Neutering & Defanging Chinese Threat (15-11-2017)

[Sonugn]

Wow! Closing a consulate on such short notice is pretty big.

Fireworks in the SCS soon? My warmongering self can't wait. lol

It is being rumored that they were providing infra/financial/other support for the riots. (blm/antifa)

[Gyan]

There were some videos allegedly of Chinese speaking Mandarin completely covered with Soft body armour, participating in Riots

[Gyan]

Chinese RMCQ cranes for the Chahbahar port haven't arrived 3 years after the GOI ordered them,hampering operations at the port,further ruining our relations with Iran.Why has the GOI repeatedly ordered PRC goods well-knowing it is India's foremost enemy even after Doklam? The order for these cranes was placed at the "height of the Doklam crisis !" Are there vested interests in babudom benfitting from an appeasement of the PRC? We are in shit st. as there are no alternative crane makers willing to supply in the face of US sanctions agsinst Iran.This is forcing India to keep the order alive..

China is infamous for bidding low & bribing very very big. That's why its influence in the world has increased exponentially. Noone wants to address the issue of Chinese Bribes & how it they have become so big that they are distorting Geopolitics now

I suspect Chinese Bribes have bought so many world leaders that noone wants to take any action against China

[darshan]

Bribes and chinese dolls to trap. Many businesses moving to China in early days were stung by these dolls to put them in can't tell or disclose mode. What happened in China stayed in China.

[isubodh]

China is infamous for bidding low & bribing very very big. That's why its influence in the world has increased exponentially.

Isn't that explanation little too simplistic, if they can have bribe money + cheap tendering + delivering most of the time. Then either others are charging too much or don't know how to run business.

How long can a country underbid + pay bribes and still build a surplus of 3 trillion.

[g.sarkar]

Bribes and chinese dolls to trap. Many businesses moving to China in early days were stung by these dolls to put them in can't tell or disclose mode. What happened in China stayed in China.

Darshanji, forget about the chinese dolls. Even their jawans look chikna and namkeen.
Tauba Tauba, bad thoughts, Allah rahmat farmaye.
Gautam

[Gyan]

China is not a market economy. Command Economy can use its Resources & Slave labour to produce goods very efficiently which can be exported below cost. Remember Cheap goods from Soviet Union, with Natashas to pinko party. Hence win win. Award L1 and take bribes, sex massage & scotch. (I mean rest of the world, not India). Economy may collapse eventually but till its ticking, it generates lot of Mullah.

[ricky_v]

https://www.wionews.com/world/chinas-flood-crisis-deepens-as-several-dams-may-collapse-315235

China's Guang-Xi region's dam has collapsed. It was built in 1965 and could hold more than 195 thousand cubic meters of water which is good enough to fill 78 Olympic size swimming pools.

However, the dam has now collapsed because it could not handle the floodwaters even as voices from the ground confirmed the impending crisis. When the dam collapsed, the local media didn’t report it. More dams and structures in China may collapse.

Here is the livestream of the three gorges dam btw

[Manish_Sharma]

This is American angle, you can't fight China, buy loads of our Weaponry & allow us a Naval base on land:

https://nationalinterest.org/feature/4- ... ina-165053

4 Reasons Why India Couldn't Win a War With China

July 17, 2020

by Amit Gupta

The clash between India and China on June 15 left twenty Indians and an unknown number of Chinese soldiers dead. This led to a wave of public outrage in India. Retired Indian generals came on television to demand that India take the fight to China (with claims that the military is supremely confident it could do the job) and the Indian public started talking about boycotting Chinese goods. Neither option is a particularly good one for India. War would be prohibitively expensive for India and unlikely to achieve the country’s strategic objectives. Instead, there are diplomatic, economic, and military choices that India can make to both achieve greater security and put pressure on China. 

Why War Doesn’t Work

Although the drumbeat for war is being beaten in India, while the Chinese are downplaying the incident, an armed conflict will do little to resolve India’s security dilemma along the Himalayan border with China. The coronavirus and the economic downturn caused by currency demonetization, when coupled with an expensive war, however, limited the latter might be, could lead to a serious downturn in an economy that is already bleeding. The problem gets compounded by the fact that unlike the aging populations of Europe, India is a young nation with a median age of twenty-seven.  Employment, therefore, becomes important for the prevention of large-scale unrest and a war that further weakens the economy would not help. 

Secondly, the Indians are right that they are well-fortified along the border and therefore it would be difficult to dislodge them from their positions. The Indians, therefore, are confident that there will not be another 1962-type war where the Chinese overran Indian positions and went fairly deep into Indian territory. China, however, is not going to fight a 1962-like war and will, instead, depend on increased mobility and better fire-power to inflict casualties on India. The fear then is that the Indians would achieve marginal gains at severe economic costs or get a bloodied nose and have little to show for it. No one in India seriously believes that the Indian military could get back the land it lost to China in the 1962 war. 

Further, the Chinese have a $14 trillion economy compared to India’s $2.9 trillion economy and could, therefore, sustain a conflict over a longer period of time. The Indian estimates on a war are based on a rosy picture where it goes on for a couple of weeks and then there is diplomatic intervention by the international community. But things may not go according to Indian calculations and there are doubts about how long India could sustain a war effort. In 2017, the Indian Comptroller and Auditor General issued a report that said that India had enough ammunition for a ten-day war and while the armed forces have certainly built up their reserves for this crisis, it is not clear how long those reserves would last in an extended conflict. To sum up, why fight an economically draining conflict to achieve what are at best-limited objectives?

Thirdly, the international community is not going to give substantial support to India and, instead, likely to adopt a neutral position in the conflict particularly since the Chinese now have created economic interdependencies around the world that are making other countries less willing to challenge China’s perceptions and actions in world affairs. Greece, for example, sold its port of Piraeus to China and in return blocked a European Union (EU) statement criticizing China’s human rights record. The rest of the EU is considering whether to allow China to build the 5G communications network on the continent and is, therefore, unlikely to offer more than lukewarm diplomatic support to New Delhi.

