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Indian Prime Minister’s Visit to China – Jan 2008

A lot has already been written and said in the print and electronic media about Prime Minister Manmohan Singh’s three-day visit to China from 13 to 15 January 2008. It is therefore not necessary for me to take your time by summarizing all that reporting.

Normally, I am an optimist concerning India-China relations; but I have decided to march to a different beat today. There are many valid reasons for my decision to function like the Devil’s Advocate and I will list only the most important ones. It is tiring (or do I dare say, boring) to remain for ever an optimist when such optimism is not matched by reality for a long time. Secondly, I feel that a reduction in the rosy tint of my glasses may result in a more meaningful discussion in this group. Thirdly, so much apparently misplaced euphoria about the visit has been generated by media and political hype that there seems to be a need to let out some of the hot air and bring the balloon closer to the ground.

Achievements

Please let us look clinically at the various “achievements” claimed for the visit by the “spin” put out by Chinese and Indian officials and media.

Qin Gang, spokesman of the Chinese Foreign Ministry told reporters on 15 January (after the PM’s meeting with President Hu Jintao) that the visit will have ”long-term and significant” impact on the bilateral relations between India and China. He said that ”The time is not long, but the content is rich”. The spokesman described the documents and MOUs (for cooperation in different fields) signed during the visit as a ”milestone,” and ‘a signal of the big step forward in the history of bilateral relations’. He added that “The ‘Shared Vision for 21st Century”, a joint document signed by the two countries, ”is a message to the outside world that the two sides will intensify their cooperation to build a harmonious world”. The visit and talks were a ”reflection of the political will” of both sides to ”press ahead” with their bilateral ties. India and China view their ties from a strategic and long term perspective. In response to a question, Qin Gang said “India is a major developing country. China understands and supports the aspirations of India to play a larger role in international organisations, including UN”. ”China is willing to see improvement of relations between India and Pakistan and China will be happy to see stability and peace in South Asia” I am disturbingly and vaguely reminded of the “patronising” attitude that Jawaharlal Nehru displayed towards Zhou Enlai at Bandung, more than fifty years ago, and the resultant Chinese resentment.

Factually, the following documents were signed on 14 January 2008.

A Shared Vision for the 21st Century.

Memoranda of Understanding

  1. Cooperation between the Planning Commission of India and National Development and Reform Commission of the Peoples Republic of China.

  2. Cooperation between the two Ministries of Railways.

  3. Cooperation between Ministry of Housing and Urban Poverty Alleviation of India and Ministry of Construction, PRC.

  4. Between the Ministry of Rural Development of the Republic of India and the Ministry of Land Resources of the PRC.

  5. Between Indian Council for Cultural Relations and Chinese People’s Association for Friendship with Foreign Countries on India-China Joint Medical Mission.

  6. Between the Indian Council for Cultural Relations and Chinese People’s Association for Friendship with Foreign Countries on Cooperation in Culture.

  7. Cooperation between Geological Survey of India and China Geological Survey.

  8. Between Department of AYUSH, Ministry of Health and Family Welfare and State Administration of Traditional Chinese Medicine (SATCM), PRC.

  9. Between NABARD and Agricultural Development Bank of China.

  10. Protocol of Phytosanitary Requirements for the Export of Tobacco Leaves from India to China, between the General Administration of Quality Supervision, Inspection and Quarantine of the People’s Republic of China and the Ministry of Agriculture of the Republic of India.

According to my (perhaps faulty) understanding of diplomatic jargon, treaties and agreements are signed by countries when they agree on all related matters concerning an issue, and normally involve certain agreed restrictions on the exercise of full sovereignty on those matters. Treaties are more sacrosanct than agreements and, in many countries, involve also the legislative wing; and they are normally registered with the UN. Agreements are generally more easily amended or abrogated and hence are not as “binding” as treaties. When the levels of understanding are less, and when more flexibility is considered necessary in the implementation, countries sign memoranda of understanding. In cases where the countries want to make a statement, but do not want to be bound by what is stated, they resort to the issue of declarations – with most areas left open for further discussion and negotiation. In the rare instances when the agreed positions do not warrant even a “declaration”, but the countries want to convince themselves and the rest of the world that they have many shared interests and concerns about which they are not ready to make any binding commitments, they issue a “Vision Satement”. B.S.Raghavan has written an excellent piece bringing out how nothing really new has been said either by India or by China. (The India-China ‘vision thing’, by B.S.Raghavan, Business Line, January 18, 2008) He has, perhaps a little uncharitably, said that “It is all a candy floss of bloated sugar-coated verbiage which makes little difference to realpolitik as practised by countries.” Further, the operative MOUs signed on 14 January really have nothing to do with the talks and discussions during the PM’s visit. Such MOUs are carefully negotiated and finalized over a period of time; and kept ready to be signed at an appropriate media opportunity.

