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Roundtable Discussion on “Contemporary China Dynamics”

C3S Event Report No: 010/2019

The Chennai Centre for China Studies (C3S) organized a Roundtable Discussion on “Contemporary China Dynamics”, on April 22 2019. The event which was held at C3S, was led by Logan Morrow, Research Analyst at Gilder, Gagnon, Howe & Co., New York; and chaired by Cmde. R. S. Vasan, Director, C3S. One area of Ms. Morrow’s study is “Belt and Road Initiative (BRI) and the efforts underway to integrate and build connectivity across Asia”.

The Roundtable Discussion was subdivided into the following themes:

  1. Perceptions held by India’s regional parties on China

  2. The Renewable Energy Sector

  3. Spotlight on Young Minds of C3S and other youth programmes

Mr. Rajaram Muthukrishnan, Investor and Director, Voice Snap Services Pvt. Ltd, Chennai, Member, C3S, gave his views on “Perceptions held by regional parties towards China”. The speaker briefly described India’s federal structure of governance. Communist party leadership is seen in the states of India like Kerala, Tripura and West Bengal. The growth of communist ideologies in India had slowed down with the collapse of Soviet Union. The Prime Ministers of India since 1947 have tried to establish relations all over the world with a significant aim to foster better foreign relations. In fact, the efforts taken by Shri Narendra Modi during his tenure as the Chief Minister of Gujarat greatly improved the economy of the state by attracting a lot of Foreign Direct Investments. His vision to adopt the notion of “Speed, Skill and Scale” into the manufacturing zones of the state was heavily inspired from his visit to China. This helped India connect better with the South East Asian countries. The visits by Chandrababu Naidu gave impetus to the growth of Information Technology hub in then Andhra Pradesh. His vision in the 1990s and early 2000s was far sighted enough to create a coercive platform for development aided by technology. The impact of technology in education, agriculture doubled up the output. These are some of the initiatives taken by the Chief Ministers of a state in a country to connect with the rising powers of the world and establishing areas of convergence. A clear route map was also formed to tap in the diaspora hailing from various states and residing in the respective country, for the tech know-how and pooling of investments, thereby bridging relations between the countries. The speaker added that a leader’s personality plays a vital role in bringing about foreign policy initiatives and the party agenda has very less role in it.

On another note, the Western hegemonic ambitions are now facing stiff competition from the hegemonic ambitions of China. The loans provided are disguised debts by the Chinese corporates to fund the Chinese projects. The moves by China are seen in an analogy to the East Indian Company’s ambitions. Africa is earmarked by China for its raw material supply while Latin America is seen as crucial for energy supply. Chinese finance is focused to diminish the demand for Western finance.

According to the speaker, while China is seen to exploit the trading partner/BRI countries for its own benefit, the Indian approach is seen to provide a win-win situation. The Indian government intervenes less in the business deals between its cooperates and other countries unlike China. These are some of the reasons stated as to why India does not aspire to become a part of an initiative that impinges on the growth and sovereignty of nations around the world.

The International Solar Alliance is seen as a significant move by India to tackle climate change by stressing on the need to employ solar panels for energy rather than depending solely on non-renewable resources.

Mr. K. Subramanian, Former Joint Secretary (Retd.), Ministry of Finance, Government of India; Treasurer, C3S, stated that a Chinese standpoint on changing the ground rules of globalization is necessary in bringing down the heavy influence of Western hegemony. The globalization initiatives by USA played a role in bringing about developments in the post-colonial era in developing countries. But beyond a certain level, it seemed like the US started enforcing its dominance instead of serving as an aid to growth in the developing countries. In order to balance the power in the global order and to bring about fair play in the global sphere, the role of China by setting up AIIB and other alternate loan mechanisms is commendable. The speaker also mentioned that G-20’s stage is set only with China’s presence. This states the importance of China in international politics. Moreover, the cloud storage platforms of USA hold immense data of the world which poses a serious security threat.

The BRI can be seen as a challenging factor to Alfred Mahan’s Sea Power dominance of world power. The World Bank capital assistance is not enough to aid the burgeoning need of infrastructure development in the developing countries.

