CHINA AND INDIA IN ASEAN

In the past decade, Southeast Asia has emerged as the epicentre of Asia’s strategic and economic transformation. The ten member states of the Association of Southeast Asian Nations (ASEAN) stand at the crossroads of global trade, maritime connectivity, and geopolitical contestation. Both China and India increasingly view the bloc as pivotal to their regional strategies: for Beijing, a key partner in advancing trade, technology, and security interests; for New Delhi, the cornerstone of its Act East Policy (AEP).

Since its launch, the AEP has evolved from a diplomatic outreach initiative into a comprehensive framework for strategic and economic engagement. India has steadily deepened its cultural linkages, expanded defense cooperation and increased participation in ASEAN-led forums. In parallel, China has pursued an ambitious and institutionalized agenda through mechanisms such as the ASEAN–China Free Trade Area (FTA 3.0) and the Belt and Road Initiative (BRI), accelerating the pace and depth of regional integration.

China’s engagement over the past decade reflects a multidimensional strategy. Moving beyond bilateral relations, Beijing has constructed an extensive architecture of economic, infrastructural and diplomatic partnerships with the ASEAN member countries. Its growing role is not confined to commerce or infrastructure; it extends into maritime cooperation, regional rule-making and narrative shaping.

In this increasingly complex and contested environment, India confronts a dual imperative: to operationalize the strategic potential of the AEP while responding to the growing benchmark set by China’s expansive outreach. The question is no longer whether ASEAN matters to India, but whether India can translate its AEP vision into sustained, tangible influence - one that prioritises ASEAN’s developmental needs while safeguarding its own strategic interests. In this regard, China’s engagement provides both a challenge and a reference point for evaluating the effectiveness, scale and ambition of India’s evolving strategy in Southeast Asia.

China’s Multifaceted Engagement with ASEAN

Under Xi Jinping’s regime, China has moved from episodic engagement with Southeast Asian countries to a sustained and institutionalized partnership with ASEAN member countries. What was once neighborhood diplomacy driven by proximity has evolved into a comprehensive strategy encompassing trade, infrastructure, maritime cooperation, conflict mediation and political dialogue. At the heart of this engagement lies Beijing’s intent to integrate its economy with ASEAN’s development trajectory, positioning itself as the region’s most influential external partner.

The deepening of China–ASEAN bilateral trade, reinforced by Beijing’s participation in the Regional Comprehensive Economic Partnership (RCEP), marks a structural shift in regional economic integration, underpinned by both policy alignment and market interdependence. Since ASEAN became China’s largest trading partner in 2020, bilateral trade has continued on an upward trajectory, reaching approximately US $694 billion in the first eight months of 2025 - a nearly 10 percent year-on-year increase. This growth reflects more than traditional commodity exchanges; it signals a qualitative transformation toward a diversified economic relationship encompassing services, digital commerce and technology cooperation. The BRI has played a pivotal role in facilitating this expansion, with the development of logistics hubs, industrial corridors, and port infrastructure across Southeast Asia enhancing connectivity and streamlining regional supply chains. These BRI-driven linkages have not only deepened China’s economic integration with ASEAN but also reinforced its structural influence over regional trade networks.

A pivotal milestone was the completion of the China–ASEAN Free Trade Area Upgrade (FTA 3.0) in May 2025. By broadening cooperation to include digital trade, the green economy, and supply-chain resilience, the upgraded FTA reflects a recalibration of China’s regional economic strategy. President Xi Jinping framed this upgrade during his 2025 visit to Malaysia as a strategic response to rising protectionism and economic decoupling, underscoring Beijing’s broader ambition to position itself not only as an economic partner but also as a normative leader advocating openness, inclusivity and regional stability.

This high-level rhetoric serves as more than mere symbolism; it functions as a deliberate instrument of statecraft designed to reinforce China’s image as a benign, stabilizing force amid shifting global dynamics. By anchoring its engagement in principles of cooperation, peace and mutual development, China positions its approach in contrast to Western norms that emphasize liberal democratic governance and a rules-based order rooted in universalist values. In doing so, Beijing establishes a discursive benchmark that other regional actors, including India, are implicitly expected to navigate or respond to. The convergence of robust trade volume, institutional upgrades, and political signaling thus reveals a multidimensional strategy that fuses material interdependence with narrative framing to entrench China’s role as ASEAN’s preferred external partner.

