OREANDA-NEWS. September 29, 2011. India's recent oil deals with Vietnam in South China Sea, a disputed territory, has created a "negative impact" in China and the issue needs to be handled with sensitivity in the interest of better relations between the two rising Asian powers, says Ma Jiali, an influential Chinese analyst and South Asia expert.

Rejecting India as a rival to China, Ma, the author of 'Rising India' and a key participant in China-India bilateral discussions on security issues, also struck a cautionary note on the proposed India-US-Japan trilateral dialogue, saying it appeared like it was "targeted at China partially".

The oil deals with Vietnam "has made a negative impact. This is a very sensitive issue and involves Chinese feelings," Ma, a well-known strategic expert at China's Institute for Contemporary International Relations, told IANS in an interview in this seaside Chinese resort located barely miles away from the South China Sea.

"India and China should deal with this issue with sensitivity. Otherwise, the atmosphere will be tense," said Ma.

He was responding to a question on India's decision to go ahead with exploration in two Vietnamese oil blocks in South China Sea - which is also claimed by other countries like Vietnam and Malaysia - by ONGC Videsh Ltd (OVL) eliciting a sharp response from Beijing which has asserted "indisputable sovereignty" over the whole of the oil-rich sea.

"All countries know South China Sea is disputed sea. India's oil deals in this sea has the potential to damage the relationship. I hope Indian analysts can judge which relationship will be more important in days to come," said Ma, a multi-faceted thinker who is equally adept at playing piano and football.

"If we want to resolve the boundary issue, we must maintain a positive peaceful atmosphere," stressed Ma, who was a part of Track II initiative and Eminent Persons Group that sought to build greater trust between the two rising Asian powers.

The oil deals issue, Ma indicated, could figure during talks between special representatives of India and China who are expected to meet for the 15th round of boundary talks in New Delhi in October-end or early November.

Amid widespread scepticism about the course of boundary talks, Ma insisted that the negotiations have made "some progress", and struck an optimistic note saying the issue should be "resolved finally on the basis of mutual adjustment."

India has defended the oil deals with Vietnam in South China Sea, saying they were in keeping with "international laws".

Month after an Indian warship INS Airavat, which was operating off the Vietnam coast, was warned by a "Chinese warship" that it was in Chinese waters, New Delhi has vigorously defended "the freedom of navigation in South China Sea."

Ma said Beijing is closely watching India's burgeoning relationship with Vietnam and contended that some Chinese scholars feel India wanted to develop "a strategic relationship with Vietnam to balance China."