Even some of our religious practices are similar: I was surprised to see in a Chinese temple they do similar things as in Hindu temple like burning incense sticks, lighting a lamp etc.  There is this one place in Singapore where a Hindu & Chinese temple are right next to each other in the same compound.  It was extremely interesting to sit there and watch people follow similar rituals in  both places.

A lot of this also has to do with demographics...bulk of the Chinese population (higher than 60%) is less than 25 years old...there is only one other big country that has more favorable demographics...India!

 
Right after World War two, there were a couple of other countries that preceded China/India in economic development...one was Japan, the other South Korea...it was again favorable demographics (in those years) and determination to lift themselves, that made them get to be successful.

 
We were discussing about Taiwan & Tibet (around the dalai lamas planned visit to taiwan and the controvery surrounding it) and I asked him what was the main religion practiced in China. He said personally he does not follow any religion but Chinese are basically Buddhist. And that buddhism originally came to china and then from there spread on to korea, japan, etc... Then why are the chinese and tibetans not syncing up. I am aware of buddhism spreading to Sri Lanka during the rule of Emperor Ashoka and then onwards to south east asia.I need to understand the history of buddhism and then probably would understand this better.

And the other day I was watching a program on Cambodia and they were talking about hindu temples for Lord Shiva / Vishnu over there from ancient times. So probably historically Indians have influenced / ruled most of the asian region - as you also have obeserved from the chinese practices. Like the Chola dynasty ruled upto Indonesia owing to a strong Naval force.

 I think Chinese despise us, probably because we appear to be very insulated and are definitely very arrogant with our smaller neighbours (like Burma, Nepal etc).

I believe this arrogance comes out of the complex of being ruled by outsiders for 1000 years. I also believe that the people who were instrumental in carving out Pakistan from us were aware of this complex in an average Indian's psyche and hence wanted to get away from it and retain their superior status of rulers prior to British. So they found a natural ally in China.
 
But have no doubt, China is competitor number one. And we must compete on our own might and definitely not piggy back on US of A.

Taoism is the most ancient way of life of Chinese. It predates Buddhism. Since Taoism is so pure, they never made any religion out of it and the Taoist masters did not have any difficulty accepting Buddhist teachings because their only concern was truth. And Buddha did not preach any falsity. There had never been any temple of Taoism.
 
Lao Tzu is generally considered to be the first master of Taoism. But, Just as Krishna says in Bhagavad Gita that what he says had been said earlier, Lao Tzu too spoke of what had been existing all along.
 

Globalization is the key word. Each of the big economies will form natural allies, in recent analysis, in the next 10 - 15 years China will take over as the biggest economy in the world pushing US to second. India will take the third spot and surpass US  around 2050.