Infrastructure and connectivity form the second important pillar of China’s engagement, with the BRI serving as its cornerstone since 2013. Rather than isolated construction projects, the BRI functions as a long-term platform for embedding Chinese influence within Southeast Asia’s physical and economic landscape. Flagship ventures such as the China–Laos Railway (the region’s first cross-border high-speed rail, completed in 2021) and Indonesia’s Jakarta–Bandung High-Speed Rail exemplify the scale and ambition of the BRI. Complementary projects, including Cambodia’s Phnom Penh–Sihanoukville Expressway and Malaysia’s Qinzhou Industrial Park, further cement China’s influence over regional connectivity.

These infrastructure projects extend beyond economic development; they operate as conduits for exporting Chinese technical standards, financing mechanisms and institutional models. This alignment with China’s economic and strategic priorities reflects a sophisticated calculus: leveraging connectivity as a form of soft power that simultaneously addresses development gaps while institutionalizing Chinese norms within Southeast Asia’s growth narrative. At the 17th China–ASEAN Expo in 2020, President Xi articulated this vision within the Strategic Partnership Vision 2030 framework, urging intensified connectivity and coordinated development planning. This signals China’s intent to use infrastructure not merely as an economic tool but as a foundation for long-term strategic alignment.

The third critical dimension is China’s diplomatic and security cooperation with ASEAN, which complements its economic and infrastructural engagement by embedding influence through institutional legitimacy rather than coercion. China consistently emphasizes ASEAN’s centrality in its regional diplomacy. Foreign Minister Wang Yi’s depiction of Southeast Asia as a priority for building a “community with a shared future for mankind” illustrates Beijing’s effort to align its expanding presence with ASEAN’s self-perception as the institutional cornerstone of regional cooperation.

The Head of State diplomacy further reinforces this alignment. President Xi’s 2025 state visits to Vietnam, Malaysia, and Cambodia projected a vision of shared modernization and mutual prosperity, while Premier Li Qiang’s remarks at the China-ASEAN-GCC Summit in Kuala Lumpur underscored free trade and opening up across regions as antidotes to global protectionism. Such coordinated messaging frames China not as a regional hegemon but as a cooperative partner committed to stability, development, and multilateral norms. At the heart of China’s diplomatic approach is the strategic use of normative language - emphasizing ASEAN centrality, mutual respect, and rule-based cooperation - to legitimize its influence within the regional institutional order.

Amidst these burgeoning engagements, a particularly sensitive dimension of China’s engagement concerns maritime security in the contested South China Sea. While Beijing maintains firm territorial claims, it has sought to manage tensions through ASEAN-led institutional mechanisms. Initiatives such as the Declaration on the Conduct of Parties in the South China Sea (DOC) and ongoing negotiations for a Code of Conduct (COC) demonstrate China’s willingness to engage within ASEAN frameworks. Concurrently, China promotes practical cooperation on marine environmental protection, scientific research, and search-and-rescue operations to build trust and project an image as a responsible maritime neighbour. Strategically, Beijing pursues a “dual-track approach,” favouring bilateral negotiations with individual claimant states to manage territorial disputes while simultaneously engaging ASEAN to preserve collective regional stability—thereby sidestepping the constraints of the UNCLOS judgement without overtly rejecting multilateral dialogue. This approach limits external involvement and enables China to shape regional norms from within, a strategy that advances its maritime interests while reinforcing its role as a key architect of the emerging regional order.

Overall, China’s diplomatic and security engagement with ASEAN is neither ad hoc nor transactional; it constitutes a long-term effort to institutionalize its regional presence, align its influence with ASEAN’s normative frameworks, and project a rules-based image amid intensifying geopolitical competition.

From Look East to Act East: India’s Expanding Role in ASEAN

Similarly, India’s engagement with ASEAN countries has evolved considerably since the early 1990s, when the Look East Policy reoriented New Delhi’s foreign and economic priorities toward the Indo-Pacific. Since 2014, this initiative has been revitalized as the AEP, marking a deliberate shift from diplomatic rhetoric to pragmatic implementation. Over the past decade, India has notably deepened its ties with ASEAN member states, exemplified by its elevation to ASEAN’s Comprehensive Strategic Partner in 2022. During this period, New Delhi has consistently reaffirmed ASEAN’s central role in its AEP framework. Emphasizing trade, investment and connectivity, India has sought to strengthen bilateral relations across diverse domains.

