US-China Rivalry in South Asia: Strategic Autonomy Challenges for India

Indian Express - Opinion · 7 Jul 2026 · 2 min read
Prelims · International relations Mains · GS2 International relations High relevance

The US is shifting its Asia strategy to accommodate China's rise, reducing India's centrality in its Indo-Pacific calculus while expanding engagement across South Asia, compelling India to adopt a transactional approach to preserve strategic autonomy.

Key points

US Strategic Shift: The US is recalibrating its Asia strategy, moving from containment to treating China as a G2 partner, reducing India's role as a counterweight and focusing on economic ties.

China's Regional Influence: China's 'string of pearls' strategy, including CPEC and BRI projects in Nepal, Bangladesh, and the Maldives, has entrenched its economic and strategic presence in India's neighbourhood.

US Engagement in South Asia: Washington is deepening defence and infrastructure ties with Bangladesh, Sri Lanka, Nepal, and the Maldives, challenging India's traditional sphere of influence.

Pakistan's Strategic Value: Both US and China view Pakistan as a counterweight to India, leveraging its nuclear-armed status and Sunni-Shia diplomatic reach in West Asia.

India's Trade Surplus: India's trade surplus with South Asia grew from $6.7 billion to $20 billion over two decades, but political challenges persist due to dysfunctional SAARC and fluctuating bilateral relations.

[GS3-Economy] India's manufacturing and AI sectors must reduce dependence on Chinese industrial inputs to strengthen economic sovereignty amid US-China rivalry.

[GS2-International Relations] The Quad's diminishing strategic focus under US recalibration highlights the need for India to bolster trilateral cooperation with Japan and Australia.

Way Forward: India should prioritize domestic manufacturing in semiconductors and critical minerals, maintain transactional relations with both US and China, and accelerate connectivity projects with neighbours to counterbalance external influence.

Key terms

String of Pearls

China's strategic initiative to establish naval and commercial bases in the Indian Ocean region, including ports like Gwadar and Hambantota, to enhance its geopolitical influence and secure energy supply routes, directly challenging India's regional dominance.

Quad

The Quadrilateral Security Dialogue involving India, US, Japan, and Australia, aimed at ensuring a free and open Indo-Pacific. Its relevance is now questioned as US shifts focus from containment to G2 engagement with China.

Strategic Autonomy

India's foreign policy doctrine of maintaining independent decision-making in international relations, avoiding alignment with any major power bloc, crucial for balancing relations with US and China amid their rivalry.

CPEC

The China-Pakistan Economic Corridor, a $62 billion BRI project linking Xinjiang to Gwadar Port, raising sovereignty concerns for India as it passes through Pakistan-occupied Kashmir, violating territorial integrity.