Concern mounted in India in 2007 when Chinese President Hu Jintao rounded off his eight-nation trip to Africa with a stop at Seychelles. Last year, they reached a crescendo with the berthing of Chinese submarines in Colombo, and the visits of President Xi Jinping to Sri Lanka and Maldives, as part of his South Asian tour that brought him to India.

China is using economic, military and diplomatic tools to gain influence over coastal states and small islands in the IOR and is using its investments and aid to consolidate its strategic positions. In addition, there is the reality of China’s steadily growing influence in the littoral through military and economic ties with our immediate neighbours, Myanmar, Bangladesh, Sri Lanka and Pakistan.

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Just how intense the competition is, became evident last month when Male’s main water desalination plant collapsed. Just a day after India sent five aircraft and two ships on an emergency mission to aid Maldives to overcome its water crisis, China pointedly sent a military vessel carrying 960 ton of fresh water and donated $500,000 for the repairs of the plant. Maldives is a particular area of concern to India since it was the object of back to back visits by Chinese President Xi Jinping in September and Defence Minister Chang Wanquan in November 2014. There have been persistent reports about China’s desire to construct a naval facility in the archipelago.

Chinese trade in the IOR has steadily grown in recent years. Beijing has important ties with resource-rich nations of East Africa and the Persian Gulf. It has a major role in the Gwadar port in Pakistan, at the mouth of the strategic Persian Gulf. Last November, China gave a call for the creation of a maritime silk route to enhance connectivity and trade among the Asian nations, and it has now operationalised a $40 billion fund to assist in the building of port and infrastructure in relation to it.

India can hardly object to the growth of Chinese trade and commerce in the IOR and its efforts to enhance connectivity. Indeed, it is not difficult to see why regional countries welcome Chinese interest and investment. But this has been accompanied by a significant stepping up of military activity as well. Last year, the PLA Navy carried out a special exercise on breaching the Lombok Strait that leads into the IOR from the Java Sea. It also sent a nuclear propelled submarine on a patrol across the Indian Ocean, ostensibly on an anti-piracy mission. Indeed, China’s robust participation in the anti-piracy task force off Somalia have given it a great opportunity to maintain a presence in IOR and familiarise itself with the region. But what has gotten New Delhi’s goat were the visits made by two Chinese conventional submarines to Colombo harbour. One of them, was clearly timed to coincide with the visit on September 7, 2014, of Japanese Prime Minister Shinzo Abe, an important Indian ally, to Sri Lanka.

Geography and culture favour India in the IOR. The Indian peninsula juts out into the ocean and gives us unparalleled location astride important sea lanes. The Indian diaspora is scattered across the region from South Africa to Myanmar and the Persian Gulf. The Andaman & Nicobar Islands sit at the head of the Malacca Straits through which 30 per cent of the world trade passes which includes 50 per cent of oil being shipped. For this reason, China has been exploring the alternate routes via Lombok and Sunda Straits, as well as developing over-land pipelines to connect via Kyaukphyu (Sittwe) in Myanmar and Gwadar in Pakistan. There is an even grandiose talk of cutting a canal across the Isthmus of Kra.

The Indian Navy’s Maritime Doctrine describes its “primary areas of interest” to include our territorial waters and the exclusive economic zone out to 200 nautical miles, the Arabian Sea, Bay of Bengal and their “littoral reaches”, the choke points at Malacca, Sunda, Lombok, Hormuz, Bab el Mandeb, and the Cape of Good Hope. The southern IOR, Red Sea and its littoral, South China Sea and the West Pacific are areas of secondary interest.

The long-term goal of the IN is to exercise sea control and have the ability of power projects ashore in its region of primary interest. But India’s present challenge is to step up its game to maintain its presence in the region in the face of stiff Chinese competition. It has developed relations through naval diplomacy, which includes the transfer of patrol craft and reconnaissance aircraft and helicopters. Now it needs to consolidate these through enhanced trade and investment aimed at integrating the region into India's economic sphere.

New Delhi cannot match Beijing in terms of resources, but what it does have is location, a great deal of goodwill and also friendly allies, especially the IOR’s hegemon-the US. Even so, India needs to up the ante by finding money to put into strategic investments and projects across the IOR-whether it is Myanmar, Iran, Sri Lanka or Mauritius. The way to do it is not governmental schemes which are all running late, but to draw strength from India’s entrepreneurial class and the private sector.

The writer is a Distinguished Fellow, Observer Research Foundation, New Delhi