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Like other major powers, India is concerned about China's challenge to the free access to the waters of the South China Sea. The South China Sea passage is too vital for trade and international security to be controlled by a single country.

Meanwhile, China has been doing its best to roil the waters in the South China Sea. Concerns have been rising about China's claim to the ownership to much of the South China Sea waters and the Chinese Navy's assertive behavior in the region. China has decided to establish a military garrison on Woody Island in the Paracels in a latest attempt to assert claims over the region. China's Defense Ministry has openly warned that 'combat ready' Chinese naval and air patrols are ready to 'protect our maritime rights and interests' in the South China Sea.

In a bold display of power and with the help of its friend Cambodia, China prevented ASEAN from even issuing a joint statement for the first time in the organization's 45-year history. China succeeded in playing divide-and-rule politics, thereby ensuring that the dispute remains a bilateral matter between Beijing and individual rival claimants.

When China suggests that it would like to extend its territorial waters – which usually extend 12 nautical miles from shore – to include the entire exclusive economic zone, extending 200 nautical miles, it is challenging the fundamental principle of free navigation. All maritime powers, including India, have a national interest in freedom of navigation, open access to Asia's maritime commons and respect for international law in the South China Sea. China has collided with Japan, South Korea, Vietnam and Philippines in recent months over issues related to the exploitation of East China Sea and South China Sea for mineral resources and oil.

India's interest in access to Vietnam's energy resources puts it in direct conflict with China's claims over the territory. In an ultimate analysis, this issue is not merely about commerce and energy. It is about strategic rivalry between two rising powers in the Asian landscape. If China can expand its presence in the Indian Ocean region, as New Delhi anticipates, India can also do the same in South China Sea waters. As China's power grows, it will test India's resolve for maintaining a substantive presence in the South China Sea.

India has so far been a passive observer amidst growing maritime tensions and territorial claims in the region. But now after expanding its footprints in the South China Sea, New Delhi must come to terms with China's regional prowess. The challenge for New Delhi is to match strategic ambition realistically with appropriate resources and capabilities.