Border Issue

The two Special Representatives (India’s National Security Adviser M K Narayanan and Chinese Vice Minister Dai Bingguo) met over lunch on 15 December. For the first time, they exchanged their versions of drafts on a possible framework agreement involving concessions from both sides, possibly leading to a permanent settlement of the boundary dispute. Though China has not given up its claim on Tawang, it is reported that both sides are willing to set Tawang issue aside for the moment and try to concentrate on areas where there is “least disagreement.” It has been stated that India is keen on holding a meeting of the expert group to look into the “clarification” of the Line of Actual Control, but Beijing is still not willing to accede to India’s long-standing demand for the exchange maps – probably because that may give the impression that the LAC could become a de jure boundary.

Prime Minister Manmohan Singh told the Indian media representatives that there were two drafts on the table. He also said that “Progress has been made, both President Hu Jintao and Premier Wen Jiabao assured me that they have the political will just as India has the political will to make the necessary decisions – the two Special Representatives have already set up a working group which is looking at the two alternative drafts of the framework which should ultimately emerge as an agreed framework. That process is on.” In the meantime, the two sides have agreed to maintain peace and tranquility on the boundary, an assurance which the PM said he got from both Hu and Wen.

The Chinese Foreign Office spokesman made the usual proforma statement about China favoring an “equitable and fair” solution to the boundary issue, in the overall interests of both the countries, adding that it should not be allowed to hamper progress in bilateral ties.

It seems to me that there has been very little forward movement on the border issue in the last fifty years. The conceptual differences relating to the alignment of the boundary have since extended to include the alignment of the LAC. The fifty years have seen the exchange of numerous letters, a short war, many rounds of talks at different levels, agreements on the maintenance of peace and tranquility along the border and some confidence building measures. However, the basic issue continues to evade an agreement.

I would seek your indulgence and commit the sin of quoting myself. During an interaction in this forum (ORF-C) on 28 April 2007, I had stated :

“It is my personal opinion that there is an urgent need to take these talks to a new dimension. It might be useful if the Special Representatives could be authorised by their principals to look beyond the issue of sovereignty and quickly evolve a practical solution. They may then be able to place the settlement of the issue of sovereignty over the “disputed” areas on the back burner (perhaps for a very long time) and go ahead to work out an agreement on a practical “administrative boundary” between the two countries. The fact that this concept may not have been tried before in international relations, through a treaty or an agreement, should not prevent the Special Representatives to start thinking outside the box. The issue of Tawang could probably be addressed by agreeing to set up a Joint India-China Peace and Friendship Centre there, with tourists and pilgrims from both countries having free access, subject only to infrastructural limitations. The Government of India may, of course, have to discuss any such “radical” idea with all the major political parties and arrive at a national consensus – in order to present to China a unified national position.”

There has been some support from an unlikely source. Prof. Yan Xuetong, Director of the Institute of International Studies at Tsinghua University, stated in Kochi on 22 January 2008 that “We cannot expect to improve the political relationship after settling the border dispute. As long as we improve our political relations, we can gradually move from freezing our border issue to settling our border issue”.

Ten months after my earlier suggestion, I feel that it can be refined. China may find it difficult to accept the word “boundary” in my suggestion for an agreement on a practical administrative boundary. At the same time, India should not be happy with continuing the terminology of Line of Actual Control, as it is not very different from a Cease Fire Line which is normally the bye-product of a continuing state of war or armed truce. Now that some movement has been made towards reconciling the different views about the actual alignment of the LAC, could not the leadership of both the countries instruct their Special Representatives to speed up the process of defining the line and name the resulting line as the “Agreed Line of Administrative Control”, pending an eventual permanent solution?

In this connection, I may be pardoned for dreaming and making a tongue-in-cheek suggestion to M.K.Narayanan and Dai Bingguo. Let them agree to pretend that they have had additional dozen or so numbered sessions when hardly any progress could be made (followed by the usual reiteration of good intentions) and then, in honour of the numerical milestone of the twenty-fifth meeting, announce the alignment of the “Agreed Line of Administrative Control”.

Military

The relations between the armed forces of India and China are being developed slowly and, as should be expected, cautiously. They would naturally be guided by the state of the bilateral political relations. Periodical exchanges of visits (at different levels) have been taking place. The first India-China joint anti-terror military exercise (“Hand-in-Hand, 2007”) was held at Kunming in the Yunnan province from 19 to 25 December 2007. It was not something unique, in the sense that China had held similar exercises with the armed forces of different countries on at least eight occasions since 2002. The exercise involved nearly a hundred troops from each of the two armies. The “People’s Daily” (26 December 2007) said: “Although some military and diplomatic observers said that the joint training is more symbolic than substantial, many acknowledged that the point is not the scale of the joint training or what specific anti-terrorism skills are involved. The point is that the soldiers on both sides are moving toward each other in a friendly way.” The comments of Chinese officials and non-governmental analysts also stressed the significance of the exercise in the larger context of State-to-State and military-to-military relations and not in the specific context of their political willingness to fight against terrorism jointly. Some Chinese military opinions have highlighted the significance of the exercise for further boosting the development of ‘strategic cooperative partnership’ between the two countries. It was agreed during the PM’s visit that one more similar exercise will be held in 2008.