Similarly, despite nearly three decades of an Indian “look east” policy, the ASEAN countries are now linked in a dense economic web with China and this year ASEAN surpassed the EU as China’s major trading partner.  As a consequence, the ASEAN countries are unlikely to side with India and risk killing the Chinese economic goose that lays the golden eggs. 

Fourthly, Indian diplomats, academics, and journalists are fixating on the Quad while not understanding its limitations. In New Delhi, this author has found a puzzling enthusiasm among the policy classes for the Australia option even though the truth is far less flattering to Canberra because Australia cannot break its economic interdependence with China. Canberra’s major exports are commodities, education, tourism, agriculture, and services and four of these revenue earners depend on a continued and thriving economic relationship with the Chinese. Australia sells large amounts of copper and iron ore to China and it was this sale of minerals that sparked a boom in the Australian economy that has continued until this year. China imports $63 billion Australian dollars of iron ore, $16 billion of natural gas, and $14.6 billion of coal from Australia. Large numbers of Chinese students study at Australian universities and contribute $12 billion to the Australian education system while Chinese tourists are vital to the Australian tourist industry. Australian data reveals that the country gets 8.5 million visitors annually and 1.4 million of those are Chinese. Further, Australia makes $43.9 billion Australian dollars from tourism and $12 billion of that comes from Chinese tourists—over 25 percent of the revenues earned from tourism are from Chinese visitors. Australia now sells about $12 billion of agricultural products to China which is about a quarter of Australia’s total agricultural exports. Not surprisingly, Australians are reluctant to talk about militarily engaging China and, in actual fact, Australia can do little to China unless it is in concert with the United States of America. If India is not attractive enough to make other countries abandon Beijing or weaken their ties with it, then what can New Delhi do to address its new security dilemma?

India’s Options

India’s options lie in two areas which would require the country to make bold and revolutionary changes to its foreign policy and in its approach to the international economy and foreign investments. Economically speaking, the Indians cannot compete with the Chinese in terms of providing alternative supply chains to western manufacturers but they can provide a prize that the west would find hard to resist—and that is the award of contracts for India’s 5G network to western companies. Huawei and other Chinese firms have lobbied hard to get access to the Indian market of 1.3 billion people for, if it was coupled with 1.4 billion Chinese, it would give Beijing a formidable numerical advantage in the global race to establish a 5G network. For India, it would help send a message to China that it does have other economic alternatives and that it can piggyback off the West’s technological prowess to launch its own future economic and technological growth which will depend on the successful adaptation of 5G and artificial intelligence (AI) into different parts of the Indian economy. In fact, 5G coupled with AI would serve as the basis for transforming India into a knowledge economy.

Such an opening of the economy would also be the first step to moving towards a broader freeing up of the shackles that continue to make doing business in India remains cumbersome for most companies (India is now ranked seventy-seventh by the world bank in terms of ease of doing business while New Zealand, Singapore, Denmark, Hong Kong, and South Korea make the top five and China is ranked forty-sixth).  While making the economy more open to global investment is a first step, the real shift may have to come in a reorientation of Indian foreign policy with a hard look at the policy of nonalignment.

A New Foreign Policy?

Since achieving independence in 1947, India has followed a policy of nonalignment which was incorrectly labeled as neutrality by the West. Nonalignment proposed that the country keep its distance from both superpowers but side with one of the other based on the merits of the case that was being debated. Nonalignment was rendered impotent during the Chinese war of 1962 when Nehru asked Kennedy to provide an emergency supply of arms and ammunition to the beleaguered Indian armed forces. Later, in 1971, India signed a Peace and Friendship Treaty with the Soviet Union to alleviate Chinese and American pressure on New Delhi during the Bangladesh crisis. Few, therefore, took India’s nonaligned credentials seriously. 

In the post–Cold War era, nonalignment has continued but faced by the rise of China, and the recent clash in the Galwan Valley, India needs to reconsider the policy and take a side in the international power rivalry—and that side means a closer link to the United States. Such a closer link may take the form of giving the U.S. Navy a strategic base along the Indian coast or in the Andaman and Nicobar Islands since would give the United States a strategic chokepoint to the Strait of Malacca.

A closer alignment with the United States would provide multiple advantages to India particularly when considering the two-front threat that India now openly faces. The Indian military has planned for a two-front war against China and Pakistan but such a conflict would stretch the Indian forces thin and in the aftermath of the war impose a significant economic burden on the economy as the country would have to rebuild and increase its military assets.  Giving the United States a base on Indian territory, however, raises the costs for both Pakistan and China of waging a war—whether limited or full-blown—because it would raise the ire of Washington and that is something that Islamabad certainly does not want while Beijing would have to reconsider its strategy.

Secondly, an alliance with the United States would make it far easier to transfer weapons technologies to India. The current Indian government has been pressing for a “Make in India” policy, especially for modern weapons systems. The problem with implementing this objective has been two-fold. As seen in the case of the recent Rafale purchase, where India wanted to build the plane at home, the country lacked the trained scientific personnel, infrastructure, and machine tools to do the job so the cost of the project ballooned. The bigger problem, however, which led to a choice of a French airplane over an American one, was that there were questions about India safeguarding American supplied technology. A formal alliance would go a long way to removing such concerns in Washington.

Indian Reservations

Indian politicians, diplomats, and academics will typically reject the idea of an alliance because in their eyes this would reduce or remove India’s ability to act with freedom on the international stage. This is a tired argument that comes from the time, in the 1950s and 1960s, when India was a poor nation that would have been constrained by an alliance with a superpower. Today, India is too big to be asked to be an obedient supplicant. Further, and Indian officials have trouble answering this question, have American allies lost their foreign policy autonomy through their alliances with Washington?  One cannot make the argument that Japan, Germany, and Britain have lost their autonomy and Turkey has been able to chart an independent foreign policy that made Ankara decide to buy the Russian S-400 air defense system even though it was seen as threatening the technological safeguards Turkey had put in place to buy the American F-35 Lightning fighter jet.

A more formal alliance would help alleviate the Indian security dilemma but can the overcautious, incrementalist, and unimaginative Indian foreign policy bureaucracy move in this direction? Not doing so may be a long-term threat to India’s security that will be costly to overcome.

