The effect on Sino–Indian relations
The Sino–Indian relationship is worryingly ambivalent. On one side of theequation we see a flourishing people-to-people relationship underwritten bywhat is projected to be the world’s largest bilateral trading partnership sometimebetween 2010 and 2020. In the past four years, trade has grown at a phenomenalaverage of 52 per cent to a total of US$25.76 billion in 2006/07; trade is on trackto being worth US$40 billion by 2010 (Acharya 2008:10).China and India have also made a mutual decision to set aside fighting abouttheir disputed border while the two giants develop their economies and enterworld markets—known in the case of China as the ‘peaceful development’doctrine. In 2005, the two agreed on a set of ‘guiding principles’ to govern bordernegotiations. There is a flourishing process of two-way visits, even at the seniormilitary level, culminating in the visit of president Hu Jintao to India in late2006 and the reciprocal visit of Prime Minister Manmohan Singh to Beijing inJanuary 2008. In recent years, China’s image of India has evolved from that of a weak country of no real consequence to what the Chinese call a ‘comprehensivenational power’.
2
This is not, however, a simple relationship from India’s perspective. India’strade deficit with China has been growing and now stands at more than US$9billion.
3
As Chinese imports increase into what should be a labour-intensive
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Sino–Indian relations and the rise of China
manufacturing country, the vaunted trading ‘revolution’ could look lesspromising from the Indian perspective. India asserts that China is dumping largequantities of manufactures onto the Indian market. New Delhi has refused vitalChinese investment in key areas that it considers to be security risks, such astelecommunications and port development. It continues to deny China marketeconomy status and resists China’s offer of a free trade agreement. Clearly, thisis a country that lacks confidence that it can meet the economic challenge posedby its giant neighbour.The issue of the contested border can also be presented in negative as well aspositive terms. China’s ambassador to New Delhi shocked India two days beforeHu’s visit by asserting that Arunachal Pradesh—a populated part of India—wasstill disputed territory. The Indians were of the view that China had previouslyconceded that it belonged to India. The Chinese reversal could simply have beenviewed as tough negotiating tactics in Beijing, or it could have reflected Chineseconcerns about Tawang, in populated Arunachal Pradesh—the birthplace of the sixth Dalai Lama. It was, however, perceived in New Delhi as ‘disingenuousyo-yoing designed to keep India second-guessing and on its back foot’ (Aiyar2008). According to the Indian version of the 2005 guiding principles, Chinaalso breached those principles in laying claim to a portion of land containing asubstantial, settled population. It caused India to question seriously China’sveracity as a negotiating partner and possibly to wonder how China might behaveonce truly powerful.Closely associated with border issues is the issue of water. According toRamachandran (2008), China’s plans to divert 40 billion gallons of water annuallyfrom rivers in Tibet—especially the massive Yalong Tsangpo, which becomesthe Brahmaputra in India and subsequently the Megnad in Bangladesh—to theparched Yellow River Basin are causing considerable concern in India andBangladesh. The situation is exacerbated by the melting of the Himalayan glaciersthat feed the great rivers of Asia, on which 47 per cent of the world’s populationdepends. Ramachandran concludes that China’s plans mean it will ‘acquire greatpower leverage over India, worsening tensions between these two countries’.China’s growing footprint in the Indian Ocean, and especially in South Asia, isalso deeply worrying to a country such as India, surrounded as it is by vulnerableborders and volatile countries with which it is often at loggerheads. China isselling weapons to all India’s immediate neighbours except Bhutan andconstructing deep-water ports in Myanmar, Bangladesh, Sri Lanka and Pakistan.Although claims of Chinese military bases in Myanmar are exaggerated, Indiafeels surrounded in its own backyard.
4
India’s discomfort with China’s growing Indian Ocean footprint is expressedmost clearly at the official level in the Indian Maritime Doctrine, issued to thepublic in 2005. Having declared that the Indian Ocean is India’s ‘backyard’ and
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Rising China: Power and Reassurance
outlining an ambitious schedule for Indian naval expansion in the Indian Ocean,the document cites China as a major reason for this expansion in the followingterms: ‘China has embarked on an ambitious military modernizationprogramme…the [People’s Liberation Army] Navy, which is the only Asiannavy with an SLBM capability, is aspiring to operate much further from its coastthan hitherto.’
