NEW DELHI: Any kind of containment by the United States and China of the "other" would be a painful exercise for both countries, Foreign Secretary Shyam Saran said here on Monday.

Inaugurating a background programme for diplomatic correspondents at the Indian Council of World Affairs (ICWA), Mr. Saran said he did not see any "major confrontation" between the nations on the horizon.

He joined issue with analysts who felt that a conflict between the U.S. and China was inevitable.

Rejecting the notion that India was part of any design to contain China, he pointed out that trade with Beijing stood at over $18 billion and that China was likely to become India's largest trading partner by 2010, if the present trends continued.

Economic relationship

Pointing to the huge gap in Indo-U.S. trade ($25 billion) and China-U.S. trade ($250 billion), he said China today was financing the American deficit with its purchase of U.S. Treasury securities.

Unlike the Cold War period when engagement between the U.S. and the then Union of Soviet Socialist Republics was limited, he said both the U.S. and China had huge stakes in continuing their economic relationship.

On energy security, he conceded that the continued reliance on fossil fuels would mean a "scramble" between India and China for the limited oil and gas reserves.

However, to "avoid too much competition," the countries were cooperating with each other, as demonstrated in Sudan and Syria. Many other such ventures were in the pipeline.

Presenting a broad review of India's relationships, he said New Delhi did not favour the creation of a separate state in Sri Lanka. In response to questions, he said, "We have not accepted that the LTTE is the sole champion of Tamil interests."

"Big stakes" in Sri Lanka

Maintaining that India had very "big stakes" in Sri Lanka, he said India had not joined the "co-chairs' process" because its "sensitive relationship" with Colombo "does not lend itself to group responses as envisaged by the co-chairs."

He said war was not a solution to the ethnic problem there. According to him, India could not afford a "hands-off" attitude towards Sri Lanka as New Delhi had too much at stake.

Mr. Saran, who favoured closer economic and transport links in South Asia, told the correspondents that the Indo-Sri Lanka free trade agreement was a model for other nations.

He said the Government was unable to make a sober assessment of the hijacking of flight IC-814 in December 1999 on account of the tremendous pressure applied by the media, which repeatedly highlighted the concerns of family members.

On terrorism

The international community could not take a segmented view of terrorism. An approach that put the Al-Qaeda and the Taliban at the top of the list would not prove successful. On India-Pakistan relations, he said India believed in a cooperative vision of South Asia.

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