The sooner the better that India and China accept their inevitable strategic competition but limit that by working overtime on tactical cooperation. Two tactical areas needing immediate Chinese and Indian intervention are a fix for the world economy and overcoming terrorism from Afghanistan and Pakistan affecting them both.

The Asia-Europe (ASEM) meeting on 24 October in Beijing where prime minister Manmohan Singh was feted as a star economist by the Chinese premier, Wen Jiabao, sets the ball rolling for Asian ideas to spearhead the rescue of international finance. And in December, India will host the second counter-terrorism joint military exercise with China, which has fortunately survived the downturn in bilateral relations for most of this year. 

China fears the Indo-US nuclear deal. Unable to stop it in the Nuclear Suppliers' Group (NSG), it has not said no to Pakistan's matching demand for it, only constrained by certain international opposition of it and by grave doubts of Pakistan's stability. But the Indo-US deal, far from expanding India's deterrent, constraints it by obligations not to test and not to provoke a nuclear arms race with Pakistan. Indo-US military-to-military ties also raise Chinese hackles. China (and Russia) expressed concern over the 2007 Malabar war games in which India, the US, Australia, Singapore and Japan participated.
 
India has not psychologically gotten over the 1962 Chinese aggression, blames Chinese proliferation for Pakistan's military nuclear and missile programmes, accuses China of encircling it with Indian Ocean bases like a "string of pearls", and is alarmed by Chinese naval power growth and its reach in the Indian Ocean. To that add Indian anger about Chinese "deviousness" in the NSG, publicly conveying neutrality on the nuclear deal but privately undercutting it, and being duplicitous on a permanent UN Security Council (UNSC) seat for India. Only days before Manmohan Singh's ASEM visit to Beijing, China was found lobbying against India alongwith the so-called "Coffee Club" countries that include Pakistan, Italy, Egypt and Turkey. Even as Manmohan Singh was proceeding to Beijing, the Indian foreign minister, Pranab Mukherjee, told Parliament that progress on India's border dispute with China was not "very bright".
 
Deep-rooted suspicion on both sides has failed to be staunched by three rounds of strategic dialogue, twelve rounds of special representatives' talks on the border dispute, and not-infrequent summiteering. This has been, for example, Manmohan Singh's second high-level contact with the Chinese leadership in a month. The PLA was thought earlier to trip the political leadership on relations with India. Chinese troops' transgressions in Arunachal Pradesh, an Indian state that China claims, probably results from PLA hard line. But lobbying against India in the NSG or for a permanent UNSC seat has to have overall leadership approval.

On the Indian side, the earlier diffidence with respect to China has been replaced by erratic defiance, which does not help. China's obstructive role in the NSG was widely and angrily publicised by the Indian bureaucracy, until the pragmatic US line that Beijing had after all let the nuclear deal go through revealed the short-termism of Indian diplomacy. Again, the leak of Chinese "Coffee Club" interactions and Pranab Mukherjee's "no progress" statement on border talks could not have made Manmohan Singh's interactions with the Chinese leaders easier, especially when the PM has had to be defensive on the security agreement signed with Japan en route to China.

If all the leaks and negatives against China had been part of the PM's discussions, and revealed if the outcome was unsatisfactory, wouldn't that have been wiser? This way, you presume failure, while success comes by chance, which is probably not how leadership talks are programmed. Further, the security arrangement with Japan is a needless irritant with China, unless Japan is plainly told there is no national security without nuclear weapons in this dawn of a new Cold War, and that Japan recognise and privilege India as a nuclear weapons' power. This means assisting India with civilian nuclear cooperation. Japan's own dilemmas about weaponisation notwithstanding, it can no longer paper over its agonising internal debates.

What causes India to erratically defy China? Very likely, a gross oversimplification and magnification of India-US relations since the nuclear deal and growing military-to-military ties. If indeed the US is building up India as an Asian counterweight to China, as some in the Indian establishment believe, it is going about it a queer way by severely circumscribing India's deterrent capability through the nuclear deal. Frankly, in the NSG waiver for India, the US and China were on the same side. US newspapers leaked that the US privately assured opposers that India would be bound not to test and would be denied enrichment and reprocessing rights and technologies.  

Rather than flex phantom muscles, India would be well-advised to objectively assess its true strengths, and deal with China on a level of its comfort. And rather than erratic defiance, India should solidify anti-terror links with China, which took the extraordinary step of publicising East Turkistan terrorists that it hints are being trained in Pakistan and Afghanistan. And India and China have a real opportunity to pool their talent and assist the world out of the economic crisis. But all this is done better with plain acceptance on both sides of strategic competition, which can then be gradually minimised.