Amit Gupta is an Associate Professor at the USAF Air War College. The views in this article are his and do not necessarily reflect those of the USAF or the US Department of Defense.

[anmol]

They didn't include Modi in this video...

China Global Television Network (CGTN) issued a nearly six-minute video entitled “Can COVID-19 beat populism?” in which the Chinese Communist Party-run network leverages the coronavirus as “another straw on the camel’s back to expose [Trump’s] hollow politics.”

In addition to attacking President Trump, the video also went after China-skeptic political leaders such as Brazil’s Jair Bolsonaro and Britain’s Boris Johnson.

[Kati]

Chinese consulate in San Francisco is harboring a military-linked researcher wanted for visa fraud, FBI says

https://www.cnbc.com/2020/07/22/chinese ... -says.html

[sajo]

We Indians are fine with Boycott and Sacrifice , as long as it is done by someone else. People have incredibly fickle memories!

[Suraj]

Depending on the public to implement a boycott of Chinese goods is NOT good state policy. This is the job of the government. The public cannot and should not be compelled to make foreign policy decisions. That is what we elect a government to accomplish. Indian foreign policy and trade policy have generally been weak at furthering Indian interests, both in isolation, and in the context of working together (which they arguably seldom do). Please don't waste time bemoaning the public's failure to act.

The government needs to continue its so far impressive efforts since Galwan to hurt Chinese economic interests in India. The smart approach is to do this quietly. There are MANY things that can be done (many of which have already been done):
* Quietly drop all Chinese bidders citing 'irregularities in bids', or anything that's a legally above board way of saying no
* Publicly state disbarment of Chinese companies, as a punitive government policy
* Block Chinese goods at ports, fail to offer customs clearance. Enhanced standards compliance testing with high profile media example of failure (remember the US customs burning dupattas and claiming fire hazard, and then banning Indian textile imports in the late 1990s ?)
* Ban all Chinese data sucking apps
* Focused targeting of Chinese imports by highest value items, e.g. finished manufactured goods, electronic items, fertilizers, chemicals and pharma items, and more. Replace the high value low hanging fruit quickly, then the next biggest items, progressively whittling down the surplus entirely.
* High profile crash test failures of Chinese automobiles followed by bans and embargo on operation.
* Ban just one brand of popular electronic goods due to some high profile accident. Repeat every few months with more companies.

The Chinese did something incredibly stupid by picking a fight with the second largest source of trade surplus they have from a single country. There's nothing they can do to retaliate. They can make the border situation worse, and thereby accelerate their own financial costs. They can't ban Indian imports effectively. For one we don't export much to them, and for another, it's mostly intermediate goods like ore that we would want to use ourselves to manufacture things we should be making ourselves instead of import from them. That is the game theory situation here. They can hurt us, at the cost of hurting themselves even more. They can avoid or minimize their economic cost by offering more. Thus we lose, they lose more , or they mitigate losses, we win, are the two possible results. There's no economic win for them, because they are already past 'peak surplus' as far as India is concerned.

[pankajs]

^^
Absolutely. GOI should pick one import at a time and fix it and aim to free Indian dependence in 5-6 years.

Alas, this should have started 6 years back may be with something as low and inconsequential as Agarbatti or Toys.

[Suraj]

Part 2 of the 'don't blame people' consideration is to stop wasting time bemoaning what wasn't done. It's a completely wasted exercise right now. The motivation to act going forward is there, and that is all that matters.

[pankajs]

While I agree with you on the general principle this needs to be pointed out in light of the "Make in India" slogan.

[chola]

The Chinese did something incredibly stupid by picking a fight with the second largest source of trade surplus they have from a single country. There's nothing they can do to retaliate. They can make the border situation worse, and thereby accelerate their own financial costs. They can't ban Indian imports effectively. For one we don't export much to them, and for another, it's mostly intermediate goods like ore that we would want to use ourselves to manufacture things we should be making ourselves instead of import from them. That is the game theory situation here. They can hurt us, at the cost of hurting themselves even more. They can avoid or minimize their economic cost by offering more. Thus we lose, they lose more , or they mitigate losses, we win, are the two possible results. There's no economic win for them, because they are already past 'peak surplus' as far as India is concerned.

Are they incredibly stupid or they simply see the payoff from hardening the border as advantageous and acceptable irregardless to the loss in economic activity in India? They might see India as a lost cause anyways. Look at Hong Kong. Its market is going through a historic boom with chini tech companies. Shanghai is too. They have angered the Five Eyes with their security law but perversely it has made HK more palatable to many firms, especially the chini ones, by stopping the riots dead.

There is a dangerous phenomenon happening right now. The chini economy is growing despite covid and massive flooding. We know this because every MNC that operates there from Tesla to Starbucks to Rio Tinto (Oz iron ore seller) is reporting sales growth in Cheen far beyond the rest of the world. They are revving up their internal engine. A cheen running on a far bigger internal economy than India in a de-globalized world would theoretically mean we can never catch up. We have hopes that in depriving Cheen of trade that we can slow down their growth relative to ours. But what if that is not the case? What if the CCP doesn't want chini venture capital in Indian startups or chini infrastructure firms providing cheaper alternatives for India's own infra and power or Chini firms to become more dependent on India?

An incredibly stupid enemy is easy to deal with. We need ask if they are truly incredibly stupid.

[nam]

Which is why I am happy the Chinis are continuing to squat on the Fingers. As long as they are there, GoI has no way to brush the whole incident under the carpet. The Chinis are trying hard to contain the losses. They haven't retaliated for the app ban.

And it is also due to our nutcase media, which has spread the whole thing like wildfire. It was wonderful to watch headlines like "China has invaded India with 10,000 troops" in world media during May

Things were working for the Chinis until the whole thing was under wraps. However the plan went pear shape after June 15. Now they have their hand in the pickle jar and cannot take it out without the world seeing it and CCP loosing face. India is no mood to make a face saving deal after our men were killed.


