BY Sumedh Lokhande
Something important is happening in Asia which the whole world is watching with eagerness and anxiety. The two most populous countries of the world have started their march towards the core of the international economic system and seem to be marching at a fair speed. It may be early into the present century but there are unmistakable allusions by various Think Tanks all over the world that the current century is going to be shaped largely by the actions of these two Asian giants.
India-China declared 2012 as the year of India-China friendship and co-operation. High-level mutual visits, agenda for cooperation in a number of areas, burgeoning trade and investments, multilateral cooperation marked the positive direction in bilateral relations even as some core national interests continued to bog down the relations between the two countries. Their relation has travelled a long way from a position of conflict to being major collaborators in some aspect of their bilateral engagements in the last 60 years. The question is how to explain this relationship between India-China? Does this relationship gives us allusions of cooperation or is just an illusion and how long it will last? In this article I have tried to study the points of convergence of interest and the potential of rift between the two Asian giants in future.
Potentials of cooperation
Border trade connectivity
India and China are said to cooperate in bilateral trade through their land borders under Bangladesh China India Myanmar regional forum (BCIM) established since 1999. China in the long run looks at it as a vital physical economic entry into 1.3 billion people market of South Asia; whereas for India it will open access to other business centers in the western, eastern and south-eastern China which will help in developing its northeastern region.
The border trade between India and China is conducted along three mountain corridors Gunji in Uttarakhand, Namgiya Shipkila in Himachal Pradesh and Nathu La in Sikkim. Beside trade this connectivity can also help to promote tourism in this region. Sikkim connects the major Buddhist destination in India and its neighbouring countries Bodh Gaya, Rumtek, Tawang in India Lumbini in Nepal and Taktsang in Bhutan to Jokhang and Potala in Lhasa. The Nathu la trade route, if opened to tourist traffic, could integrated the tourism industry of Himalayan states in the north-east and other regions with similar features in the neighbouring countries like China, Bangladesh, Bhutan, Myanmar and Nepal.
The Chinese central government has set a high priority on the resumption of trade through India trough sub regional arrangement along with Bangladesh and Myanmar as it will play a major role in developing in southern Tibet region and south western Yunnan province. Further China will have easy access to the ports of West Bengal and Bangladesh through which it can trade its goods directly to its western region as the distance between Lhasa, Tibet and Gangtok, Sikkim is roughly 590 kms.
But India is reluctant to commit itself to this initiative. My contention is that the reason why India chooses to go slow and remain cautious about this sub regional arrangement with China is directly related to a non-economic issue, namely, the intermittent flare-ups on border issue and China’s claim over Arunachal. Further, India also apprehends economic trouble as it will further help China in dumping its goods in India. As a result, despite several visits by trade, development and investment officials from Yunnan Province hardly US $ 1.125 million worth of goods were exported and imported through border trade in 2012.
Cooperation in Climate Change
India and China have emerged as defenders of the global South in the international climate change arena which has been polarized into a North versus south negotiation. The climate change debate today is centered on whose responsibility it is to clean up and protect the environment. For years, India and China have presented a united front in various international negations and agreements. Both nations have asked developed nations to slash their carbon output and at the same time have refused to accept the cap on their carbon emission as it will hurt their growth.
In 2009 they made it official and signed a Memorandum of Understanding (MoU) for exchange of views on energy conservation and efficiency, to increase cooperation in renewable energy and forest management, to deepen mutual understanding, and strengthen coordination by enhancing cooperation.
The economic and social benefits of cooperation in Climate change could be huge for both countries as they both are in search of renewable source of energy as it will reduce their burden of importing large resources of oil, natural gas and coal and will also reduce their carbon emission without hurting their growth. Take for instance Government of India wants India to emerge as a global leader in solar power generation. It not only has a Ministry of New and renewable Energy, but has also set-up the Jawaharlal Nehru National Solar mission and is providing capital subsidies, for solar power generation. On the other hand China’s ambition is to become a major player in solar industry, and have already managed to reduce the price of their solar panels by 75% over their US counterparts. As a result China could be strategic partner for India in achieving its dream of generation 20, 000 megawatts of grid-connected solar power by 2022 under its Jawaharlal Nehru National Solar Mission.
