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Modi’s China Visit – Some Straight Talk, Some Unreciprocated Concessions; By Bhaskar Roy

C3S Paper No. 0114/ 2015

Indian Prime Minsiter Narendra Modi ended his state visit to China with a flourish in Shanghai on May 16. The day marked the completion of one year of the BJP led NDA government in New Delhi, and Modi used it to the hilt, addressing a 5000 strong Indian diaspora in China who gathered in Shanghai. In his address to the students of the prestigious Shanghai Fudan University, Modi welcomed Chinese investment in India as an enabling factor in his “Make in India” initiative. In the course, Modi mentioned the need to remove the irritants between the two countries.

A list of 24 Agreements/MOUs totaling more than US $ 22 billion was also unveiled in Shanghai. This long list of deals range from railways to space including information Technology (IT) and power among other areas. MOUs are only shows of intent and not commitment.

While the Chinese Communist party and government brandish their economy as market economy, in reality it still remains a command structure. There is a political decision behind foreign investment as well as in absorbing FDI. If the Chinese authorities have decided to go ahead for political reasons, investments in areas like infrastructure will come in. Chinese telecom companies like Huawei and ZTE have held on to their ground in India since their role is more than just business. They are Chinese strategic assets. Ali Baba and Xiomi are in to take over the Indian mobile handset market. Both Huawei and ZTE have serious questions hanging over their activities in many western countries.

Nevertheless, if India is seeking direct investment from China then doors have to be opened wider. But caution must be the watch word and strategic areas will have to be protected. Views of Indian intelligence and security agencies should not be brushed aside altogether, and lessons must be learnt from other countries. The US has estimated it loses US $ 300 billion annually in innovation and intellectual property to Chinese hacking and espionage. Having Chinese companies in India’s critical and strategic infrastructure is a risk that needs to be weighed carefully.

Instruments of the Chinese communist party have long mastered the art of studying interlocutors and devising ways to please them. Much has been made of President Xi Jinping coming to Xian to receive Prime Minister Modi. It was the first time that a Chinese president came out of Beijing to receive a foreign dignitary.

A close look will reveal it was a reciprocal gesture. Modi received Xi last September in Ahmedabad, his home state. Chinese are sticklers for diplomatic protocol. They replicated what the Indians did for them with warmth and fanfare. If the Chinese did not do so it would have been a diplomatic snub to India, and would have brought the relationship crashing down. China just cannot afford to do this at this juncture. There is too much at stake. It has created an atmosphere of tension in the East China Sea and South China Sea with neighbours over territorial issues. It is also creating a structure to counter the US pivot in Asia. And India is too important a country to be drawn into an adversarial relationship. Hence, it finds downloading its excess capacity in infrastructure building in India opportune.

China decided against officially queering the pitch before Modi’s visit, something which it did just before Premier Li Keqiang’s visit to India in 2013 and during Xi’s visit in September 2014. There were two major PLA incursions into Indian territory in the western sector on both occasions.  Neither of them were accidental or unilateral action by the People’s Liberation Army (PLA), as some in India tend to believe. The western sector comes under China’s Lanzou Military Region, and no officer from this MR was “disciplined”. By those two intrusions China made an emphatic statement that there was no compromise from the Chinese side on the border issue.

But just before Modi’s visit, the Communist Party run Global Times accused Modi of “playing tricks” over the border issue, and demanded that to promote trust Modi refrain form visiting disputed areas (referring to Modi’s visit to Arunachal Pradesh which drew an unusually sharp reaction from China). The article also emphasized that India should completely stop supporting the Dalai Lama and stop making the Tibet issue a stumbling block to the Sino-Indian relationship. It clearly conveyed China was no longer satisfied with the Indian position on the Dalai Lama and the Tibetan issue.

