presence and influence, along with
its investments in strategic infrastructure, have created an imbalance of power and raised
concerns about India's security interests and sovereignty. Establishing ports in
neighbouring countries has provided China economic and strategic advantages,
potentially compromising India's control over the Indian Ocean.
India has pursued a proactive approach to address these risks, strengthening
partnerships and asserting its foreign policy. By deepening ties with regional allies like
Japan and the United States and promoting initiatives for regional integration, India aims
to safeguard its security interests and promote stability. These measures reflect India's
commitment to strategic autonomy, seeking to diversify partnerships and reduce
dependence on external powers, especially China.
India's efforts to enhance military cooperation and defence partnerships with other
regional countries align with its objective of maintaining a balance of power. India aims
to counterbalance China's growing influence and protect its stability and sovereignty by
bolstering regional security arrangements. However, it is crucial for India to carefully
consider the interests of other countries and work towards promoting regional security
and stability rather than escalating tensions.
Overall, India's response to the security risks posed by Chinese military funding
and economic development demonstrates its determination to safeguard its national
security interests and maintain strategic autonomy. Through active engagement with
regional partners and a proactive foreign policy, India seeks to mitigate these challenges
and maintain a favourable balance of power in the South Asian region. India must pursue
collaborative approaches and avoid actions that could escalate tensions with China or
other countries while prioritising regional security and stability.

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ACKNOWLEDGMENT
I want to express my sincere gratitude to the reviewers and my advisor, who have
contributed to the completion of the article with excellent comments and suggestions.

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