Our jokers in media have managed to make a major event. Even NYT has spend considerable effort to creating a wonderful graphical report on the standoff.

[nishant.gupta]

We Indians are fine with Boycott and Sacrifice , as long as it is done by someone else. People have incredibly fickle memories!

Nitpick maybe but Hector video is an ad. If that doesn't get that many views...what will!? Basically what I mean is that MG has paid youtube to show the ad and the views will be visible to you and me.

The other videos are of popular channels with crores of subscribers. Again, you will have lakhs of views for anything including an 8 hour video of them snoring.

[M_Joshi]

We Indians are fine with Boycott and Sacrifice , as long as it is done by someone else. People have incredibly fickle memories!

Nitpick maybe but Hector video is an ad. If that doesn't get that many views...what will!? Basically what I mean is that MG has paid youtube to show the ad and the views will be visible to you and me.

The other videos are of popular channels with crores of subscribers. Again, you will have lakhs of views for anything including an 8 hour video of them snoring.

I bought a new phone last month to replace my old Oneplus. Even though I saw new Oneplus YouTube videos out of curiosity, I still went ahead with Made in Vietnam Samsung even though it was expensive. If choice is there most people will pickup Indian stuff. Most people do not know. The govt should mandate the country of origin info in offline purchase as well like it has done with e-commerce recently. As more brands start manufacturing In India & advertising it. Choice for the consumers would become easier.

[Suraj]

chola: "What if walking away from a $50 billion surplus isn't really a stupid action ?" is not an argument with much merit. And no, that they have growth and a large market does not explain anything. That data just means that they have growth.

China historically has demonstrated competence in the economic sphere and TSP like tactical brilliance in the geopolitical domain in equal measure. For example, they've been extremely good at building their domestic market and export engine, such that they can recalibrate their economy in response to shocks like Covid or GFC .

However, their political structure is brittle in the sense that they have a very tributary minded view of the world where they are either biding their time or demanding tribute. Collaboration and synergy are for wimps in Chinese culture, and everything is fundamentally zero sum to them. India is a smaller border nation needing to be regularly slapped to show them their place, in between which they're sweet talked into making lucrative deals to open up their market to Chinese ware.

In their bid to push things too hard at Galwan, they find themselves in the same position as with their #1 source of trade surplus - the US. Taking up an antagonstic posture in this manner is stupid, regardless of their competence otherwise at managing their economy. It shows they have a military or geopolitical planning side that's disconnected from the economic planning side and the former may significantly harm their best interests even as the latter is being competent.

[Pratyush]

I have a newbie question - what is it that China hopes to gain by taking over Chabahar when it already has Gwadar? I mean-apart from the negatives of keeping the Indians out? Is there a commercial angle to the Chinese trying to take over Chabahar? Or is it a back-up in case the Gwadar thing comes to a dead halt with India playing spoilsport in Baluchistan or even Gilgit-Baltistan?

Its a question of removing access of India to the port. Rather than needing access for self.

[Pratyush]

This plane is equipped with a cardiogram monitor, respirator and other devices.

I am sure that the next plane to arrive will be eqipped with even more advanced medical items like gauze and bandages.


Frightened by Galwan wounds China deploys ‘flying hospital’ in Tibet

What is the antenna above the tail ramp. Doesn't look like an EW setup to me. Looks more like a radar fairing of a modern fighter to me. The question is why is a hospital plane having a radar in the tail.

[pankajs]

BlackRock and Goldman are still betting on China expansion.

https://twitter.com/mikepillsbury/statu ... 4955631625

Michael Pillsbury @mikepillsbury

BlackRock applies to set up China mutual fund business $14 Trillion asset management (third largest in the world) Goldman Sachs already approved https://ft.com/content/fec655ee-1003-40 ... 74615ad832
via @financialtimes

[chola]

chola: "What if walking away from a $50 billion surplus isn't really a stupid action ?" is not an argument with much merit. And no, that they have growth and a large market does not explain anything. That data just means that they have growth.

Surely the question must be posed, Saar! When people do stupid things is it because they are truly stupid or something Chankian is happening. I would expect the former if it were pakis but with chinis -- well, how do you end up the world's second largest power by being stupid?

Having growth in a pandemic where no one is trading and a large market means an ability to take potential economic losses for bigger gain elsewhere. Again, maybe they think India is a lost cause (we've had this thread and others a lot longer than this year!) and that market will eventually be lost anyways and can be sacrificed now for tactical gains on the ground. Maybe the CCP (not the chini firms) thinks that the venture capital from Cheen is helping India and wants to cut it off. In 2019, 17 out of 24 Indian unicorns (tech firms that capitalize at over $1b on startup) had Chinese vc.

Of course, they can simply be stupid. In that case, we have less to worry about.

[Suraj]

Surely the question must be posed, Saar! When people do stupid things is it because they are truly stupid or something Chankian is happening. I would expect the former if it were pakis but with chinis -- well, how do you end up the world's second largest power by being stupid?

IMHO you're overthinking this. Or perhaps prefer to dwell upon grand strategies of long term wins. It's your own thesis so no one else can consider it; you should provide an example where they gave up a hugely beneficial long term penetration into a major tributary market, for a better deal elsewhere ? It's important that the example be one where they *gave up* something they already had, as opposed to back out of a potential future opportunity.

"They're smart, and they've done something phenomenally stupid and already cost themselves what $10-15 billion with more coming, but since they're smart the action must have been smart", is literally circular logic, until you provide concrete examples of how they literally gave up 10-figure $ cash-in-hand gains for notional future gains that are supposedly larger.

Waving hands about regarding their market doesn't really have any relevance here. In the financial world, both black swan events *and* smart-guy-doing-stupid-things is very much par for the course, and even stupid acts leading to black swan events.

[Gyan]

Depending on the public to implement a boycott of Chinese goods is NOT good state policy. This is the job of the government. The public cannot and should not be compelled to make foreign policy decisions. That is what we elect a government to accomplish. Indian foreign policy and trade policy have generally been weak at furthering Indian interests, both in isolation, and in the context of working together (which they arguably seldom do). Please don't waste time bemoaning the public's failure to act.

