China, the world’s largest developing country, is now on course (within the next decade) to emerge as the world’s biggest economy. As has occurred in most developed nations, this development drive has had, and continues to have, significant adverse impacts on China’s environment. This is evident especially in the diminishing quantity and quality of available water resources, both within China and crossing its national borders. In the international transboundary context this has resulted in water-related problems, in the past with Russia (industrial pollution on the Amur) and currently with India on the Brahmaputra, where China seeks to construct some major dams despite India’s protestations. China’s reaction to these transboundary watercourse events has been by using international diplomacy, the so-called ‘soft path’ of cooperation, which is the bedrock of China’s foreign policy. This approach, based on ‘dialogue, consultation and peaceful negotiations’, and crafted around the notion of restricted territorial sovereignty, has been expressed both in legal scholarship and confirmed in foreign policy statements under China’s new leadership, President Xi Jinping and Premier Li Keqiang.