Tensions between China and India have eased off a bit weeks after a border skirmish put bilateral ties to the test in a year that marks the 70th anniversary of the establishment of diplomatic relations.

On Monday, both sides agreed to avoid further escalation along the border areas. They also decided to accelerate the implementation of agreements reached at military commander-level meetings and to complete the "disengagement" of both troops as soon as possible.

The latest development sends out positive signals that the world's two most populous countries have the desire to ease tensions. Only months ago, the leaders of both nations promised to "further deepen and strengthen "the Closer Developmental Partnership agreed in 2014 and to "take it to a new level."

However, the disengagement plan is insufficient to elevate bilateral relations to "greater heights in the years to come," especially when political forces in India are agitating nationalism and pushing for decoupling from Chinese manufacturing.

It is logical that India wants to strengthen its manufacturing capacity, especially during the second term of Prime Minister Narendra Modi, who led the country to overtake Britain and France to become the world's fifth largest economy last year. The question is, though, how can India efficiently reach its goal when the world is facing an economic recession amid the uncertainties aggravated by the coronavirus pandemic?

For example, India is a major pharmaceutical supplier in the world. However, about 70 percent of its active pharmaceutical ingredients (APIs), the key components for making medicines, come from China. As industry insiders have pointed out, there are not many alternative API manufacturers, so distancing itself from its primary supplier will only backfire on the Indian pharma sector.

The coronavirus pandemic has, to a certain extent, had the effect of decoupling India from China as it slows down transportation and business activities. It has also allowed the National Pharmaceutical Pricing Authority, which controls the prices of drugs in India, to permit companies to increase the ceiling price of heparin, a life-saving medication, by 50 percent until the end of the year.

Further restrictions by authorities to delay or hinder Chinese goods from entering India will only cause more pain to drug manufacturers in the country, thereby reducing their ability to cater to domestic consumers and hampering their competitiveness on the global market.

The same logic applies to other sectors, including infrastructure construction, power equipment supplies and digital technology, where the two countries have close links. Disruption of two-way cooperation in those fields, higher duties on imports from China and tighter restrictions on Chinese investments will lead to fewer job opportunities, reduced incomes and higher living costs. 

This approach will eventually hurt the interests of the public in India at a time when livelihoods are already hit hard by the global economic downturn and the coronavirus pandemic. The damage to India would be far more disastrous than to China, as many analysts have pointed out.

China didn't become a global manufacturing center by decoupling from national economies. Instead, it has embraced other countries, competitors included, and has reaped the benefit of reinforcing its economic capacity.

Looking ahead over the coming decades, it is only through a closer partnership rather than decoupling that the world's two largest developing nations can implement their respective rejuvenation plans. As Prime Minister Modi once said, "[they are] two bodies with one spirit" and neither can get enough sustenance from narrow-minded nationalism.

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