The government needs to continue its so far impressive efforts since Galwan to hurt Chinese economic interests in India. The smart approach is to do this quietly. There are MANY things that can be done (many of which have already been done):
* Quietly drop all Chinese bidders citing 'irregularities in bids', or anything that's a legally above board way of saying no
* Publicly state disbarment of Chinese companies, as a punitive government policy
* Block Chinese goods at ports, fail to offer customs clearance. Enhanced standards compliance testing with high profile media example of failure (remember the US customs burning dupattas and claiming fire hazard, and then banning Indian textile imports in the late 1990s ?)
* Ban all Chinese data sucking apps
* Focused targeting of Chinese imports by highest value items, e.g. finished manufactured goods, electronic items, fertilizers, chemicals and pharma items, and more. Replace the high value low hanging fruit quickly, then the next biggest items, progressively whittling down the surplus entirely.
* High profile crash test failures of Chinese automobiles followed by bans and embargo on operation.
* Ban just one brand of popular electronic goods due to some high profile accident. Repeat every few months with more companies.

The Chinese did something incredibly stupid by picking a fight with the second largest source of trade surplus they have from a single country. There's nothing they can do to retaliate. They can make the border situation worse, and thereby accelerate their own financial costs. They can't ban Indian imports effectively. For one we don't export much to them, and for another, it's mostly intermediate goods like ore that we would want to use ourselves to manufacture things we should be making ourselves instead of import from them. That is the game theory situation here. They can hurt us, at the cost of hurting themselves even more. They can avoid or minimize their economic cost by offering more. Thus we lose, they lose more , or they mitigate losses, we win, are the two possible results. There's no economic win for them, because they are already past 'peak surplus' as far as India is concerned.

+1. Also under WTO Treaty we can impose punitive penalties, tariffs & restrictions under Security Clause 21

[Gyan]

I think China has decided that its time to Rise as the Main World Super Power. They are ready to pay the price. Let's look at their block:-

Russia & CIS
Pak, North Korea
Iran hence Qatar, Turkey
Germany hence Soft approach by rest of EU
ASEAN is soft on them just like New Zealand, Canada
Lots of African & poor Nations
Huge Segment of US Business

I think we are wrong in thinking that they did not plan it out. It may work or not but plan they did.

[chola]

Surely the question must be posed, Saar! When people do stupid things is it because they are truly stupid or something Chankian is happening. I would expect the former if it were pakis but with chinis -- well, how do you end up the world's second largest power by being stupid?

IMHO you're overthinking this. Or perhaps prefer to dwell upon grand strategies of long term wins. It's your own thesis so no one else can consider it; you should provide an example where they gave up a hugely beneficial long term penetration into a major tributary market, for a better deal elsewhere ? It's important that the example be one where they *gave up* something they already had, as opposed to back out of a potential future opportunity.

Perhaps I am but:

They are not giving up the Indian market for gains elsewhere in the economic sphere. They are giving up economic gains for gains on the geo-strategic front, whether it is ground on the border or stopping engagement of Chinese companies and capital that the CCP thinks would help India.

Secondly, the surplus of $50B is what they might have lost if this had happened last year. This year with the Wuhan virus our imports from Cheen must have cratered. We're in a recession as is everyone else. Next year, everyone will be focused on internal supply chains and jobs. If they perceive us as hostile anyways they might not think that surplus is going to come back and that lower potential can, again, be sacrificed for geo-strategic gains.

Waving hands about regarding their market doesn't really have any relevance here. In the financial world, both black swan events *and* smart-guy-doing-stupid-things is very much par for the course, and even stupid acts leading to black swan events.

No, an internal market is always relevant when talking about economic gains or losses. The chini post-covid tech initiative is $1.4T: https://www.bloomberg.com/news/articles/2020-05-20/china-has-a-new-1-4-trillion-plan-to-overtake-the-u-s-in-tech

The US stimulus is over $1.5T. The EU is looking at $2T.

So calculations of $50B last year, maybe a fraction of that this year and uncertainty in the coming years are absolutely peanuts against those numbers. Especially if they view the Indian market as intrinsically hostile and a lost cause in the near future anyways then $50B from 2019 might mean absolutely nothing in their forward calculations.

Saar, I do agree that "smart guys thinking they are doing smart things" can create black swans!

[chetak]

I am sure that the next plane to arrive will be eqipped with even more advanced medical items like gauze and bandages.


Frightened by Galwan wounds China deploys ‘flying hospital’ in Tibet

What is the antenna above the tail ramp. Doesn't look like an EW setup to me. Looks more like a radar fairing of a modern fighter to me. The question is why is a hospital plane having a radar in the tail.

that is generally the tail gunner's position in a soviet origin aircraft which this aircraft is probably a copy of

Here it would be just a dummy aerodynamic fairing unless they have temporarily repurposed this aircraft from a more lethal role than just a "flying hospital"

[Suraj]

They are not giving up the Indian market for gains elsewhere in the economic sphere.

Here's the basic logical challenge to your theory, since you've demonstrated you have no answer to the question of anyone literally giving up a large annual surplus:

The process isn't deliberate on their part. In fact, they did nothing different. Galwan was just the latest of decades of standard Chinese border incursion strategy. Everything that differed is in what WE did. Fundamentally, a black swan economic event is where one does the same thing they've been doing, but the response to the strategy is sudden, unexpected and costly, with no ability to mitigate.

Black swan events are about the inability to forecast the probability of highly unexpected events with extremely high costs. "India could retaliate and kill our $50 billion surplus" is a black swan. The standard hedge fund strategy is "we keep nibbling, there are some border arguments, and we keep nibbling AND make money in India". Like any hedge fund, this bias is always towards discounting the black swan for the immediate gain. Even in engineering parlance black swan events are hard to design for, eg the so called ‘1000 year flood’ kind of design mitigation approach.

A hedge fund analogy is the complex hedging and derisking mechanism of a large portfolio. This is tried, tested and regressed and is supposedly smart and addresses requirements. However, as you may know, any hedging strategy is biased by the developer's own biases as to expected behavior. A hedge in good times gets them border leverage here and there.

