It all started when India sought an external loan from the Asian Development Bank (ADB) for development projects in Arunachal Pradesh. That was when China moved forward to put a blockade, saying that the area in concern was a “disputed territory” and as such, ADB’s granting the loan would mean that they acknowledge the part to be in India.
As expected, India vehemently opposed China’s contradiction as India always has always believed in Arunachal Pradesh as being an integral part of the Nation. India needed the $60 million for a watershed development project in Arunachal Pradesh. US, Canada and some of the Western donors did come to support India’s cause, but China said that it’d support the grant only if ADB clearly mentions that the loan did not confirm Arunachal as part of India.
Now, it seems India has bactracked on its earlier position of opposing China, and taken a much easier route. Our external affairs minister SM Krishna has said that India is now looking to get the money from internal sources, as external loans can be “unstable”. One wonders that if really external loans are unstable, why did India require it at the first instance? Is it that India is afraid of confronting China on a border issue, when it is already fighting with Pakistan on a similar issue from past few decades?