India China Conflict: A Matter Between Two Nations Or A Dreadful Impact On The Global Economy?

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India and China once said to be friends have recently turned into foes over a dispute regarding the undefined border between both countries since 05 May 2020. India and China are neighbouring countries and did not have any problem in dealing with the matters of both nations peacefully. However, the situation has seen a major shift during the recent months and seems nowhere to end in the coming months as well.

 

This situation did not arise all of a sudden. Both the nations have been in a backlash since 1962 when they first confronted each other in the Indo China war over the contested borders in the Himalayas. It was then that the border or Actual Line of Control was named. Since then both the countries have felt an uneasy and frangible peace. But the matter was highlighted when the Indian and Chinese troops were engaged in an aggressive brawl along the Sino-Indian border which includes the disputed Pangong Lake in Ladakh and the Tibet Autonomous Region and also in the area near the border of Sikkim and Tibet Autonomous Region. 

Why the dispute?

India and China have struggled to settle in accordance with each other over the disputed border between the two nations. Both of them are competing with each other to build infrastructure over the land. India’s construction over the actual line of control to build a road to high altitude airbase incited the fire in china causing a clash between the two nations leaving at least 20 Indian soldiers dead. This was the first confrontation between India and china since 1962 and can be said that the two are not keeping up with truce conditions ever since and the relations have degenerated ever since. 

When in August, India indicted china of provoking military tensions twice within a week, china decided to stay quiet on the comment. This has just added the fuel to the fire and has not helped much in any case. These accusations have not been proved yet, as it was signed in an agreement that no gunshots will be fired at the border to maintain peace. That is why the recent confrontation in June was fought with sticks and stones instead of guns. However, no claims have been true until now.

What has the world to do with it?

Most of the nations and its people are left in wonders that if the two neighboring countries are in a state of war with each other then why should it have any effect on the global economy? The bigger question which arises in their tiny brains is will it even affect the economy?

The answer to all these questions is yes! 

If these two nations namely India and China are on the verge of sinking, let us be very clear about the fact that they are going to take everybody down with it. And why would be that?

 the conflict between India and China is no more limited to the military. It has become a serious concern for the world economy.

How will the Indian China conflict affect the world economy?

It is for a fact that China is the biggest exporter in the world which exports a total of $2500 US billion in a year. It is natural enough that the countries would be having trading relations both with India as well as china. This would cause global tension between most of the nations to support which nation. Here’s how?

Most of the technological sector of the world pretty much revolves around these two nations. China is said to be the hardware hub of the technology, most of the fortune 500 companies like Apple, Samsung, Infosys have their hardware manufacturing plants established in China while the service and software designs are managed by India. And let us face it, a product cannot run on just hardware or software which leaves the nations in a bigger dilemma to support which one of the two. If they try to establish their manufacturing plants in India, it is very sad to know that the country does not have enough resources to meet the demands. However, the news has floated that Apple will establish its first manufacturing plant in Chennai, India, and has already manufactured its flagship iPhone 11 at the same plant. The same goes for China. The software solutions which are provided by the country are not much convincing and do not work as smoothly as they should. As of 2019 Samsung has scaled back production in China as the market share fell below 1% in the country. This was about the technology department

If we were to come out of it, the unnoticeable fact is most of the US businesses such as general motors, Starbucks, Nike, Boeing and many more rely heavily on China as they have most of the manufacturing units in the country. This would become a difficult call to take because American businesses work in much harmony in India also. With companies like JP Morgan, Johnson&Johnson the major profits are generated by India. also, Tata Services is the second-largest global supplier of tea along with TCS being the third largest IT developer in the world. 

China and India have not been friends exactly since the 1962 indo china war. But both the nations have been the rich land for natural resources. China accounts for a significant part in the export of natural resources like coal, aluminum, copper, and iron ore. In 2017 china was the major trading partner for exports in countries like the united states of America, hong kong, japan, and Korea. The united states of America have been a major import for Indian resources as well along with the United Arab Emirates and hong kong. India is also a major exporter of mineral oils and pearls to different nations in the world.

The verdict: 

Looking at the facts and figures the situation has created tension in the mind of leaders of some of the great nations. The economic aspect is very frightening for the two countries which are at war along with the nations who will be in support of the two. Nobody knows how this affair would be settled as these are no two small countries. We are talking about two nuclear-established superpowers. And if push comes to shove there may be devastating effects for the whole world leaving us in a situation as close to eternal damnation.

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