In his book "On China", Henry Kissinger claims that Mao never intended to truly take control of the territory. China may or may not have been able to hold the area over the long run and may or may not have been able to win an extended war with India. China's success in the war is partly a product of the lightning speed of the whole thing. The conflict only lasted a few weeks. Had the Chinese dug in and prepared for an Indian counter-attack, would they have been able to hold the ground? Who knows, but in the early sixties China was not really in a position to seek out large scale military endeavors. Even in the case of victory, long term war would have had a cost for China.

Kissinger's interpretation, at least partly derived from the conversations he had with high level Chinese officials, including Mao, was that the lightning fast war was a show of strength and will aimed at India. In the run up to the conflict, there were actually numerous incidents in the contested areas. The Chinese functionally pushed the Indians out of the area and the Indians were cautious to come back even when Chinese forces withdrew. It's worth noting that much of the contested area is functionally uninhabitable, yet China maintains de facto control over Aksai Chin.