NEW DELHI, India — The deal George W. Bush offered the world at the beginning of the Iraq war sounded tough. But the choice Beijing has offered New Delhi is even tougher: You're either against us or ... you're against us.

Beijing called off talks with Delhi this week that were meant to address their long-running border dispute. The decision followed a spat over the Dalai Lama's planned speaking engagement at a meeting of Buddhist leaders in the Indian capital.

Despite US President Barack Obama's emphatic statements about America retaining preeminence in Asia — most recently in the form of an address at a gathering in Indonesia of the Association of Southeast Asian Nations (ASEAN) — New Delhi has held out hope that it can remain non-aligned amid China and the US' struggle for dominance.

But, according to analysts, Beijing's decision to pull out of talks with Delhi may wind up pushing India closer to Washington after all, ratcheting up tensions between Asia's largest military powers.

“The soap opera [of India-China relations] just got a little interesting,” said Jabin Jacob, assistant director at the New Delhi-based Institute of Chinese Studies. “It's not really a cold war, but sort of a cold peace.”

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According to Indian media, China was unhappy that the border talks were to coincide with the conclave of Buddhist leaders, where the Dalai Lama was set to deliver the valedictory address.

Beijing views the Dalai Lama as a figure intent on undermining China's power and pushing for Tibetan independence, although the Tibetan Buddhist spiritual leader has repeatedly said he wishes for autonomy for Tibetan people rather than independence.

Beijing pressured New Delhi to cancel the conference or bar the Dalai Lama from speaking. When India refused, it cancelled special representative Dai Bingguo's planned meeting with Indian national security advisor Shivshankar Menon.

According to India's former national security advisor, America's responses to China's growing economic and military might have only made Beijing more anxious about perceived attempts at containment. “Now that there is talk of Japan, US and India sitting down and talking about [how to react to China's growing power], and perhaps getting Australia, the Chinese dream of becoming No. 1 in the world [has been] shaken,” said Brajesh Mishra, who was national security advisor to India's prime minister from 1998 to 2004. As a result, he said, “the relationship between India and China becomes very strained.”

China's claim to parts of Kashmir and Arunachal Pradesh — which Beijing likes to call “South Tibet” — have fueled the long-running border dispute between the two countries. But the cancellation of the high-level diplomatic talks had as much to do with the East Asia Summit as it did with border issues or the Dalai Lama.

“Many people in China — policy makers and analysts — are indeed concerned about Indian involvement in the South China Sea,” said Li Mingjiang, a professor at the S. Rajaratnam School of International Studies at Singapore's Nanyang Technological University.

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“Some Chinese analysts believe that ... India wants to play the South China Sea card against China in order to complicate China's strategic environment in East Asia and gain some leverage in India-China relations.”

By demanding that India muzzle the Dalai Lama, Beijing established that it aims to continue to worry and provoke New Delhi under the guise of protecting itself from meddling in its internal affairs. Beijing believes a good offense is the best defense, Indian foreign

policy experts say. And such protestations against purported wrongs keep India too busy parrying to make its own thrusts on issues like the reported massing of Chinese soldiers in Pakistan-administered Kashmir and alleged incursions across the disputed borders in Arunachal Pradesh and Ladakh.

At the same time, India's once-conciliatory Prime Minister Manmohan Singh has shown a new willingness to push back.

“The Indians finally discovered that they have a spine,” said Indiana University professor Sumit Ganguly. “Supineness before the PRC had not really paid off. The demands simply escalated.”

So far, statements from both sides have been carefully calibrated. Though New Delhi refused to interfere with the international Buddhist conference — which hosted some 800 Buddhist spiritual leaders Nov. 27 to 30 — India's president and prime minister avoided the event in deference to Chinese concerns. However, when China subsequently sought to compel the governor and chief minister of West Bengal to steer clear of a public appearance by the Dalai Lama in Kolkata on Thursday, the two officials refused to allow Beijing to dictate their itineraries. Moreover, New Delhi reportedly plans to register a protest with Beijing over its breach of protocol in writing directly to officials in West Bengal instead of going through the central government.

Similarly, even as Beijing blasted the Dalai Lama as a separatist and insisted it would not tolerate any nation providing a platform for his “anti-China” activities, a foreign ministry spokesman told a gathering of Indian reporters that work was already underway to reschedule the postponed border talks.

Yet, only a day or two later, Chinese officials wrote to the chief secretary of West Bengal saying that any official presence at the Dalai Lama's speech implied an endorsement of those self-same "anti-China" activities.

The postponement of the border talks itself may come at a cost to India-China relations, said Shrikanth Kondapalli, a professor of

Chinese studies at Jawaharlal Nehru University.

Though progress on the border dispute was unlikely, Dai's discussions with Menon were meant to lay the groundwork for a subsequent visit by Chinese Vice-President Xi Jinping, whom observers expect will

succeed Hu Jintao as the general secretary of the Communist Party of China (CPC) in 2012 and as China's president in 2013.

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“Xi Jinping's visit could have been useful and crucial,” Kondapalli said. “[And] if Dai Bingguo doesn't make it over the next one month or so, it would be difficult for Xi Jinping to visit.”

Meanwhile, China and India continue to jockey for influence in multilateral regional bodies like the Association of Southeast Asian Nations (ASEAN). The two nations are edging ever closer to becoming direct economic competitors.

Mutual distrust has mounted as both sides shore up their defenses. Each interprets the other's manuevers as an offensive threat. In recent months, India has declared it will raise 100,000 troops for stationing along its border with China, including a regiment equipped with cruise missiles.

“All this has led to a very uneasy situation between the two countries,” said Mishra, former national security advisor.

And there's no sign yet of an early thaw.