China has reoriented its foreign policy strategy since Xi Jinping became president. This could significantly recast China’s relations with Asian countries. The process that began with Xi Jinping’s coming to power in 2012–2013 reached, in a sense, a definitive moment, with the Central Conference on Work Relating to Foreign Affairs held in Beijing in November 2014.

In the last decade, the dynamics of inter-state relations in the Asia Pacific have changed rapidly, largely due to the rise of China. Competition rather than cooperation has become the order of the day. In the East and South China Seas, freedom of navigation, competitive claims over maritime boundaries and air space security are experiencing an evolution of new brinkmanship between the US, an established super power, and the People’s Republic of China (PRC), an emerging super power, unfolding new challenges for the other potential regional players including India.

The article argues that India does not have a well-defined neighbourhood policy. It makes a historical survey of the approaches of different Indian leaders to the neighbourhood and examines the reasons for the prevailing negative perceptions about India in the region. It argues that these negative perceptions have come about because India has largely adopted an ad hoc and bilateral approach vis-à-vis its neighbours and has allowed its policy to be guided by an overarching concern for security. In recent years, India's approach has changed considerably.