It typically works, but it doesn't have a trailing stop - if they losses happen suddenly because the other side reacted in a very disproportionate and unexpected manner, their only strategy is to curtain losses. The other side is going to come out better in the economic exchange regardless. Hitting back militarily is analogous to doubling down on losses - and you as a quant should know very well how that will go...

There's no relationship between Galwan and the US or EU stimuluses. The Chinese screwed up. It's costly for them economically, and they know that loud escalation will just accelerate their economic losses. That's why the great mighty PRC orders muzzling of the military casualty counts and asks that soldier deaths be quietly cremated.

China first and foremost desires geopolitical domination. In this situation they can't escalate and aggressively dominate - it just means they lose more than otherwise. Their only meaningful approach is to quietly nibble again, and that's exactly what they're already doing again.

"They're smart, they must have thought up something" isn't an answer. You'll have to do better. Theories first and foremost have to fit the empirical data. Your argument lacks that, and is essentially a circular logic argument, as you've failed to present anything by way of example that might serve as empirical data in support, or even establish a causal relationship.

[Vamsee]

Link

NSitharamanOffice
@nsitharamanoffc
The Govt. of India today amended the General Financial Rules 2017 to enable imposition of restrictions on bidders from countries which share a land border with India on grounds of defence of India, or matters directly or indirectly related thereto including national security.

=============

China is barred from participating in any Central/State or Govt+Private PPP projects

--Vamsee

[yensoy]

The process isn't deliberate on their part. In fact, they did nothing different. Galwan was just the latest of decades of standard Chinese border incursion strategy. Everything that differed is in what WE did. Fundamentally, a black swan economic event is where one does the same thing they've been doing, but the response to the strategy is sudden, unexpected and costly, with no ability to mitigate.

You are spot on. Our reaction this time has been resolute, in particular the follow up on the economic front.

Chinese love to portray India as a backward and poor nation. What they will never acknowledge is the scale and profitability we give to their products, so you will never hear from them that they are hurting. They will complain about loss of access, discrimination, racism and everything, they will impose further restrictions on imports from us, but they will never admit that they have been hurt.

The only thing to watch out for is Chinese export restrictions on us for machinery, heavy engineering and tooling which is critical to the development of our own infrastructure and industries. Why sell us machines to make stuffed toys if we are no longer going to import stuffed toys from them? ...or tunnel boring machines, gantry cranes, excavators, pharma APIs, boron carbide or Covid testing reagents. We may have to source our machinery through 3rd parties, or import from the West ($$), or buy used or build our own (won't always be possible).

[Kati]

US arrests three Chinese nationals for visa fraud
BBC BBC•July 23, 2020

The US and China have clashed repeatedly in recent months, over trade, coronavirus and Hong Kong
The US has charged four Chinese nationals with visa fraud for allegedly lying about their membership of China's armed forces.

Three are under arrest while the FBI is seeking to arrest the fourth, who is said to be in China's San Francisco consulate.

FBI agents have also interviewed people in 25 US cities who have an "undeclared affiliation" with China's military.

Prosecutors say it is part of a Chinese plan to send army scientists to the US.

Members of the People's Liberation Army (PLA) applied for research visas while hiding their "true affiliation" with the military, US justice department attorney John C Demers said in a press release.

"This is another part of the Chinese Communist Party's plan to take advantage of our open society and exploit academic institutions."

What's behind Trump's new strategy on China?

The Hong Kong crisis and the new world order

The arrests come after the US announced a Chinese scientist had taken shelter in the San Francisco consulate, and the day after US officials ordered the closure of China's mission in Houston, saying it was involved in stealing intellectual property.

On Thursday - before the arrests were announced - Chinese foreign ministry spokesman Wang Wenbin described the US allegations as "malicious slander" and said China "must make a necessary response and safeguard its legitimate rights".

US President Donald Trump has repeatedly clashed with China in recent months, over trade, the coronavirus pandemic and the new Hong Kong security law.

What are the charges?
The four individuals charged with visa fraud are Wang Xin, Song Chen, Zhao Kaikai and Tang Juan. Ms Tang is thought to be in the San Francisco consulate.

All the Chinese nationals are said to have lied about their service in the PLA, either stating they had never served in the military or no longer served.

Wang Xin was arrested on 7 June after questioning by Customs and Border Protection agents at Los Angeles International Airport. He disclosed that he remains a PLA member, and works at a military university lab, the justice department release said, having stated on his visa that he had left the military in 2016.

Song Chen and Zhao Kaikai meanwhile were both arrested on 18 July.

Prosecutors allege that Ms Song claimed to be a neurologist who had left the armed forces but in reality was still affiliated with PLA Air Force (PLAAF) hospitals in China, while Zhao Kaikai claimed never to have served in the military but in fact was a member of a top PLA research institution.

Ms Tang is thought to be a member of the PLAAF. An agent found photos of her in military uniform and evidence that she worked at an air force medical university.

She also allegedly wrote on her visa application that she had never been in the military.

[Suraj]

The only thing to watch out for is Chinese export restrictions on us for machinery, heavy engineering and tooling which is critical to the development of our own infrastructure and industries. Why sell us machines to make stuffed toys if we are no longer going to import stuffed toys from them? ...or tunnel boring machines, gantry cranes, excavators, pharma APIs, boron carbide or Covid testing reagents. We may have to source our machinery through 3rd parties, or import from the West ($$), or buy used or build our own (won't always be possible).

I have no problem with this. In fact I hope this happens, because I've repeatedly advocated that Indian heavy engineering companies should attempt to replace imported construction and infrastructure operation gear with home made solutions. For example, TBMs in the railway thread within the past 1-2 weeks.

It is also important to understand ones strengths and weaknesses. India has always historically done important and meaningful things (economic reforms, political consolidation, and more) only when presented with a major crisis or inflection point. Our system is too 'noisy' to incrementally build a long term picture in quiet peacetime. That doesn't happen. There's no point in moaning about it. Moaning just reflects lack of understanding of one's own strengths and weaknesses, and is analogous to moaning 'I'm not as fast as Usain Bolt / beautiful as Aishwarya Rai, woe be me'.