Economic and Trade Relations

The figures for bilateral India-China trade (18 million USD in 1991, to 3 billion in 2000, to 13.66 billion in 2004, to 38.2 billion in 2007, and an anticipated 60 billion in 2010) indicate that bilateral economic activity (mostly in the non-governmental sectors) has far outstripped the progress in state-to-state relations. Chinese companies have been actively engaged in the Indian market and have contracted projects worth over 12 billion USD. Indian majors have set up a number of joint ventures or subsidiaries in China in the pharmaceutical and software sectors, among others.

It is significant that the Prime Minister was accompanied by a strong business delegation on his visit to China. The PM described the India-China Economic, Trade and Investment Summit on 14 January 2008, as a unique gathering of businesspersons representing the two most populous countries of the world and a testimony to the progress that business communities from both sides have made in working with each other. In his address, the PM highlighted that the two economies are becoming engines of economic growth and must use their natural and human resources, technology and capital for the common benefit of the region. He referred to the achievement of trade targets for 2008 and 2010 two years ahead of schedule and said that the two countries should now set more ambitious targets. The PM urged Indian business to vigorously pursue opportunities for expanding non-traditional items of export. Such efforts, when matched by greater market access for Indian goods in China, will help to bridge the rising trade deficit (presently about 10 billion USD). The PM recalled that the services sector accounts for more than 50% of India’s GDP and more than 40% of China’s GDP; and said that there are enormous opportunities for both India and China to expand trade in services, particularly in construction and engineering, education, entertainment, financial services, IT and IT enabled services, transport, tourism, and health. He added that the Governments of India and China will work together to remove administrative barriers and to simplify regulatory regimes in order to move forward in these areas.

The PM also called for the strengthening of the base of the economic cooperation through business alliances and collaboration in technology transfer and development. India seeks to promote bilateral investments in sectors such as petrochemicals, steel, healthcare, IT and automobiles. He suggested a three-pronged strategy for the chambers of industry and commerce of both countries to achieve these objectives. Firstly, they should jointly develop a strategic plan for the future so that you have a vision of the economic cooperation and a road map for its implementation. Secondly, they could develop profitable business models that factor in the complementarities and competitive strengths and the special needs of the large markets of the two countries. Lastly, they need to acquire insights into each other’s markets, business customs and management styles. He said that the two governments should also strive to create a level playing field by addressing issues as non-tariff barriers, IPR protection and market-related exchange rates.

The Prime Minister emphasized that economic cooperation has become a principal driver of the strategic and cooperative partnership between India and China, for peace and prosperity. Several bilateral understandings and agreements are already in place to address different sectoral aspects which impact on economic cooperation. India and China are working together to develop a habit of mutually advantageous cooperation..

If India-China economic, trade and investment relations have to move beyond the current take-off stage, India has to address Chinese concerns about non-tariff (often security-related) barriers, mainly in sectors like telecommunications, port development, civil aviation etc. It can be nobody’s case that security concerns should be brushed aside, but a pragmatic and non-paranoid approach would help a lot. The development of B2B (business-to-business) and B2C (business-to-customer) relations and the establishment of brand names of India in China and of China in India are issues to be addressed vigorously and jointly by Indian and Chinese business houses. They have done fairly well till now, without any significant governmental involvement, and should now consider vigorous steps to try and leap-frog to the next stage

General

It is perhaps unnecessary to repeat the potential of India and China jointly to have a significant say in international affairs, given the combined figures of population, GDPs, natural and human resources, entrepreneurial strengths etc. However, it has to be recognized that total synergy cannot be achieved, given also the potential of competitive and adversarial positions on many issues and in many areas of activity.

Though China may, for the moment, be inclined to keep aside contentious issues and maintain cordiality with India, she apparently feels that her own space in East Asia is being squeezed by India. China cannot ignore the possibility that India-US-Japan-Australia quartet may gradually evolve a strategy to restrict China in its own backyard; and may continue her efforts to change certain historical and cultural permanencies through clever polemics. It is for India to overcome Chinese apprehensions and to show that there is enough space in Asia, the fastest growing region in the world, peacefully to accommodate all its constituents.

There were many reports about the bonhomie, back-slapping and special gestures noticed during the visit. They all have their own place in the larger scheme of things, but only if followed up by both countries with bold, imaginative and innovative measures to remove or minimize mutual irritants and realize the full joint potential of the strengths of India and China. The optimum course may be to let economic and trade relations develop rapidly (and in proper balance) so that economic realities may compel the governments to take active and quick measures to improve political relations – leading to closer military relations and ultimately to a permanent border settlement.

[This paper was prepared by R.Swaminathan, former Special Secretary, DG (Security), Govt. of India, to lead off a discussion in Observer Research Foundation – Chennai, on 25 January 2008. He is also associated with the Chennai Centre for China Studies. He can be contacted at rsnathan@gmail.com]

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