China’s growing presence in South Asia is riding on its accelerated economic and strategic influence in the region. This article gauges the interplay between economic, particularly resource factors, and strategic factors in China’s advance in the region and its relations with South Asian nations. One measure of China’s economic outreach is its current trade volume with all South Asian nations, which now approaches $20 billion a year.  Its bilateral trade with India alone accounts for $13.6 billion a year, a number that Prime Minister Wen Jiabao has projected to grow to $30 billion by 2010.  Yet it constitutes just 1% of China’s global trade as compared to 9% of India’s.  These statistics pale in comparison with the trade between China and East Asian nations. China’s trade with Japan, which was valued at $213 billion in 2004,  is more than 15 times that between Beijing and Delhi. In 2004 China passed the United States as Japan’s largest trading partner. What is remarkable about Sino-Indian trade, however, is its dramatic acceleration from $338 million in 1992 to $13.6 billion in 2004.  The projected $30 billion trade between China and India by 2010 will likely surpass Indo-U.S. trade that is currently valued at $20 billion a year.