Therefore, in the Indian context, crises are good. Never let a good crisis go to waste, so to speak. The Chinese are the opposite. Their system is geared towards tamping down high noise/oscillation and building incrementally. They almost always tend to overreact or otherwise hurt their long term interests in crisis moments. Their history is replete with dynasty after dynasty incrementally building great accomplishments in quiet peacetime and then imploding, then the next lot doing exactly the same thing, sometimes with dramatic conclusions like the last emperor running off into the garden and hanging himself, Pindi crore kamandu style.

Indian history has no such meme. Quite the opposite in fact - even the scope for conflict between Hinduism and Buddhism resulted in battle of better or more long lasting philosophical tradition (i.e. Advaita Vedanta and related scholarship). In China, the result would have been the wise scholars of the losing side being lined up and shot - which is what happened in the case of their extinct philosophies. In India, the 'loser' became a wildly popular philosophical export in its own right, even more broadly followed than the winner.

[KLNMurthy]

...

Are they incredibly stupid or they simply see the payoff from hardening the border as advantageous and acceptable irregardless to the loss in economic activity in India? They might see India as a lost cause anyways. Look at Hong Kong. Its market is going through a historic boom with chini tech companies. Shanghai is too. They have angered the Five Eyes with their security law but perversely it has made HK more palatable to many firms, especially the chini ones, by stopping the riots dead.

There is a dangerous phenomenon happening right now. The chini economy is growing despite covid and massive flooding. We know this because every MNC that operates there from Tesla to Starbucks to Rio Tinto (Oz iron ore seller) is reporting sales growth in Cheen far beyond the rest of the world. They are revving up their internal engine. A cheen running on a far bigger internal economy than India in a de-globalized world would theoretically mean we can never catch up. We have hopes that in depriving Cheen of trade that we can slow down their growth relative to ours. But what if that is not the case? What if the CCP doesn't want chini venture capital in Indian startups or chini infrastructure firms providing cheaper alternatives for India's own infra and power or Chini firms to become more dependent on India?

An incredibly stupid enemy is easy to deal with. We need ask if they are truly incredibly stupid.

Presumably, with all the what-ifs and the loaded questions, you really want to say, hey the Chinese are actually brilliant and Chankian onlee, we just can't see it, because, what? We are Indian and stupid ourselves? OK fine, maybe so, but then what?

I have seen your other posts advocating outright war, right away, right now. Conquer Tibet or whatever. If the Chinese are that brilliant and Chankian and we are that stupid, is it such a good idea to have an outright war with them? It would be a much better strategy in that case to put on our dhoties, crawl under our beds and lie there, shivering till we wither away and die.

All policies are based on some kind of premise and (hopefully reasonable) assumptions about the adversary. There is always a chance that the premise is wrong, and a lot of the time, there is no hedging strategy for the case that we are wrong about the premise. For example, we keep going on with our lives with some strategy and plan, but what if a meteor falls on our heads tomorrow? What then? Well, we don't have a strategy for that, and probably can't have one. At least not a sensible strategy. We could say, let's just go out into space and blow up all the meteors before one of them falls on us, and declare our glorious victory, but that'd just be empty talk. Nobody with any common sense is going to do it.

If the Chinese do great with their own internal economy after the entire world, starting with India cuts them off, then let them. That's wonderful. But they don't even think they can do that right now, otherwise why do all the costly & risky BRI stuff and why all the global aggression? And if they are wrong in that, and they become rich & prosperous (even more) with a purely internal economy, what goes of our father then? We'll mind our own business and they theirs. Isn't that we always wanted?

[chola]

Presumably, with all the what-ifs and the loaded questions, you really want to say, hey the Chinese are actually brilliant and Chankian onlee, we just can't see it, because, what? We are Indian and stupid ourselves? OK fine, maybe so, but then what?

I have seen your other posts advocating outright war, right away, right now. Conquer Tibet or whatever. If the Chinese are that brilliant and Chankian and we are that stupid, is it such a good idea to have an outright war with them? It would be a much better strategy in that case to put on our dhoties, crawl under our beds and lie there, shivering till we wither away and die.

I advocated for outright war, especially during Doklam, because the numbers on the ground and the years of experience were pointing to a better outcome for warfare than waiting it out. The numbers were too f-ing GLARING. We had 250K to 21K (only 3 PLA brigades in TAR) on the border and the chinis had no experience in warfare for 40 years.

It is far better take on them kinetically than play the waiting/economics game. They can't fight but they can build and create wealth.

I find the wait till we are 5T economy to act dangerous because the chances are they will grow even larger and have even more stuff by then. If we need to strike, it is far better now than in the future.

If the Chinese do great with their own internal economy after the entire world, starting with India cuts them off, then let them. That's wonderful. But they don't even think they can do that right now, otherwise why do all the costly & risky BRI stuff and why all the global aggression? And if they are wrong in that, and they become rich & prosperous (even more) with a purely internal economy, what goes of our father then? We'll mind our own business and they theirs. Isn't that we always wanted?

Nothing wrong if it doesn't bother us that they can build and grow on our LAC like they did in the SCS with artificial islands except that it would be bases in the mountains.

I think that if we feel punishing them by cutting off from our economy is enough then there goes all impetus to correct the situation by force which to be honest is more suited to our set of advantages. Waiting for chit to build up suits theirs.

If their internal economy expand, they WILL take BRI along with them because all of our pissant neighbors, Iran, the Gulf States, Turkey and the Russians will want in. The Ango-Sphere might not like it but the BRI doesn't go through them.

I'll drop it. I look at numbers like a business analysis and it might not work here.

[KLNMurthy]

I think China has decided that its time to Rise as the Main World Super Power. They are ready to pay the price. Let's look at their block:-

Russia & CIS
Pak, North Korea
Iran hence Qatar, Turkey
Germany hence Soft approach by rest of EU
ASEAN is soft on them just like New Zealand, Canada
Lots of African & poor Nations
Huge Segment of US Business

I think we are wrong in thinking that they did not plan it out. It may work or not but plan they did.

