Indian Prime Minister Manmohan Singh says China is trying to expand its influence in South Asia, noting what he called a "new assertiveness among the Chinese."
Mr. Singh told the editors of the Times of India newspaper that China was seeking a "foothold" in the region and that Beijing may seek to exploit tension between India and Pakistan.
But the Indian leader also said he believed the world is big enough for India and China to "cooperate and compete."
A spokeswoman for China's foreign ministry, Jiang Yu, told reporters Tuesday that peaceful coexistence serves the common interests of both countries.
India and China, two of the world's foremost emerging economic powers, have a history of disagreements, including unresolved border disputes.
Kashmir is another source of tension between the two countries. India and Pakistan both claim full ownership of the disputed territory, which is also claimed in part by China.
India has objected to China's practice of requiring residents of Indian Kashmir to obtain special visas to enter China because it is seen as contesting India's claim over the territory.
India is also concerned with China's growing influence in the Indian Ocean region. Last week, Indian Foreign Minister S.M. Krishna said China has been showing "more than the normal interest" in countries in the area, such as Sri Lanka and Burma.
His comments came after two Chinese warships docked in Burma's former capital, Rangoon.
Meantime, China has long objected to India granting asylum to the Tibetan spiritual leader the Dalai Lama, who fled Tibet following a failed uprising against Chinese rule in 1959.
Some information for this report was provided by TimesofIndia, Reuters, AFP