Something About The Law

Musings Pertinent to Law and Society

Part IV – A Race to the Top.

Posted by Arun On January - 2 - 2010

(Concludes the analysis on Indo-China Relations)

Competitiveness stems from both countries being acutely aware of their growing influence in South and East Asia. While China is still ahead in terms of human development indices, economic growth and military capabilities, India is hot on its trail. In fact, many observers have predicted that the Indian economy would overtake China’s in the near future, due to a number of advantages in terms of ‘soft’ infrastructure – transparent corporate governance, a sophisticated intellectual property law regime, and a democratic system founded on the rule of law. In conjunction with the growing economic firepower, strategic influence is also expected to burgeon.

This rivalry has manifested in a number of measures by both countries, to exert their influence in the neighbourhood. China has consistently used its ‘all-weather’ friendship with Pakistan as a wedge against Indian interests in and around Kashmir; Chinese investment in Pakistan has been massive, and range from strategic sea ports in Gwadar (near the Strait of Hormuz) and nuclear reactors in the Punjab region, to development and infrastructure aid in Pakistan-occupied Kashmir (PoK). India has often expressed its concern towards growing Chinese support for Pakistan’s military ends, especially after the nuclear tests of 1998, and the issue remains a sore point between both countries.

China’s alliance with Pakistan is seen as a part of a larger policy of encirclement, or as some analysts call it, a ‘string of pearls’ strategy (seen in picture) , to curtail India’s influence in South Asia. While the Chinese establishment is quick to deny such expansionist claims, its initiatives from the Strait of Malacca to the Persian Gulf (and across the Indian Ocean) do seem to suggest that the country is trying to spread its geopolitical influence in systematic fashion. China has not only engaged in projects of strategic and developmental importance with countries where it has traditionally held sway, such as Myanmar, but has also ventured to develop stronger relations with Nepal, Sri Lanka and Bangladesh, which have strong connections with India.

Notwithstanding such containment measures, India’s international stature and rising Asian influence has been a cause of concern to China. Having inked landmark nuclear deals with the U.S, France and Russia, India has been accepted into the nuclear fold, despite alleged involvement by China to scuttle a waiver grant from the Nuclear Suppliers Group (NSG). The 1-2-3 nuclear deal is also part of a larger strategic involvement with the United States, and comes at a time when India has been dehyphenated from Pakistan and is often seen as a buffer state against growing Chinese interests. Although India has no comprehensive policy in place to counter China’s ‘string of pearls’ strategy, its influence on neighbours can hardly be measured on the wane. In addition, India’s acknowledged influence and development-oriented partnership with Central Asian economies also reflects the country’s emergence on the global scene.

India has also entered into a number of strategic relationships, seen as measures to mitigate Chinese hegemony in Asia. The Indian Government has been actively pursuing its ‘Look East’ Policy agenda and on this count, has deepened ties with Japan and Australia. India is also constantly improving its commercial relations with the ASEAN and the East Asian Community.

The simmering tension between these two Asian forces on regional, and often, global fronts, has manifested in a number of bilateral ‘incidents’. The argument that China uses border uncertainties as a pressure tactic on India certainly seems compelling in the light of the aforementioned circumstances. Given the conducive nature of a peaceful land border to development on both sides, China’s actions do seem to be directed at a larger motive, and to place its thumb firmly on the pulse of the region. On the other hand, many commentators in India consider Tibet to be a trump card against Chinese intimidation. Besides using the Dalai Lama’s presence in Dharamsala to highlight the country’s firm commitment to human rights, the Indian Government has often been urged to leverage his asylum against China’s constant worry of ethnic protests and social unrest in the Tibet and Xinjiang Uighur Autonomous Regions. Thus, both countries constantly find themselves at loggerheads, creating awkward and sometimes dangerous situations.

Given the high stakes involved in Indo-China relations, it is clear that both nations perceive the futility of any belligerent act. Nonetheless, the air of distrust and rivalry is expected to continue as both these nations power their way through the next few decades.

Image courtesy: Sangam.org

Part III – Clash of the Giant Economies

Posted by Arun On January - 2 - 2010

(The third and penultimate post on Indo-China relations)

India and China: ‘Rivals in Partnership’

To determine the accuracy of such a conclusion, it is important to observe the growing influence of Indian and China in terms of economic growth and geostrategic, regional clout. These instances are indicative of the intense rivalry and competition that exists among these emerging nations, even as they continue to foster their economic relations through boosting of trade volume.

The Economy

While the West struggled to cope with a devastating financial crisis, China’s economy showed little signs of slowing down. To be fair, the Chinese were affected by the crisis as export demand slowed down, and legions of workers in the world’s factory lost their jobs. Nonetheless, as developed economies shrank in various quarters from late 2008 to mid-2009, China grew by an astounding 8.9% – so momentous, that there was talk of quickly reining in the Government’s stimulus packages. China’s strong productivity growth, augmented by a manufacturing sector, had opened up after market reforms in the late seventies, and since then, has not looked back. Despite fears being cast on a regular basis about the collapse of an overheated economy, China has grown by leaps and bounds to be the world’s third largest. Perhaps its impact on the global financial scene can be summed up the fact that nearly half of the U.S. Treasury bonds are held in China, and amounts to trillions of dollars. If China were to pull the plug today, several economies would feel the ground shake beneath their feet.