Energy Sector cooperation and competition
According to World Energy Outlook in 2030 the world’s energy needs would be well over 50% higher than today. China and India together alone will account for 45% of the increase in global primary energy demand in this scenario.
Today China has already surpassed USA in terms of energy consumption and continues to import increasingly large quantities of energy to support its rapidly growing economy. India promotes itself as a major importer of energy from all possible sources and has emerged as a major energy market in the world. In short,increasing energy consumption is making it a necessary condition for them to cooperate, seeing it as their common interest to sustain their growth. Are they, really cooperating? The two countries collaborated in four cases, viz., Sudan, Syria, Iran and Colombia. In Sudan (March 2003), India paid $750 million for 25% of oil share while the Chinese company CNPC paid $441 million for 37%. In Iran (September 2006), India got only 29% shares while China got 51%. Further China has successfully out bid India in four other oil fields Angola, Kazakhstan, Ecuador and Nigeria and India is collaborating with other nations to compete with China e.g. India-Vietnam joint oil exploration.
It is clear that, even while cooperating in energy sector they are competing with each other; here China has upper hand over India due to its vast economic resources.
In the Following video Venu Rajamony a Senior Indian Diplomat talks about challenges and opportunity for India in energy security.
Potential of dissonance
The dams on Brahmaputra River
Despite a well-functioned relationship between India and China in recent decades, the Brahmaputra River may pose new challenge to the continued supply of fresh water for both countries in the future. China is constructing a major 510 MW hydro-power dam on the Brahmaputra River. This project in Zangmu in the Tibet Autonomous region (TAR) began to be built in 2010 and is expected to be complete in 2015. When India rose concern over this dam China assured that the Dam is a small project which will not have any impact on the river’s downstream flow into north-east India. But this year in January China has given nod for three new dams on the Brahmaputra river and one of the three approved new dams is bigger than the Zangmu Project.
A 640 MW dam will be built in Dagu, Which lies 18 km upstream of Zangum. Another 320 MW dam will be built at Jiacha, and the third dam will be built at Jiexu, 11 Km upstream of Zangmu.
This has alarmed Indian side as it can have a major impact on ecological system of India’s north eastern region and once the dams are completed, the control on the water of Brahmaputra will be in the hands of China. If China blocks the water in Brahmaputra it will lead to famine in Northeastern region of India. Further, the dams will block the flow of minerals through water and block the fish migration. All this will adversely affect the ecology and led to environmental imbalance of this region.
There are also reports suggesting that China in the long run wants to divert this water towards its northern and eastern region. However, with the three new approvals under the energy plan, four hydropower projects will now be built- on the main stream of the middle reach of the Brahmaputra which are enough to increase India’s water crisis in near and midterm future.
As a result its high time that India takes this issue seriously as it could be too late very soon.
India and China -Pakistan relations
From the very beginning, China has been projected the threat factor that could push India to cross the nuclear threshold. Further China has assisted Pakistan to lay hands on nuclear weapons. Today Nearly 70% of Pakistani battle tanks and 50% of combat aircraft are of Chinese origin. Since the beginning of this century, China has embarked upon massive modernization of its armed forces. This Chinese modernization programme forces India to pursue an effective deterrence programme. According to an Indian intelligence report China has at least 25 nuclear-tipped medium-range ballistic missiles based in Tibet, along with an undisclosed number of nuclear-configured short-range tactical missiles. These deployments are singularly India-specific as they have the range to strike major Indian cities or engage military formations in the Himalayas.
Given the gap in the conventional military capabilities between the two countries, it has become imperative for India to build credible deterrence with nuclear weapons. For instance India’s Agni 5 Nuclear Missile has created deterrence as it can hit all major Chinese cities including Shanghai and Beijing.
Following video gives us Chinese perspective on Agni 5
Although China views USA as its main strategic rival in Asia-Pacific region, it has actively sought to contain India by providing nuclear weapons capabilities to Pakistan. The current two Pakistani nuclear reactors Chashma 1 and Chashma 2 are Chinese made. China has also provided nuclear weapons technology to Pakistan, for e.g. it traded ring magnets used to produce enriched uranium for missiles in the 1990s. China and Pakistan reached a formal agreement last month to construct a third nuclear reactor in the northern province of Punjab. The secret agreement for the Chashma3 reactor was signed in Beijing which calls for the state- run China National Nuclear Corp (CNNC) to construct a 1,000 megawatt power plant at Chasma.
