While the world has focused on North Korea, the globe’s two biggest emerging economies are squaring off over their shared border.

China and India’s borderlands, though geographically desolate and inhospitable, have been a hot spot for increasing military tension in recent months. The two giants are wrestling more broadly for hegemony in Asia, and given that both are equipped with nuclear weapons, the situation could escalate.

“Both sides stand to lose tremendously, economically speaking, should this boil over into an actual war,” wrote Asia analysts Shailesh Kumar and Kelsey Broderick at consulting firm Eurasia Group.

For Gareth Price, senior research fellow on the Asia program at Chatham House, the dispute reflects how China and India posits themselves within the pecking order in Asia. “China (wants) to be primary hegemonic power,” in the region, he said, but India challenges this and “wants to be treated as an equal.”

Reuters reported Tuesday that Chinese and Indians troops were involved in a tussle in the western Himalayas. Sources in New Delhi told Reuters that Chinese soldiers attempted to enter Indian territory in Ladakh, Jammu and Kashmir state.

But Chinese and Indian armed forces have been locked in a stand-off on their border further east since June of this year, on a plateau known as Donglang in Chinese and Doklam in Indian. Both countries have amassed troops in the area following a disagreement over the Chinese building a road in territory disputed between itself and Indian ally Bhutan.

The most recent standoff came just ahead of India’s 70th anniversary Tuesday since it gained independence from the British. Prime Minister Narendra Modi, in a speech marking the occasion in New Delhi, said that India was “strong enough to overcome those who try to act against our country.”

India has been uncomfortable with China’s expansion in Asia. Price spoke of “India’s vociferous objection to the Belt and Road initiative,” China’s infrastructure development program spanning across the continent and further around the globe.

In an editorial entitled “India must not flirt with disaster,” published August 8, Chinese state news platform Xinhua said that India’s involvement in the Doklam area was “an offense to China’s sovereignty.”

Ultimately for Broderick and Kumar, “The headline risk, at the moment, is greater than the actual risk of war.”

A conflict would stem the foreign investment that’s critical for India, whereas Chinese President Xi Jinping “has already consolidated enough power that he doesn’t need to beat his chest in an external conflict to further his domestic goals.”

Alyssa Ayres, senior fellow for India at the Council on Foreign Relations, said that the ongoing border dispute is a “conflict that China has created.” She added that strategically, the “Chinese military has more to lose” and should the conflict move against its favor, this would mean “a very embarrassing loss of face.”

Both China and India are juggling other foreign policy headaches, with China playing a seminal role in the North Korea nuclear stand-off and accused of aggravating its smaller neighbors over South China Sea islands; while India has been locked into a territorial dispute with Pakistan over Kashmir for many years. China and India last directly clashed over their border in 1962, with the latter country ceding some territory.

Regardless of the potential for conflict, “China’s biggest foreign policy concern is making a success of Belt and Road,” Price said. Broderick and Kumar said that China’s North Korea and South China Sea concerns take precedent because they “include multiple actors and the domestic economy.”

But they added that China’s firm grip on the situation was important, given its upcoming 19th Party Congress this autumn.

Broderick and Kumar also pointed out that Indian voters are more concerned with existential threats from Pakistan, rather than China.

Ultimately with regard to the potential for outright conflict, according to Price, “All logic says it won’t happen.”