They are banking on US collapse, and from their POV it's not altogether stupid, as evidenced by the divisiveness in American polity and the absurdly inept way in which US has been handling the pandemic.

"Giving up on India" (which chola brought up) from their POV constitutes admitting that India will be a vassal of the US. They don't have the eyes to see India as an independent power that is potentially capable of resisting them practically indefinitely, with or without some kind of alliance with the US.

With both the US and with India they are underestimating their level of risk. Even if the US descends even more into internal chaos and maladministration, the US military will the last one to fall apart, and before that happens, they can crush China in conventional warfare, not to speak of the nuclear scenario. It's a bad idea to have a mainline strategy that counts on internal chaos in a powerful enemy country that will leave it with only the military card to play. Much better to (as the US did with former USSR) to let the weakening happen on its own, and at an opportune moment, negotiate the adversary's honorable-seeming exit from the competition.

With India, I can't see any scenario in which a China playing military offense will overwhelm an India playing military defense, at least not one that doesn't culminate in a cornered India gong for the nuclear option. Again, intelligent countries and cultures know better than to militarily push a nuclear-armed adversary the way China is pushing India. Sure, India is generally passive and peace-mongering, but that just means the escalation threshold is higher, and when it comes, the escalation also will be higher. Even "mighty US" doesn't push piddling North Korea militarily because it makes no sense to take that kind of risk.

That leaves attacking India with internal propaganda sabotage with paid or todaying media and politicians etc. Even here, they misfired big time, with the Galwan episode. The entire fifth-column in India is so obsessed with their fear & resentment of Modi's machismo that their subversive energies have become focussed on trying to drive Modi sarkar into making war, and being even more belligerent with China, rather than making nice and making peace with China on China's terms.

Chinese have taken a dangerous, high-risk path, for no apparent reason. If they had kept a low profile and gone about their sneaky colonizing business, they would have owned a major part of Africa, Southeast Asia, central Asia and probably Iran and even Russia in about 10-20 years. Instead they got impatient and showed their true colors too early, making it impossible for the world powers to just let them be and rake in their share of the profits.

[Vayutuvan]

Chinese have taken a dangerous, high-risk path, for no apparent reason. If they had kept a low profile and gone about their sneaky colonizing business, they would have owned a major part of Africa, Southeast Asia, central Asia and probably Iran and even Russia in about 10-20 years. Instead they got impatient and showed their true colors too early, making it impossible for the world powers to just let them be and rake in their share of the profits.

KLNMurthy garu, they may not have that much time either due to economic/fiscal reasons or they fear some kind of uprising within the year. Probably nCV damaged them a hullva lot more than they are letting out. HK is there for all to see but what were the effects of nCV and COVID19 on their polity, party power dynamics, and economy? Only they know and hence the sense of urgency, perhaps.

If that is the case, losing this round with India is going to decelerate, if not reverse, their 'peacefur lise' ending in is Xi faction getting the boot or the noose. Hope that results in a setback of a decade or two.

Meanwhile, if nature takes its revenge in the form of 3gorges getting washed out or any other number of environmental problems they created, that would be a the end of China as a country.

[Manish_Sharma]

https://www.news18.com/news/india/there ... 30627.html

There Will Be No Business with China as Usual until Complete Disengagement at LAC: Indian Envoy to Russia

JULY 23, 2020, 10:56 PM IST

India's Ambassador to Russia Venkatesh Varma on Thursday said that New Delhi has made it clear it will not do business with China as usual until there is a complete disengagement of military forces along the Line of Actual Control (LAC) and de-escalation in Eastern Ladakh.

"While India seeks to resolve these problems through dialogue, we have made it clear that we will not do business with China as usual until there is a complete disengagement of military forces along the Line of Actual Control and de-escalation in the border areas in accordance with bilateral agreements and protocols. As Prime Minister (Narendra) Modi noted, this is an era of development, and the era of expansion has come to an end," Varma said in an interview to Izvestia newspaper.

"India and China are negotiating through diplomatic and military channels about the situation on the LAC in border areas between the two countries," he said. "Foreign Minister S Jaishankar and NSA Ajit Doval have conducted talks with their Chinese counterparts."

Varma said that India does not believe in trade war with any country. "The ban on some Chinese apps is a measure to ensure digital security," he added.

There Will Be No Business with China as Usual until Complete Disengagement at LAC: Indian Envoy to Russia
India's Ambassador to Russia Venkatesh Varma said that India does not believe in trade war with any country and the ban on some Chinese apps is a measure to ensure digital security.


Representative image.No Business with China as Usual until Complete Disengagement at LAC: Indian Envoy to Russia
India's Ambassador to Russia Venkatesh Varma on Thursday said that New Delhi has made it clear it will not do business with China as usual until there is a complete disengagement of military forces along the Line of Actual Control (LAC) and de-escalation in Eastern Ladakh.

"While India seeks to resolve these problems through dialogue, we have made it clear that we will not do business with China as usual until there is a complete disengagement of military forces along the Line of Actual Control and de-escalation in the border areas in accordance with bilateral agreements and protocols. As Prime Minister (Narendra) Modi noted, this is an era of development, and the era of expansion has come to an end," Varma said in an interview to Izvestia newspaper.

"India and China are negotiating through diplomatic and military channels about the situation on the LAC in border areas between the two countries," he said. "Foreign Minister S Jaishankar and NSA Ajit Doval have conducted talks with their Chinese counterparts."

Varma said that India does not believe in trade war with any country. "The ban on some Chinese apps is a measure to ensure digital security," he added.

India has banned 59 mobile apps with links to China, including TikTok, on the grounds of compromising national security, integrity and defence.

Varma said India and Russia share common interests, so that the Indo-Pacific region becomes a region of peace, stability and economic prosperity and prevents any country from seeking unilateral advantage at the cost of the entire region.

We believe that the Indo-Pacific Concept is aimed at promoting cooperation, connectivity and compliance with international law and norms, in one of the most significant parts of the world," he added.