When reviewing the differences between realism and idealism, the following concepts give clarity: Overall, idealism

and realism can be understood as two different perspectives. Some of the key differences between them include: 1. Idealism causes you to see things in a very hopeful manner, shaping situations with your own ideas. Realism, on the other hand, causes one to assess a situation as it is, without overt emotional involvement. 2. Idealists tend to be more positive when compared to realists, in how they perceive things and carry out tasks. 3. When making decisions, realists are more goals oriented and thorough than idealists, who may have lofty ambitions, but lack the clarity and focus to put them into action in an achievable way. Idealism holds that a state should make its internal political philosophy the goal of its foreign policy. For example, an idealist might believe that ending poverty at home should be coupled with tackling poverty abroad. Wilson's idealism was a precursor to liberal international relations theory, which would arise amongst the "institution-builders" after World War II. It particularly emphasized the ideal of American exceptionalism. Realism or political realism prioritizes national interest and security over ideology, moral concerns and social reconstructions. This term is often synonymous with power politics. As reviewed in: http://en.wikipedia.org/wiki/Realism_(international_relations) Before 1945 empires destroyed themselves. Several key players refused to respond to threats which caused the system to become unstable and temporary. From 1945 on the Cold War between Russia and the United States created a bipolar system which blocked and exhausted both systems. Also in 1945 as reviewed in: http://en.wikipedia.org/wiki/Bretton_Woods_systemSetting up a system of rules, institutions, and procedures to regulate the international monetary system, the planners at Bretton Woods established the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD), which today is part of the World Bank Group. These organizations became operational in 1945 after a sufficient number of countries had ratified the agreement. The chief features of the Bretton Woods system were an obligation for each country to adopt a monetary policy that maintained the exchange rate by tying its currency to the U.S. dollar and the ability of the IMF to bridge temporary imbalances of

payments.The transition from idealism to realism has lead to many difficult hurdles for example as stated on page 9 of our text: The application of a simplified version of realism after WW2 helped to create and feed the bipolar system of the Cold War, a dangerous system that lead to many good sized wars. Discussion question 2 The leaderships of both India and China are engaged in deepening political understanding which fosters respect for each others sensitivities, she said in a written interview to Chinas official Xinhua news agency, coinciding with the 90th anniversary celebrations of the ruling communist party. Ms. Gandhi noted that, currently, India and China are engaged in building a strategic and cooperative partnership and it is significant that China has already emerged as Indias largest trading partner. The future beckons us to build what has the potential to become one of the foremost and most substantive relationships of the 21st century and one that is of lasting benefit for the people of both our countries, Ms. Gandhi wished. At the party level, I believe that we should foster greater cultural and social linkages, especially among the youth, even as we promote trade, investment at the national levels, and international cooperation on multilateral issues of importance to both countries and on which we can adopt a common approach, she said. The history of bilateral relations between China and India dates back to mid 1980s. The process of dialogue initiated by the governments of the two countries at that point of time was quite helpful in identifying the common trade interests. Efforts were initiated to make the most of their economic strengths so as to further the economic relations between India and China. In the year1984, China and India entered into a Trade Agreement, which provided them with the status of Most Favored Nation or MFN. It was in 1992 that the China and India got involved in a fullfledged bilateral trade relation. The year 1994 marked the beginning of a new era in the China-India economic relations. In this year a Double Taxation Avoidance Agreement was signed between India and China. The governments of both the countries also took the necessary initiative to turn into dialogue partners in the Association of Southeast Asian Nations (ASEAN). Also as viewed on the website: http://www.economywatch.com/internationaleconomic-relations/ch/ Both India and China hold more or less same positions in the global economic scenario. This in turn has further enhanced the economic relations between the two countries. In 2003, Bangkok Agreement was signed between the two countries. Under this agreement both China and India offered some trade preferences to each other. India provided concessions on 188 products exported from China. On the

other hand, China provided preferences on tariff for 217 products exported from India. The economic relations between the two nations is expected to improve aided by the flourishing IT and ITES sector, biotechnology industry, health sector, and financial sector. The bilateral trade between the two countries is expected to reach 20 billion US dollars by the year 2008. The projected figure for 2010 is 30 billion US dollars. In 2003, China and India entered into an agreement to initiate open border trade via the Silk Route. The two countries have also shown interest to take part in a multilateral trade system as per the WTO commitments. Around 90 Indian companies have set up braches in China. These companies mostly operate in the pharmaceutical sector, IT and ITES sector, and automotive industry. Some of these companies are Satyam, Wipro, TCS, Ranbaxy, and many more. China has already been the top trading partner of India in the recent time. The economic relation between the two countries is considered to be one of the most significant bilateral relations in the contemporary global economic scenario and this trend is expected to continue in the years to come.