5
India and China have also become locked in urgent competition for energy inthe Middle East, Africa, Central Asia and Myanmar. This sense of competitionhas become all the more urgent for India because of the poverty of its domesticsupplies of liquid hydrocarbons and its energy-intensive requirements formaintaining economic growth from a low base.Some observers assert that India and China have adjusted their competition forenergy such that they do not unduly compete in the same markets and inflateprices (Khanna 2008). India was nevertheless shocked to find that natural gasfrom two leases it had helped to develop in the Shwe field off Myanmar wassold by Myanmar’s nationalised oil company not to India, as expected, but toChina. This unexpected loss was likely due to pressure on the Myanmar juntafrom China (see Clarke and Dalliwall 2008; Lees 2006). Moreover, in seekingcompensation, India was apparently given sole controlling rights to Sittwe port,which it is developing—but this too was later overturned, again apparentlyafter pressure from China (Lees 2006).Although the
official
Indian position on China is positive, if one scratches thesurface, Indian commentary often quickly descends to visceral suspicion of China. Such commentary ranges from the prominent Indian academic BrahmaChellaney (2008), who asserts that in ‘order to avert the rise of a peer rival inAsia, China has sought to strategically tie down India south of the Himalayas’,and the commentary of officials such as Admiral Prakash, who said India wouldkeep a ‘close eye’ on China’s naval intentions in the Indian Ocean (OPRF 2005:9),to India’s Maritime Doctrine, cited above.
projected slowdown in China’s growth and a somewhat lesser slowdown inIndia’s.
Figure 5.2
Projected growth rates of India, China and the United States in marketexchange rates and purchasing power parity
As in Winters, L. Alan and Yusuf, Shahid (eds) 2007,
‘Dancing with Giants’: China, India and the globaleconomy
, World Bank and Institute for Policy Studies (Singapore), Washington, DC, p. 6.
.Obviously, such economic and defence spending projections depend onassumptions that ‘all things will remain equal’. There are several importantunknowns in the category ‘all things’.First, there is the issue of political stability in both countries. Commentatorshave argued persistently that India is both penalised and advantaged by thefact that it has remained a vibrant democracy. It is penalised in the sense thatits consensual decision-making processes mean that it has not been able to actforthrightly to develop its economy in the way that China has, enabling thelatter to maintain spectacular growth rates in the past three decades. Then again,India might in future be advantaged by the fact that it has already crossed theRubicon of democratisation, while China has not. That process, should it occur,could also be highly destabilising for China, with concomitant economiceffects—or so the argument runs.
1
This view of the future of China is, however, increasingly subject to challenge.For example, recent research by the respected Pew Research Center (viewed 28August 2008, <
http://pewglobal.org/reports/display.php?Report ID=261>)shows that 86 per cent of Chinese people ‘are satisfied with the country’s overalldirection’. The Pew Center research was conducted after the riots in Tibet butbefore the May earthquake. The same question asked in 2002 elicited a favourableresponse on the part of only 48 per cent of respondents. It is also noteworthythat respondents reported far less satisfaction with their own lives than withthe general direction of the country. Moreover, the recent global downturnappears to have resulted in a significant decline in factory employment in China.Obviously, the data need to be treated with caution.
They do, however, give uspause to consider whether China is, indeed, inevitably bound to liberalise itspolity in the foreseeable future.Aside from the Pew Center’s research, there are other views being broughtforward to challenge the belief that China must inevitably confront a damagingcall for more democracy. According to Ma (2007), ‘The links between economicliberalization and political reform…have turned out to be much more complicatedand tenuous in the case of China.’At the same time as doubts are gathering about the inevitability of democracyin China, there is every indication that India’s politics will continue to be shapedby unstable coalitions and will be subject to considerable volatility, especiallygiven current energy shortages and inflationary pressures. India’s nationalelection, scheduled for May 2009, is likely to result in yet another weak coalition,one that this time might not last the full five-year term.
Balancing China and India–US relations
From India’s perspective, there is already a hedging quality in India–US relations,notwithstanding that New Delhi has made it clear to the United States that itdoes not wish to be a pawn in any balancing game against China, or any othercountry.
