THE recently concluded visit by Hu Jintao to the United States is significant for South Asia. The main purpose of the visit by the Chinese president was to reset relations between the two global powers with the aim of producing a more stable global order.

The American tone at the formal meetings in Washington was very different from the one used by President Barack Obama during his visit to Beijing in November 2009. Then he welcomed China to a shared position with the United States in the emerging world order, a kind of 'G2'. Now the American president talked about “cooperation and competition” between the dominant powers.

The Hu visit came after Obama's trip to India in which he promised a larger role in world affairs to the other rising Asian power. Washington seemed to be moving away from a G2 world to a multi-polar world.

President Obama's state visit to China in Nov 2009 was meant to introduce a new economic and political order in which most of the direction would be provided by Washington and Beijing working together within a new framework that was dubbed the G2. China seemed less willing to play the role that was being assigned to it by the new leadership in the United States. Neither side made much progress after the Obama visit. There were few breakthroughs in the relationship.

The Americans wanted the Chinese to adopt a tougher stance towards North Korea whose revealed work on uranium enrichment had caused an enormous amount of worry in the US. In economic matters there was the perennial American concern about an undervalued Chinese currency that gave the country tremendous advantage in international trade.

The Chinese were less welcoming of American investment and less open to allowing US companies to bid for government contracts than Washington had hoped. The Americans also continued to worry about the lax Chinese attitude towards the protection of intellectual property. Washington was also concerned about the aggressive posture adopted by the Chinese military. There were also the usual concerns about human rights in China.

On the Chinese side the list of worries was equally long. It included Washington's failure to bring under control its large fiscal deficit which, Beijing believed, was the main cause of the trade imbalance between the two countries. The sale of American arms to Taiwan and Washington's continued support of the Dalai Lama were even bigger thorns in the relationship.

The year 2010 ended with both sides showing wariness. As a Chinese journalist put it at the joint press conference addressed by Presidents Hu and Obama, there was “strategic mistrust” between the two countries. There was apprehension in Beijing that the US was seeking to encircle China and suppress its rise.

There was some fear in Beijing that in dealing with China Washington was using the tactics it had employed against the Soviet Union during the peak of the Cold War. Then, the US had established a series of formal alliances involving the countries around the periphery of the USSR. This time around Washington seemed to be concentrating its attention on India.

President George W. Bush had initially adopted that approach. President Obama was reluctant to follow the course set by his predecessor but seemed to have changed his mind midway through his first term. He went to India exactly a year after his visit to China and indicated that America's relations with India would shape the 21st century. In Mumbai and New Delhi the American president repeatedly declared that India was no longer rising, it had already risen.

These messages were not lost on Beijing, which launched its own effort to cultivate its large Asian neighbours. In Dec 2010, a month after President Obama's visit to India, Chinese Prime Minister Wen Jiabao went to India and Pakistan to remind the two of what China's increasing economic might could do for them.

The prime minister announced large investment programmes in several sectors of the two South Asian economies. The message was clear: unlike the US that faced many economic and financial difficulties, China had the resources to develop South Asia.

From South Asia's perspective the most important outcome of the summit was the signal that went out to India that President Obama was prepared to correct the course he had set earlier. Upon taking office, the first impulse on the part of the new administration was to allow greater economic and political space to Beijing. This message was read by the Chinese as recognition by Washington that it was a declining power. It was also seen as a weakness on Washington's part in its dealings with Beijing. President Obama's statements during his first official visit to Asia in 2009 may have contributed to greater assertiveness on China's part in international affairs. The Obama administration was persuaded that it had moved in the wrong direction and a course correction was needed.

In Nov 2010, especially during his stay in India, the American president changed the signal his administration was giving by recognising the global importance of rising India. He and his advisers seem to have concluded that in the new international economic and political order, greater space had to be allowed to other rising countries such as India than was the case in the G2 configuration earlier espoused.

It was clear that China read the new message. During his stay in the US Hu Jintao displayed much greater humility in his pronouncements than he had done during President Obama's 2009 visit to Beijing. He also recognised that China had a way to go before it reaches the pinnacle of global power.

The writer is chairman of the Lahore-based Institute of Public Policy, a former finance minister of Pakistan and former vice president of the World Bank.