Economically, ASEAN has emerged as a vital trading partner, accounting for nearly 10.09% of India’s global trade. Bilateral trade surged from approximately USD 76.5 billion in FY 2014-15 to USD 120.9 billion in FY 2023-24, with India’s exports to ASEAN growing from USD 31.8 billion to USD 41.2 billion in the same period. Among ASEAN nations, Singapore ranks sixth in India’s global trade volume, totaling USD 35.6 billion in FY 2023-24. Moreover, the arrangement allowing trade settlement in Indian Rupees and Malaysian Ringgit underscores the deepening economic integration between India and Malaysia. 

Nonetheless, India’s participation in regional supply chains, particularly in electronics, pharmaceuticals, and digital services, remains modest compared to China’s. Yet, it is steadily rising, supported by India’s export growth through schemes like Make in India, the Production-Linked Incentives (PLI) and investments from Singapore, Thailand, and Vietnam. These trends indicate that India’s economic outreach, though more targeted and less expansive, is becoming increasingly resilient.

Connectivity has emerged as a cornerstone of India’s engagement with ASEAN, reflecting New Delhi’s conceptualization of Southeast Asia as its “extended neighbourhood.” Through this lens, India seeks to enhance both land and maritime linkages to facilitate economic integration, strategic convergence, and regional interdependence. Initiatives such as the India–Myanmar–Thailand Trilateral Highway and the Kaladan Multimodal Transit Transport Project, with plans to extend corridors to Laos, Cambodia, and Vietnam, aim to physically link India’s northeastern states with Southeast Asian countries. Bringing India’s Northeast in the AEP initiative further highlights the nexus between domestic development and external engagement. A notable development in the maritime domain is India’s deepening Indo-Pacific strategy, which includes port infrastructure projects under PM Modi’s “Sagar Mala Project”. Under this initiative, India is collaborating with Indonesia to develop a deep-sea port in Sabang and has constructed the Sittwe port in Myanmar’s Rakhine State, which began receiving container ships from India last year.

In digital connectivity, India and Singapore successfully linked their domestic payment platforms- India’s Unified Payments Interface (UPI) and Singapore’s PayNow- in February 2023, facilitating around 3,000 cross-border transactions monthly. Building on this success, the Reserve Bank of India, in collaboration with the Bank for International Settlements and central banks from Malaysia, the Philippines, Singapore, and Thailand, launched “Project Nexus” in July 2024 to expand UPI’s reach across ASEAN’s payment systems, promising to further strengthen economic ties.

Culturally and diplomatically, India’s approach continues to resonate deeply within ASEAN societies, drawing on shared civilizational heritage, Buddhism and historic maritime connections. Programs like the ASEAN–India Youth Summit, Delhi Dialogue, and the ASEAN–India Network of Think Tanks reinforce India’s image as a culturally proximate and intellectually engaged partner. India’s democratic values and advocacy for an inclusive, rules-based regional order align closely with ASEAN’s preference for strategic autonomy and consensus-based diplomacy. 

In the security realm, India has steadily deepened its cooperation with ASEAN through multilateral platforms such as the East Asia Summit (EAS), ASEAN Regional Forum (ARF), and ASEAN Defence Ministerial Meeting-Plus. Collaborative efforts like the Singapore India Maritime Bilateral Exercise, and coordinated maritime patrols with Indonesia and Thailand have enhanced interoperability and built mutual trust. Launched in 2019, the Indo-Pacific Oceans Initiative (IPOI) serves as a strategic framework for cooperation on maritime security, disaster relief, and blue economy development—areas where ASEAN countries recognize India as a capable and non-coercive partner. Affairs Minister Dr. S. Jaishankar emphasized at the 2024 ASEAN–India Foreign Ministers’ Summit, India’s and Indo-Pacific vision reaffirm ASEAN centrality and are “not to counter any country but to build a region where all can prosper on their own terms.” This statement highlights New Delhi’s commitment to an inclusive, cooperative approach that contrasts with more coercive regional actors and reinforces ASEAN’s pivotal role in shaping regional security architecture.