The official Chinese news agency Xinhua (May 16), however, struck a more balanced and cordial note, avoiding the irritants in bilateral relations. This is the Chinese way of wielding a stick in one hand and carrot in the other. Some tend to dismiss the Global Times as a tabloid. But this English Language newspaper, a subsidiary of the Party mouthpiece, the People’s Daily, was created for this purpose. For conveying messages but leaving space for denial officially. A fundamental  rule that interlocutors should be aware of, is that the Chinese always leave a door open for themselves to withdraw, if the need arises.

The Joint Statement issued between Prime Minister Modi and Premier Li Keqiang was far from exciting. The glamour was in Xian, highlighting ancient connections between the two countries, and the Daichi – Yoga display in Beijing and the like. Although the Joint Statement touched on several points of issues between the two countries, overall it was cautious and no independent points were made. This, of course, is understandable given the fact that the two sides are still feeling out each other. Of note, however, was the recognition that mutual trust be generated, military ties be enhanced, peace and tranquility along the borders be maintained, with hot lines to be established between the two militaries, relations not be made hostage to the border issue and, cooperation be present in counter-terrorism and a host of other things.

Glimpses of the meat of the political interactions were seen in Modi’s press statement after his meeting with Li Keqiang on May 15 in Beijing. He reminded the Chinese that the full potential of the bilateral relationship could be realized only when the Chinese took a “strategic and long term view” of the policies that impeded actions on further improving the relationship. He not only reiterated confidence building measures but also the importance of clarifying the Line of Actual Control (LAC) on the border. This was a strong statement and a departure from the past practice of brushing under the carpet such positions in public. Last year, Modi had told Xi in New Delhi that bilateral relationship would depend on the situation on the border.

Modi also reminded the Chinese of the threat from terrorism to both countries and that instability in West Asia mattered to both. In a loaded statement which has deep meaning for India’s security and that of the region he said “peace and progress in Afghanistan benefits us both”. Modi  also did not hesitate to say that relationship between the two countries “has been complex in recent decades”.

The border issue remains the most intractable problem between the two countries. It is true that some perceptible, even if slow, progress has been made since the Special Representative level talks started. Prime Minister Rajiv Gandhi’s visit to China in 1988 and the Peace and Tranquility (P&T) Treaty signed in 1993 during Prime Minister Narasimha Rao’s visit ensured a peaceful border. The 2005 agreement on the guiding principles and political parameters for the border settlement have taken the process forward. Further Confidence Building Measures (CBMs) have been added on the border. But that is where things stand.

There are no indications to suggest that China is willing to move beyond the stability on the border. They are uncomfortable with the clause in the 2005 agreement which says there will be no transfer/exchange of territory with settled population, which put Tawang and Arunachal Pradesh beyond their negotiating agreement.

In fact, China seems to have hardened its position both in the Eastern and Western sectors. For their own compulsions they require a stable environment and they have largely achieved this through the CBMs, to which more things can be added.

China will come to a conclusion only when it suits them strategically. A study of the Sino-Soviet boundary negotiations will reveal that only after the Soviet Union collapsed and Russia became weak, presenting a Sino-Russian alliance against the US and the West that the border issue was finally  resolved.

Form China’s perspective the Sino-Indian relations and the border issue are linked to the issue of the Dalai Lama’s residence in India and the Tibet issue. India tried to appease China by signing on the dotted lines presented by the Chinese on the status of Tibet in 2003, during Prime Ministjer Atal Behari Vajpayee’s visit to China. India got nothing in return.

The Dalai Lama and the Tibetans in Tibet are seen as a challenge by Xi Jinping. A very hard line has been adopted, even bringing the communist Party into the monasteries. Beijing is in a dilemma on how to deal with the Dalai Lama and whether his demise without a solution of the Tibet issue will make things easier or more difficult for the Chinese authorities.

Moreover, the views among the Chinese people and even some officials are changing about the Dalai Lama and the Chinese policy in Tibet. This is an uncomfortable development for the authorities in Beijing.

China has gone all out to isolate the Dalai Lama internationally. Now they are contemplating putting pressure on India to isolate the Dalai Lama inside the country. New Delhi must prepare for such an eventuality. For a large majority of Indians the Dalai Lama is not a political tool but a part of Indian culture and spirituality. There can be no compromise on this issue.

