India and Japan have had a long relationship, which was never really a factor in their relationship with China.

Till 2008, Chinese intrusions into the Senkaku (Diayou) islands were rare, though Beijing had expressed their claim for the islands in the 1990s.

However, from 2010 onwards their intrusions became a routine event with 10-15 vessels entering the territorial sea every month. In early August this year, the Japanese detected an unusually large number of ships coming in, comprising of coast guard and fishing vessels. Most of these fishing vessels are manned by paramilitary personnel. Japanese analysis of the coast guard ships indicate that some of them are converted naval vessels and some even equipped with higher calibre guns.

A look at the map will tell you why the Senkakus are deemed important by China. They lie close to Taiwan and a couple of other Japanese islands which are astride China’s sea lanes to the Pacific Ocean. The Chinese view the ‘first island chain’ running from Japan to the Philippines, with Taiwan in between, as a psychological barrier to their aspiration to be a Pacific Ocean power like the US.

Japanese economists are almost uniform in their assessment that China’s economy has steadily worsened since the beginning of 2014. They think that China’s resource consumption economic model is now at a turning point. An index prepared by the Centre for International Public Policy Studies (CIPPS) based on data from some 60 Japanese companies operating in China suggests that there is substantial financial distress in production and sales. There have been significant capital flows out of China, which began with the stock market fiasco in June 2015 and there is a serious issue of new investment coming in now.

Most specialists are agreed that there is considerable problem in getting accurate information in China. There are no good indices to depend on so, it is difficult to make accurate prognoses of the economic goals of the Chinese leadership.

Looking at the internal dynamics of China, a majority of Japanese scholars believe that there remain serious internal differences and Xi Jinping’s position is not as strong as it is often made out. As one Japanse scholar put it, “Xi is much stronger than Hu and Jiang, but he lacks the charisma of a Mao or Deng. He is, at the end of the day, a princeling and a party apparatchik.” In line with this, he believes that Xi is not seeking to strengthen himself, but to shore up the institutional base of the Communist Party of China itself.

It is much more difficult to get an understanding as to where the opposition to Xi comes from. Some specialists say that it lies within the special interest groups like the PLA and the giant state-owned enterprises. Others argue that it lies in the middle-levels of the CPC itself.

In some ways, Xi and the CPC are playing a losing game as the party becomes weaker and weaker. A lot of this manifests itself in foreign policy where the CPC is using aggrieved nationalism to rally the people, a situation which triggers a vicious circle, with people then expecting China to behave as a big power whenever it confronts a crisis. As such, as one Japanese expert noted, the top two officials — State Councillor Yang Jiechi and Foreign Minister Wang Yi are not even members of the politburo, leave alone its standing committee. So, in a sense there is vacuum at the top of foreign policy decision-making.

Despite the tensions, which are very serious, Japan and China still have a significant relationship. Japanese aid and grants totalling a massive $300 billion between 1980-2014 helped China build its world-class infrastructure. Even now, the annual flow of people between the two countries is some 8 million. China is the largest trading partner for Japan, and Japan is the second largest for China and remains the third largest foreign investor in China.

India and Japan have had a long relationship, which was never really a factor in their relationship with China. As open societies, India and Japan function in ways that are quite transparent. This is not the case with China, which is quite opaque. In recent years, the rise of Chinese power has given us some understanding of the common challenges we face —such as the Chinese tendency to shift goalposts in their border claims or the mendacity of their foreign policy. Understanding Chinese behaviour and their motivation is important, because it has huge implications for both of us.

This commentary originally appeared in Mid Day.