China on Monday said it was “happy” to see the development of relations between India and Myanmar, downplaying reports published by some media outlets here that framed Prime Minister Manmohan Singh's visit to the country as a challenge to once-unrivalled Chinese influence.

“Both India and Myanmar are China's friendly neighbours,” Foreign Ministry spokesperson Liu Weimin told reporters at a daily briefing. “China is happy to see the development of friendly relations between India and Myanmar, and we hope such development of friendly relations will be conducive to the stability and prosperity of the whole region.” Mr. Liu said China “would like to maintain high-level exchanges with Myanmar”, though there were no immediate plans for a visit by Chinese Premier Wen Jiabao, who reportedly postponed a trip scheduled for late last year. “We believe the two countries will arrange their high-level exchanges based on their actual needs above the ministerial level,” Mr. Liu said. Against the backdrop of unfolding political reforms in Myanmar, Chinese analysts have expressed some concerns over relations that were close and unrivalled under Myanmar's military regime, as new forces reshape the country's political landscape. In September, Chinese officials were left stunned when the newly-inaugurated Myanmar government under President Thein Sein ordered the suspension of the $3.6 billion China-backed Myitsone dam project on account of environmental concerns. With the United States also easing some sanctions, Myanmar has been keen to diversify its diplomatic and economic engagement. An April report by the International Crisis Group said “an over-reliance on China has been of growing concern to many in the Myanmar political establishment”, particularly as the country has historically adopted multilateralism “as a way to avoid what it saw as the risk of being overwhelmed by giant neighbours.” India, however, is perceived by many Chinese analysts as being far less of a threat to China's interests in the country than the United States, whose moves to reengage with Myanmar have stirred much debate in the State media.

Ye Hailin, a South Asia scholar with the influential Chinese Academy of Social Sciences (CASS), pointed out in an interview with the Global Times this week that India's engagement with Myanmar in terms of trade and investments still trailed that of China and other countries.

“With Myanmar's new openness to the West, dominated by the U.S., and China's ongoing influence in the nation, India has actually been edged out of the main stage while both the U.S. and China are doing whatever they can to gain the favour of economically struggling, strategically-placed Myanmar,” Ms. Ye said. “This is not a situation that India wants to see.” Last year, China led foreign investments in Myanmar, committing to $8.3 billion and far exceeding India's $189 million, according to data from IHS Global Insight cited by Agence France-Presse. In the year 2010-11, China was Myanmar's largest trade partner, with the $4.7 billion bilateral trade accounting for more than one-third of the country's total trade volume. India's $1.4-billion trade with Myanmar is expected to touch $2 billion by next year.

Dr. Singh's visit this week has been seen by Chinese analysts such as Ms. Ye as “an obvious sign of India picking up the pace to bolster bilateral ties”. She said India would also be “closely monitoring whether the China-Myanmar relationship will take on a military dimension in case rumours about China attempting to build naval and intelligence facilities in Myanmar turn into reality. It is in India's interest to encourage Myanmar to take the current political reforms to their logical conclusion for free and fair elections in 2015, but whether it is in Myanmar's interest to take India as a main ally still needs consideration”.

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