Very little or nothing has come from the Chinese on the issue of Kashmir, Pakistan or terrorism. Showing a truncated map of India without Jammu and Kashmir on the Chinese Central Television (CCTV) speaks for itself. Modi protested over Chinese infrastructure constructions in Pakistan occupied Kashmir (POK), a disputed territory claimed by India as its sovereign territory. China demonstrated that it has two policies on disputed territories – one for itself and one for others like India. China opposed an Asian Development Bank (ADB) loan for infrastructure development in Arunachal Pradesh on grounds it was disputed territory!

While seeking cooperation with India it is strengthening Pakistan militarily, (pointedly aimed at India). China’s supply of nuclear weapons and missile technology and systems to Pakistan is well known. It is a major case of nuclear proliferation and is continuing to this day, while arguing overtly for non-proliferation. China helped test Pakistan’s first nuclear bomb in its test site in Taklamakan desert.

There is, however, scope for cooperation in counter- terrorism. This, only if China accepts that Pakistan raised and sponsored terrorist groups like LET and Jaish-e-Mohammad and recognizes Hafiz Saeed as the mentor of LET. China remained silent about the Mumbai terrorist attack of 2008, and has not made amends. China is only concerned about the Uighur separatists, the ETIM. It is China’s call to prove that they are serious about counter-terrorism and not play favorites with terrorists who target India.

Modi was right in flagging India’s list of concerns. This extends to international issues which directly impinge on India’s strategic interests like membership of the Nuclear Suppliers Group (NSG) and India’s membership in the UN Security Council.

Modi went an extra mile, opening electronic visas to Chinese. He was looking at increasing people-to-people contact between the two  countries and tourism revenue. Swarms of Chinese coming into India has its security implications. The Chinese have not assured proper visas to Indian citizens from Arunachal Pradesh. The balance does not match up.

China’s foreign policy may not have undergone a revolution, yet, but they are revealing aspects of their foreign policy emboldened by their new found economic and military power. Only their diplomatic influence has failed to match up, and they have to address the same.

Xi Jinping made it clear at the November, 2014 foreign policy conference that China was striving for the preeminent position in Asia, and they must pursue it forcefully. Military muscle has been added to its foreign policy pursuit.

The United States remains at the top of China’s foreign policy, seeking a balance with Washington. In the meanwhile, the new Silk Belt and Maritime Silk Road (One Belt, One Road), backed by Chinese funding of US $ 40 billion is aimed at creating an united front to counter the US. There is also a parallel strategy to firmly establish itself in the Indian Ocean.

China has not denied that it is in the process of establishing a naval base in Obock, Djibouti, overlooking the Bab-el-Mandeb strait, one of the busiest shipping lanes that leads to the Red Sea and on to the Mediterranean through the Suez. Djiboutian president Ismail Omar Guellets confirmed to Duowei News, a US based Chinese news outlet, that negotiations are on.

Seychelles had reportedly invited China in 2011 to set up a military base, though the Chinese Defense ministry said it would be used as a supply base for ships and to fight piracy. Other African countries are also said to be in Chinese consideration.

The critical base, of course, is the Gwadar port in Pakistan overlooking the strait of Hormuz. A supplementary facility in consideration is the Hambantota port in Sri Lanka. After failing in Myanmar, China may be looking at Bangladesh as a potential supply base, with the Bangladesh-China-Myanmar-India (BCIM) road connectivity. China has bid to build a deep sea port in Paira, Bangladesh.

China is yet to propose officially to India to join the Maritime Silk Road, but is feeling out the Indian thinking.

India has to walk cautiously. As Modi told the Chinese, Indian concerns must be addressed positively to achieve the full potential of the relationship.

There is a bottom line, however. India and China are the two largest countries in Asia, sharing a long though contentious land border. Geography is a permanent feature. Both will have to work together if the Asia of the 21st century is to be realized.

(Note: The writer is a New Delhi based strategic analyst.  He can be reached at e-mail

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