However, the Chinese dragon faces stiff competition from the Indian tiger – the impact of the credit crunch was mitigated by the conservative banking system in India, and the country’s diverse public sector. Arguably, India’s services-run economy fared better than China, as the latter’s heavy reliance on export demand and foreign investment fell by a considerable margin. Notwithstanding a high rate of unemployment and significant swathes of population living below poverty line, it is certain that the Indian economy will be a force to reckon with in the years to come.

(To be continued..)

Image courtesy Chinadaily.com

(This article forms the second post in the Teach-Yourself-Indo-China-Relations-Kit series.)

Differences between New Delhi and Beijing have a historical nexus to border disputes and skirmishes spread over half a century. Consequently, any analysis of extant relations is illuminated by the problems that have cropped up along the 4000 km-long Line of Actual control demarcating the Sino-Indian territories.

Indo-China relations started on a good footing after India’s Independence, with the establishment of diplomatic connections and recognition of the Panchsheel principles. While the Indian establishment had been taken aback by the swift and largely unexpected Chinese invasion of Tibet, India’s foreign policy, guided by Nehru, chose to overlook Chinese interests in the region. However, relations soured in later years over disputed claims to Aksai Chin, and India’s asylum to the Dalai Lama, which culminated in the Sino-Indian war of 1962.

For decades, the war of 1962 shaped the contours of bilateral relations, marked by frequent skirmishes along the border and cartographic differences vis-à-vis disputed territories.  Nonetheless, concessions have been made in recent times, with reference to some areas. During former Indian Prime Minister Vajpayee’s Beijing visit, both countries issued a joint statement, acknowledging that the Tibet Autonomous Region is a ‘part of’ the territory of the People’s Republic of China. In response, China agreed to initiate border trade with India through the ‘north-east State’ of Sikkim, and has removed the region from its index of ‘independent nations’ in Asia. The McMahon line continues to present a number of complications, with the Chinese refusing to accept the Simla Accord of 1914. Arunachal Pradesh, formerly the North East Frontier Agency, remains a bone of contention between both countries, with India firmly dispelling any Chinese claims to the State. Of late, the Chinese practice of granting stapled paper visas to residents of Kashmir has also generated controversy, drawing strong reactions from the Indian side.

Yet, it is remarkable that China has settled all (land) border differences with twelve of its fourteen neighbours, including ideologically-driven, complicated ones with smaller nations such as Vietnam. The two nations still locked over territorial disputes with China are Bhutan, which has no diplomatic relations with the former, and India. Given the potential benefits vis-à-vis regional stability and economic development that would accrue from a peaceful settlement, it is difficult to gauge why China has not accorded priority to solutions on the Line of Actual Control.

Perhaps, it has. In fact, the delay in boundary settlement has often been viewed as a deliberate tactic, employed by China to exert pressure on Indian influence in the region. If such dispositions were correct, the circle of Sino-Indian relations would have reached a juncture where territorial interests are no longer the primary objective of their mutual foreign policy – rather, it is the geopolitical and strategic concerns that drive border conflicts.

(Continued)

Image courtesy The Hindu.

The-Teach-Yourself-Indo-China-Relations-Kit – I

Posted by Arun On January - 1 - 2010

… [China’s] summit with [India]….. brings together the leaders of more than a third of humanity and of the two countries whose growth is the starting-point for all serious discussion of the global economy in the 21st century. Few bilateral relationships are more important than this. This one matters to us all.

- ‘Rivals in Partnership’, The Guardian, November 22, 2006.

The term ‘South Asia’ only found its way twice into the recent Sino-U.S. Joint Statement issued during President Obama’s trip to Beijing – but it was enough to ruffle feathers on the other side of the Himalayas, and many Indians viewed the reference as an interventionist move by China to meddle in sensitive issues of the sub-continent. The controversy surrounding the Joint Statement was just another incident in the long string of seemingly hostile strategies, press releases and communiqués that have characterized Indo-China ties in the past few months. Contentious border problems have come to the forefront, and hawkish media entities and political circles in both countries have predicted an inevitable war. Yet, it is easy to forget amidst all the uproar that China has emerged as India’s largest trading partner since 2008 and its volume between these emerging giants is well on course to reach $60 billion by 2010. Their mammoth economies have extensively co-operated in leading the world out of the global financial crisis, and both nations acknowledge the value of their commercial relationship. What, then, explains the growing tensions between India and China as these powerhouses remained locked in a curious relationship that befuddles analysts and policy makers alike?

This piece, divided into 5 parts, examines the paradigm shift in relations between India and China that has influenced their bilateral relationship in recent years. While the Sino-Indian discourse had hitherto focused on the territorial space, it is being increasingly defined by emergence in economic growth and strategic regional clout. To this extent, as is noted later, it would not be improper to state that these ‘new’ factors in Indo-China relations have in fact, dictated the countries’ positions on borders, and territorial suzerainty.

(Image courtesy telegyaan.com)