India and China are sparring over the opening of consulates in Lhasa in exchange for Chennai, in what amounts to a second round of diplomatic confrontation between Asia's largest powers, in the wake of their recent disagreement over an oil block in the South China Sea that is controlled by India, owned by Vietnam and counter-claimed by China.
The spat over the consulates is still playing out within the confines of the Chinese foreign office and the ministry of external affairs in Delhi, which seems surprisingly determined to play tough, but cool, with Beijing.
According to diplomatic sources, China is particularly cut up about the fact that Delhi has agreed to let the Republic of Taiwan, which it considers to be an integral but breakaway part of the People's Republic, to open a consulate in Chennai. In fact, Delhi has in principle also given South Korea the go-ahead to open a consulate in Chennai.
In exchange for Chennai, India is asking Beijing to allow it to reopen its consulate in Lhasa, the capital of Tibet. The Chinese have refused so far, keenly aware that even considering it would constitute a hugely powerful, albeit symbolic, victory for India.
This is because the Indian consulate in Lhasa was forced to shut down in 1959 when the Dalai Lama fled the Tibetan capital for India, where he has lived ever since as the world's most high-profile refugee. India's last consul-general in Lhasa, P N Menon, father of National Security Adviser Shivshanker Menon, knew the Dalai Lama well.
With the Dalai Lama's flight to India, the relationship between the two countries deteriorated rapidly, leading to the terrible border conflict in 1962. It would take more than a decade for both to establish diplomatic contact again, which they only did in the mid-70s.
With Beijing refusing to open the conversation about Lhasa, Delhi seems determined not to give in to Chennai. "This is what is causing the severe heartburn," the diplomatic sources said.
The story about the consulates is as old as about seven years ago when both countries sought to expand their presence in each other's countries by opening second consulates beyond their respective capitals. The opening of consulates has always been considered a significant measure of that country's importance and recognition of deepening ties.
Around 2005-6, Delhi asked for Lhasa and Beijing asked for Kolkata, but Beijing put its foot down on Lhasa. Instead, it suggested that Delhi take Guangzhou, a town on the eastern seaboard that is also a thriving business centre. India had no option but to accept, and was persuaded to offer Kolkata to the Chinese.
But Lhasa remained on India's horizon, a much-desired object, but just beyond its reach. In the intervening years, the Sino-Indian relationship stabilised, with trade now touching $60 billion, although the deficit in India's direction amounts to about $40 billion.
This ballooning deficit is another cause for distaste, especially as India is beginning to feel that China doesn't play by the rules of fair trade and keeps out Indian competition in the pharmaceutical and IT sectors.
Only a few weeks ago, India renewed its expression of interest in a consulate in Lhasa, when India's Ambassador to China S Jaishanker extensively toured the Tibet Autonomous Region on the Chinese government's invitation.
Jaishanker was taken across the province, from Lhasa to Xigaze to the Kailash Mansarovar site, to first-hand monitor conditions under which Indian pilgrims travel, both on government-sponsored tours as well as privately organised trips. The Chinese reiterated to the Indian ambassador that they would upgrade resting places which Hindu pilgrims believe are old temples and upgrade roads and infrastructure. They indicated they would relax visas and welcome even more Indian pilgrims, at 14,000 last year.
Officials admitted that Jaishanker's visit constitutes the "most in-depth exposure" to Tibet since the visit in 2002 by India's then ambassador to China, Shivshanker Menon. They argued that the deepening of the people-to-people relationship was directly proportional to the access to care and consultation Indian citizens received from Indian authorities while in China.
Interestingly, Menon's visit in 2002 came just before then prime minister Atal Behari Vajpayee's visit to China in 2003, when he agreed to the institution of the Special Representatives between the two countries to fast-track a solution to the border problem, as well as settle the Line of Actual Control.
The first SR on the Indian side was Brajesh Mishra, Vajpayee's national security advisor, followed by Menon, when the government changed in 2004. On the Chinese side, it has remained Dai Bingguo, the influential head of the Chinese Communist Party's international department.
But Comrade Dai is set to retire, by March 2013, and his job is expected to be filled by Wang Yi, a fluent English speaker and rising star in the Chinese pantheon.
India knows Wang Yi well. He was the point person for India during the nuclear tests in 1998 and beautifully articulated the bitter, yawning chasm in the relationship. If he succeeds Dai Bingguo, he will now be responsible for bridging that chasm.