Further India has a long term ambition to join the Nuclear Suppliers Group NSG, but China is opposing the move and instead supporting Pakistan for the same. This all-weather friendship between China and Pakistan can cause an India China conflict; e.g. after the2008 attacks in Mumbai a senior Chinese leader gave an on record statement that if India attacks Pakistan it will annex Arunachal Pradesh as southern Tibet.
India China and the big fight in Indian Ocean
Both, India and China, seeking to develop economically rapidly need abundant and regular supply of many resources. China’s oil consumption doubled between 1995 and 2005, and it is estimated that it will grow even faster between 2005 and 2015 surpassing US consumption. As a result its demand for oil and gas will keep on increasing. Similarly, India’s energy consumption accounts for about 3.5% of the world; making it the fifth largest consumer, with its ever increasing population and its desire to become a superpower will force it to increase its primary energy supply by at least 3 to 4 times and its electricity generation capacity by 5 to 6 times by 2031.
Today, nearly 80 % of Chinese trade, particularly oil, and 97% of India’s trade are through the sea lanes of Indian Ocean. Beside this two-third of world’s oil trade and one-third of bulk cargo is carried through this region. India considers Indian Ocean as its own lake and justifies its legitimacy in these waters. On the other hand, increasing economic interest and the need to protect its trade lanes in this region has made China increase its naval presence. For this purpose China has collaborated and developed sea ports in a number of littoral states surrounding India. These ports can be used both for civil and military purposes.
This strategy is popularly known as String of Pearls, which India feels is to keep India boxed within South Asia and contain its Influence over Indian Ocean.
India has tried to counter balance this strategy with its so called Necklace of diamond. Under this strategy, it is building military relations with key countries in the Indian and Pacific Ocean with Australia, Indonesia, Vietnam, Japan, with our neighbouring countries in South Asia along the Chinese trade lanes. Last year India commissioned NAS Baaz, India’s first naval air station at Campbell Bay, the southernmost island of the Andaman and Nicobar group of Islands. This will enhance its surveillance capacity not only in the Straits of Malacca but also the Straits of Sunda and Lombok.
If one closely looks at the region stretching from Indonesia to Japan it resembles a necklace with Australia as its diamond. Further it has also developed relations with the gulf countries particularly Iran where it has invested in developing Chabahar port to counter China’s Gwadar port in Pakistan.
The above scenario makes it clear that Indian Ocean is one core area of divergence, if not conflict, as China which is not an Indian Ocean Power is investing a lot of diplomatic and military power to become one. On the other hand, India which is not a South or East China Sea power, is working hard to project itself as one of the main power by developing relations with littoral nations in this region. One can say that this is the crux of India China Strategic rivalry. These are important ponderings because the shape of the twenty-first century international system depends largely on the future juxtaposition of these two countries
The recent interactions between India and China in the last one decade indicate moves toward normalistaion of ties on certain issues such as bilateral trade, climate change etc. and yet stalemate on certain issues such as border dispute, defense ties etc. India is also not entirely comfortable with directly engaging China within any multilateral arrangement, wherein India may be a lesser player vis-à-vis China. The New Chinese President Xi Jinping has assured India that China would pay “great importance” to developing bilateral ties and expects to carry out close cooperation with India to create a brighter future of their bilateral trade. At the same time he also had given the nod to develop Chashma 3 nuclear reactor for Pakistan which is said to be India centric. As a result India should look at these developments with caution as there is a saying in international diplomacy: Watch what countries do, rather than what they say.
Further since India and China share the same neighbourhood similar compulsions and similar self-perceptions they are bound to compete directly and also over the neighbourhood in all matters, most important among them being security in the future to come. For the time being they are trying to avoid direct confrontation, demonstrating commitment to cooperation and friendly relations.
21. Pramod Kumar, “Asian Maritime Diplomacy: an Economic Analysis”, World Focus, January 2013.
22. ArunodayBajpai, “India’s Maritime Strategy: Challenges and Response”, World Focus, January 2013.