This hedging quality is evident in the evolving strategic relationship, which,significantly, was initiated in 1991 by the then Commander-In-Chief, PacificCommand (CINCPAC), and which has since developed powerful military–strategicovertones, with the apparent agreement of India.While there are many voices and motives in Washington directing the natureof the Indo–US rapprochement, at the heart of the relationship is the UnitedStates’ desire to create of India a major Asian military power capable eventuallyof helping to balance China’s rise. It is important to recognise that this ambitiondoes not necessarily imply that Washington believes it can win and maintainIndia as an ally, but rather that it will unsettle the power equation for China tohave another Asian power—and one that is already in competition—risingrapidly in military capability.The supposition here is twofold: first, a powerful India will be a more benignand pro-United States presence in the region than a powerful China; and second,if the United States refuses to give India what it wants—strategic parity withthe P5 nuclear states—then others, such as Russia, will.This desire on the part of the United States is a major factor behind the Indo–USnuclear agreement, which is not to say that other motives are not also present.The reason why the nuclear agreement is important is that it will be difficultfor the United States to support and build Indian power in some keytechnologies—for example, ballistic missile technology, anti-ballistic missilesand space—without first bringing India into ‘the nuclear tent’.This, then, is the deal—and where it cannot be done directly with US support,it can be done through the surrogacy of Israel, which has drawn increasinglyclose to India on high-tech military exchanges.That this interpretation is correct is suggested by statements by the BushAdministration of unambiguous support for India’s rise as a
major
Asian militarypower made at the time when the nuclear deal was first mooted. According toSecretary of State Condoleezza Rice’s policy adviser, this shift in US policy ismotivated by the fact that the United States’ ‘goal is to help India become a majorworld power in the 21st century’. He added, ‘We understand fully theimplications, including military implications, of that statement’<?lb?>(Rajghatta2005).
6
It is also explicit in the type of technologies being transferred to India—throughthe United States directly and through Israel. These include an ABM systemprobably based on the Israeli Arrow 2, in turn developed jointly with Boeingwith US technology. While Arrow 2 is an anti-tactical ballistic missile, Arrow3 will have an anti-MRBM capability. India is also to launch Israel’s new spysatellite in early 2009; a quid pro quo could be assistance with India’s ownmilitary satellite program, which will be especially important for its naval
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Rising China: Power and Reassurance
targeting in the Indian Ocean and, eventually, a more sophisticated ABMcapability. Israel has also sold to India, with US permission (previously deniedto China), the Phalcon AWAC system. The United States has also directly soldsophisticated targeting radars and large naval vessels. The United States is alsoin the market for India’s new strike-fighter project.While the transfer of military technology is important, the deepeningmilitary-to-military relationship also brings with it the exchange of militarydoctrine, inter-operability and intelligence. This is very much an evolving,multifaceted relationship, albeit one focusing on maritime warfare. At its heartis a 10-year defence agreement signed in 2005 and a program of ever moresophisticated exercises, especially in the maritime sphere.None of this indicates, however, that India will enter any US ‘sphere’ or abandonits important relationships with other powers, especially Russia. While therehave been recent hiccups in the arms sale relationship between India and Russiato do with late delivery, escalating costs and poor supply of spare parts, therelationship is still of considerable importance to India and will not be easilydiscarded.Indeed, from India’s point of view, it can continue to conduct its strategy of ‘playing both ends against the middle’, as it has attempted to do, with varyinglevels of success, as a central plank of its foreign policy over many years. Withinthis pattern, however, it will likely ‘tilt’ somewhat towards the UnitedStates—the exact reversal of the situation during the Cold War.As time goes on, and given the hypothesis of a China that rises more rapidlythan India, this ‘tilt’ could increasingly take on an element of power balancing,whether New Delhi feels comfortable with that role or not. Nor is this label likelybe used in New Delhi.Of course, it needn’t happen that way, but the drivers of a more successfuloutcome will have far less to do with Sino–Indian relations and far more to dowith Sino–US relations and US–Russian relations. Should competition betweenChina and the United States intensify, China’s rise in Asia is unlikely to be aneasy one.As a ‘swing’ state in Asia—to use the term of the US Central Intelligence Agency(CIA)—India is therefore likely to be courted by a number of other rising powers.It will make the best it can of this situation in order to acquire the means tomilitary and economic power itself—whether it be Russian energy and platformsor US/Israeli high technology.
Conclusion
It is not at all clear whether China and India will rise equally. Indeed, it issomewhat more likely than not that China will continue to draw away from India
economically and militarily. Should this occur, India could seek implicitly (oreven explicitly) to balance China’s rise, either through an intensifyingrelationship with the United States or, less likely, with Russia. India is, however,unlikely to enter into any formal alliances during this process; and the ultimatenature and extent of this power-balancing arrangement will depend more onSino–US, Sino–Russian and Russia–US relations than it will on the relationshipbetween those three countries and India.While the best outcome would be something akin to Coral Bell’s (2005) ‘concertof powers’, such an outcome is not at all certain. Indeed, it is a ‘slippery slope’around the edges of a concert of powers arrangement that leads quickly to classicpower balancing. A concert of powers implies, among other things, that Indiaand China will be able to control and channel their emerging competition inproductive ways. While this too is a distinct possibility, I have tried to show inthis chapter that it is by no means a certainty. Indeed, there are some deep-seatedconcerns in India about a rising China and what this means for India’s positionin its sub-Himalayan backyard.
Gimme a break!)