Ms. Raakhee Suryaprakash, Chief Programming Officer, Red Elephant Foundation; Founder-Director, ‘Sunshine Millennium’; Associate Member, C3S, shared views on environmental aspects viz. China. China is aiming to sell products and technology to countries where the social environment cannot adapt the production technology. For instance, Africa can supply its demands with solar technology. There is less need for Africa to adapt coal technology. The projects of BRI are seen to exploit the natural resources thereby creating an impact on the environment. On hearing these pleas from the world countries, the Overseas Chinese Commercial Bank decided to not fund coal power stations anymore.

The Barefoot College in Tilonia, Rajasthan stands as an example to show how technology can be taught to people with no educational background and that it need not be sold to them.

Commodore R. S. Vasan IN (Retd.), Director, C3S, underlined that the China Pakistan Economic Corridor (CPEC), a flagship programme of the BRI is considered as crucial by China given CPEC’s advantage of providing access to the Arabian Sea. Moreover infrastructure development projects planned by China in Pakistan result in heavy environmental degradation. Earlier, 1-3% of coal was used in Pakistan, now about 49% of coal is being used in Pakistan. This is known to benefit China more than Pakistan. The speaker held the view that China, with its aim to maintain double-digit export growth is looking for raw materials and by using its debt trap mechanism would turn the countries supplying raw materials into markets for finished products. The infrastructure projects led by China in BRI countries can be a burden on the recipient nation, such as the Friendship Bridge built in Maldives by China.  Such development make it clear that India has done well by not joining BRI.

Aravindhan V, Research Officer, C3S, highlighted the lack of significant alternatives to BRI. The prospects of a developing country in need for investments, getting lured by the lucrative offers is high. Italy’s signing into the BRI and the possible fallouts were discussed. US – Singapore economic relations through the creation of a Free Trade Hub via the Changi port, with the possible political agenda of the Americans was referenced. A point on China’s effective use of Hong Kong’s structure to root the investments into the country was highlighted. The reason why India stands her ground with not entering into BRI was also justified with the key example of Montenegro’s ‘Road to Nowhere’ (built by China) which left the European country bankrupt, a position India refuses to be drawn into.

Rahul Karan Reddy, Research Officer, C3S, described his current area of research which is the Chinese railway reforms. The China Railway Corporation regards the railway sector as the locomotive that spearheads China’s efforts in constructing the Silk Road Economic Belt (Land route of BRI). The SREB as a strategy boosts connectivity and deepens BRI ‘infiltration’ through construction and exports done through Chinese rails. The Railway Bureau in China implemented a structured incentive mechanism wherein the work done is incentivized. Rewards for performance versus penalties for underperformance like deduction of salary led to a transformation in China’s railways. The dichotomy of railways and seaways was drawn with regard to which of the two makes more sense to promote the BRI and how much returns each can bring to China.

Ms. Asma Masood gave an outline of the Young Minds of C3S- the youth forum of the think tank which has more than 200 members and counting. They interact frequently on issues of relevance to China, via various platforms including virtual ones. The C3S Internship Programme has seen 50+ interns gain from the mentorship provided by the expert members. The interns have at C3S are given the flexibility to choose their own topic and their occasional papers, monographs and/or books are published by C3S. Following the internship the youth have gained prestigious opportunities abroad including in China, Leiden University at The Hague, Australia, Rotterdam and U.S.A.

A question was raised by Ms. Morrow with regard to domestic investments and financial policy, for which the Jan Dhan-Aadhaar-Mobile trinity was referenced to as the GoI initiative to link the Jan Dhan accounts, Aadhar cards and mobile numbers. This is done to plug leakages of government subsidies and to facilitate Direct Benefit Transfer (DBT) to the Indian citizens.

She concluded on the note that there could be a possibility of obtaining some benefits from China, a country that has been isolated for a long time.

Ms. Logan was presented with a set of C3S publications. The Vote of Thanks was given by Ms. Raakhee Suryaprakash.

(Compiled by Aishwarya S. Menon, Amrutha P, and Harani Saravanan, 2nd year M.A International Studies, Stella Maris College, Chennai, and Interns, C3S.)

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