Nonetheless, the AEP faces structural challenges. Bureaucratic delays, limited project financing, and a slower pace of regional integration have tempered expectations. Unlike China’s BRI, which benefits from state-backed financing, India relies largely on grant assistance and multilateral partnerships that, while transparent, often progress more slowly. Additionally, India’s withdrawal from the RCEP in 2019—driven by concerns over market access and domestic industry protection—has somewhat limited its economic leverage in Southeast Asia. However, ongoing review of the ASEAN India trade in goods agreement (ATIGA) to enhance its effectiveness, accessibility, and trade facilitation capabilities signal New Delhi’s intent to bridge this gap through incremental yet focused engagement.

In sum, the AEP remains a work in progress: steady, institutionally grounded, and increasingly strategic. Although India’s economic footprint in ASEAN is not yet on par with China’s economic influence, its emphasis on trust, transparency, and cultural connectivity provides a durable foundation for deepening ties. The key challenge ahead lies in converting these strengths into sustained influence through faster project implementation, trade diversification and a stronger strategic presence within ASEAN-led mechanisms.

Strategic Crossroads in Southeast Asia

China and India both recognize ASEAN as a crucial partner in their regional strategies, yet their approaches differ significantly in focus, style, and underlying principles. China’s engagement exemplifies strategic materialism, driven by connectivity diplomacy, expansive trade, and economic influence through initiatives like the BRI and the upgraded China–ASEAN Free Trade Area. This approach has created extensive physical linkages and market integration, but it has drawn criticism within ASEAN for perceived asymmetry, lack of transparency, and an emphasis on infrastructure projects that sometimes overshadow institutional reciprocity. In contrast, India’s AEP is rooted in normative and developmental regionalism, emphasizing trust-building, inclusive growth, and respect for ASEAN’s centrality. This aligns closely with Southeast Asia’s preference for consensus-based, non-coercive partnerships. However, India faces the challenge of converting these normative strengths into concrete outcomes due to delayed project delivery and inconsistent diplomatic efforts.

Economically, China is ASEAN’s largest trading partner, with its engagement characterized by large-scale industrial supply chains and investment-led growth, which has deepened interdependence but also generated structural dependencies for some ASEAN economies. India’s economic footprint, while smaller, is more focused on knowledge-intensive sectors like information technology, pharmaceuticals, and digital services. These areas complement ASEAN’s developmental priorities by encouraging diversification and technological advancement rather than dependence on heavy industry. Enhancing trade facilitation under the ASEAN–India Free Trade Agreement (AIFTA) and expanding digital cooperation could help India carve out a niche strategic complementarity within ASEAN’s economic landscape.

Connectivity highlights another key contrast. China’s vast network of transport corridors and port developments across mainland and maritime Southeast Asia underscores its infrastructural dominance but raises concerns about sustainability, debt risks and strategic leverage. India’s connectivity projects progress at a slower pace but reflect a distinct strategic vision: linking India’s northeastern states with ASEAN through inclusive, regionally integrated infrastructure. Accelerating these initiatives would bolster India’s physical presence and align closely with ASEAN’s Master Plan on Connectivity 2025.

Security and normative engagement further differentiate the two. China participates actively in ASEAN-led security forums like the ASEAN Regional Forum and East Asia Summit but faces criticism due to its assertive South China Sea policies, which some view as coercive. India’s security cooperation is more modest but emphasizes partnership through mechanisms like ADMM-Plus and bilateral naval exercises, focusing on maritime capacity-building, humanitarian assistance and blue economy. India positions itself as a norm entrepreneur, promoting inclusivity, transparency and collective security, 

Normatively, China’s rhetoric of “win-win cooperation” and support for ASEAN centrality contrasts with practices that often reinforce hierarchical dependencies. India advocates a partnership model based on mutual empowerment, appealing to ASEAN’s desire for strategic autonomy and a rules-based Indo-Pacific order. Yet India’s limited economic scale and slower project delivery have constrained its ability to fully capitalize on this normative advantage.

