To jaw-jaw is always better than to war-war.
—- Winston Churchill
China needs India. India needs China. Thus, both countries keep looking to mend their fences than fight it out.
Just as India feels encircled by China, China feels encircled by the US. US has bases all over China’s east [Japan, Korea, Taiwan] and China’s relationships with its southern neighbors [Vietnam, Philippines] are not that good and marred by territorial disputes. US has a sizable influence there too. In the north, there is Russia/Mongolia with whom China has had often frosty relationships. China cannot afford yet another rival/enemy in its west too.
Thus, Xi has been in an effort to win its neighbors and reduce the tensions. China Counters Trump by Mending Fences From Japan to India
In the same way, Modi has been mending fences around the world. He enjoys great chemistry with major world leaders from Trump to Merkel to Abe to Netanyahu. Even with Pakistan, he made significant overtures in good faith [inviting Sharif to his inauguration ceremony and visiting him on his daughter’s birthday].
Unlike many hardliners at home, Modi knows how important it is for India to develop good relationships and how silly it would be to fight other countries given the monumental challenges at home.
India needs China’s approval to get into the NSG or UN Security Council. China has gone slightly hard on Pakistan recently as a result of the warming ties with India [Should Pakistan be alarmed as BFF China gets pally with India?]. We cannot afford to ignore this large a neighbor and this big an economic partner.
Modi’s critics thought he would be the big hawk fighting everywhere - whereas he has shown to be a dove building peace.
(Source:https://www.quora.com/profile/Balaji-Viswanathan-2)
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