The recent visit by China's Supreme Councillor and special representative Dai Bingguo for the 15th round of border talks was marked by uncharacteristic bonhomie. Even making allowances for extra warmth shown by his host Shivshankar Menon and reciprocated by Dai during his farewell visit - he retires later this year - the near bhai-bhai spirit of the trip hints at a deeper change in relationship. After flexing its muscles for two years and watching with concern the slow coalescence of resistance to its power, China seems to have readjusted its trajectory. Fence-mending with India, its largest neighbour and a potential member of an opposing bloc, has become a new priority. Time will tell if this is a tactical shift or a strategic reorientation.
In this year of its own political transition and in the face of both regional and global instability, China offers a copybook argument for a change of tack. It wants peace and stability along its borders and friendly relations with Asian neighbours when the current leadership of President Hu Jintao and Premier Wen Jiabao hands over power to next generation leaders. Improving tense relations with the US will have to wait until the November elections when the next occupant of the White House will be decided. China invariably comes up for a beating during American election campaigns. But mending relations with neighbours frayed by its assertive moves in the past two years can begin whenever China is ready.
China's fracas with Japan over contested islands nearly caused an armed clash. Naval encounters with Vietnam and a tense stand-off with the Philippines over the South China Sea waters, and China's warning to India for its oil exploration in Vietnamese waters, have all added to the growing sense of an arrogant China imposing its will. China's shrill campaign against Indian control of Arunachal Pradesh and the presence of the Dalai Lama in India have been followed up with reminders about China's non-acceptance of Indian control of Kashmir through the issue of stapled visas.
But in 2011 China watched with concern as even the usually docile Southeast Asian nations stood up to it and, more worryingly, called on the US to return to the region as a counterweight. President Obama, who came to power seeking a duopoly with China and bent over backwards to accommodate its interests, was rebuffed by a super-confident Beijing basking in world adulation of its rising power. The tables were turned when Hillary Clinton stepped into the South China Sea dispute and Obama travelled to Asia to proclaim that America was back.
To add to China's worries, three of its close neighbours have shown signs of wobbling. Myanmar, long considered to be in China's pocket, stunned China by abruptly cancelling a $3.6 billion hydroelectric project and inviting Clinton to visit. As a price for better relations with the US, Myanmar has freed in one go the largest number of political prisoners in Asia. China is deeply concerned about the growing power of extremists in Pakistan where a large number of Chinese aid workers have been killed, though the news of such losses has been kept secret. Support of Pakistani extremists to Uighur separatists in Xinjiang has brought rare public rebuke from China. If the US-Myanmar warmth is galling to China, the sharp deterioration of Washington's relations with Islamabad is a matter of concern too.
The death of Kim Jong-il has also brought new anxiety about the stability of North Korea, the poor, nuclear-armed country on its border. Any instability in the hermit nation ruled by a 28-year-old neophyte could send millions of hungry refugees across the border to China, perhaps opening the door to western intervention.
The Chinese have told Indian diplomats that they worry that the US is trying to prevent China's rise by lowering the value of the dollar (thus weakening China's vast dollar-denominated assets) and subverting its socialist society through promotion of toxic ideology and culture through the internet. In the face of multiple threats and challenges, China seems to have concluded that mending relations with India and making common cause on issues they agree upon would be a wise course of action. India has to see if Chinese overtures are more than a mere tactical shift.