Ultimately, both powers share an interest in a stable, integrated and prosperous Southeast Asia, but their divergent strategies reveal different visions of regional order. China seeks to reshape regional architecture through economic predominance, while India aims to uphold it through inclusive institutional engagement. For ASEAN, this duality offers both a challenge and an opportunity. For India, the strategic imperative is to operationalize its comparative advantages - trust, democratic credibility, and digital innovation - by delivering tangible economic, infrastructural, and security outcomes. Doing so would enhance India’s relevance in ASEAN’s strategic calculus and contribute to an Indo-Pacific equilibrium based on pluralism, partnership and shared prosperity rather than domination.

Bridging Strategy and Impact

India’s AEP has established a foundation for meaningful engagement with ASEAN, but the analysis of regional dynamics indicates significant opportunities for India to deepen its influence and translate its strategic intent into tangible outcomes. India’s AEP has evolved into a multidimensional engagement framework that aligns with ASEAN’s vision of an inclusive, rules-based regional order. Grounded in democratic values, shared cultural linkages, and a commitment to development-oriented cooperation, the AEP positions India as a natural partner for Southeast Asia. However, the expanding scale and institutional depth of China’s outreach - across trade, infrastructure, connectivity, and security - has raised the bar for regional influence. In this context, India must now move decisively from a posture of strategic intent to one of sustained delivery. The objective is not to emulate China’s model, but to operationalize India’s comparative strengths - such as its democratic legitimacy, technological innovation, and people-centric development approach - into a more coherent, outcome-driven ASEAN strategy.

To this end, India should prioritize the modernization of the AIFTA by expanding its scope to include emerging sectors such as digital trade, green technologies, and cross-border services. Improving trade facilitation mechanisms and reducing non-tariff barriers would not only enhance market access but also incentivize Indian and ASEAN businesses to co-invest in future-oriented sectors. Concurrently, accelerating connectivity projects like the India–Myanmar–Thailand Trilateral Highway and the Kaladan Multimodal Transit Transport Project remain critical. These initiatives must be completed within clear timelines and scaled to include other ASEAN countries, in alignment with the Master Plan on ASEAN Connectivity 2025. Greater collaboration with multilateral institutions such as the Asian Development Bank and Japan’s JICA could augment financing and technical expertise, ensuring that connectivity is sustainable, inclusive and strategically aligned.

India’s growing strength in digital public infrastructure also provides a compelling platform for deepening engagement. Successful initiatives like the UPI–PayNow linkage with Singapore and the ongoing Project Nexus with other ASEAN central banks should be expanded to create a regional network of interoperable, secure digital payment systems. By offering support in digital governance, cybersecurity, and financial inclusion - particularly to CLMV countries - India can position itself as a partner in ASEAN’s digital transformation. This could be complemented by targeted investments in human capital, including expanded scholarship programs, technical training, and academic collaborations, especially in healthcare, agriculture and digital skills. 

In the security domain, India should expand its naval and maritime engagement across ASEAN, replicating the model it employs with the Philippines by conducting more frequent joint exercises, coordinated patrols, and collaborative disaster-relief operations. Enhancing maritime domain awareness, fisheries management, and blue economy collaboration under the IPOI would strengthen India’s role as a constructive and non-coercive security provider. These initiatives must be backed by consistent participation in ASEAN-led forums and greater diplomatic coordination to ensure that India’s messaging and presence are timely, visible, and responsive to regional priorities.

Finally, institutional reform within India’s own ASEAN strategy is essential. Establishing a coordinated ASEAN policy unit within the Ministry of External Affairs, expanding sector-specific diplomatic missions, and creating an ASEAN–India Strategic Review mechanism would improve coherence, accountability, and agility in India’s regional engagement.

In essence, the success of the AEP will depend not on rhetoric or reactive diplomacy, but on India’s ability to align its normative strengths with credible delivery. While China maintains a prominent presence in the region, India’s approach - emphasizing partnership, transparency, and shared prosperity - offers ASEAN countries a complementary model that respects their strategic autonomy. The central question posed in this brief remains: can India transform its AEP from a vision into a multi-dimensional, actionable strategy that strengthens its role in ASEAN while promoting balanced regional development? The answer lies in India’s ability to invest strategically, act consistently, and implement initiatives across trade, connectivity, security, climate, digital economy, and cultural domains, thereby enhancing its regional relevance.