C3S Paper No. 0019/2016
An informal interaction was held with Dr. Raj Verma at the Chennai Centre for China Studies (C3S) on January 28 2016. Dr. Verma is Assistant Professor at School of International and Public Affairs, Jilin University, China and Visiting Fellow at IDSA. His main areas of focus are India-U.S.A-China trilateral relations. He also studies India and China in Africa and BRICS, with emphasis on Russia, India and China. The link for his profile is at: http://www.idsa.in/profile/rverma.
Readers may kindly note that the following views are the speaker’s own.
Dr. Verma believes that China faces many economic, political, social and cultural problems. The 6.5 per cent growth rate may be an over estimated figure. Skeptics say the actual figure may be between 3-5 per cent. Reforming the Chinese political economy may prove to be a challenge due to the deep-rooted practices in the country.
One particular aspect that stands out is the lack of institutions in China. Consequently, Chinese have to rely on ‘guanxi’ (inter-personal relations). As the Chinese are commendably very proud of their culture, it is not easy for change to occur. The way the Chinese behave domestically reflects on their external behavior.
Another interesting factor is the Confucian vertical authority structure in China. It dictates that orders must be followed, even if not in consensus. It is related to another belief in China, that of avoiding criticism. Additionally, a curious trend is to address anyone with slightly more work experience as ‘Laoshi’ (teacher). People cannot be fired, and influence is consolidated by the desire to avoid institutions. Even students are given several chances to pass examinations.
While these are unique Chinese ways of life, they may have some disadvantages. Creativity and quality may not reach the optimum levels. It is reminiscent of the Soviet economic model, where ‘more is good’ and ‘big is better’. There is little emphasis on quality. There are vested interests involved as seen in the corruption cases. Interestingly, there is no Ministry of Energy in China, a country where energy giants such as CNPC and SINOPEC thrive. President Xi Jinping is trying to address the issue of these vested interest groups. He is accumulating power in the process. He may even try for a third term. There are opinions among some in China that the State will become more powerful or be replaced by faction(s) supporting Xi Jinping.
On the social front, unemployment is increasing. There is disparity in (un)employment figures provided by the government and international media and organizations. It could be basis for social unrest. In terms of the military, China may become more assertive in the South China Sea, with India and with Japan to shore up domestic sentiment and nationalism if economic growth slows considerabley or China is unable to restructure the economy. When it boils down to the internet, since January/February 2013, there is no access to Google, Gmail and YouTube. The accuracy of Chinese version of Wikipedia is questionable.
The Indian dimension cannot be ignored when observing China. By 2025 India may surpass Japan economically, while China will be superior in economy and military terms relative to other countries in Asia Pacific except the US. At that juncture, it will be crucial timing for the West whether to include India in alliances. On a comparative note, China will have military hardware, but the professionalism of the armed forces may be lower than that run from Tokyo. Besides, the PLA is known to hold companies in various sectors. There is also a degree of autonomy in its functioning. This possibly leads to certain decision-making without the Chinese government being aware.
The Chinese government also has less hold on provincial governments than perceived. There is no system akin to India’s concurrent list of central/state government powers. The state tries to control the stock market, which can prove to be tricky. The stock market is 25 years old and immature. Approximately 80 pr cent of the investors are ‘Grandpa’ and ‘Grandma’ investors. Besides, Hillary Clinton reached the conclusion that China was going to collapse because the children of Chinese leaders were leaving China. The recent economic slow down has also led to capital flight of approximately $1.5 trillion. The speaker believes that the economy needs to be restructured in China for optimal performance. Despite the slowdown, China moves forward. This is because the country displays a culture of hope, similar to India.
The CCP is hopeful, and it tends to its goal of providing food, clothing and shelter to the people. In Chinese culture, anyone who addresses these three needs and provides protection from external aggression, and makes the people thereby richer, becomes the emperor. The CCP is also omnipresent. It directs that gatherings be supervised by the police. It may hint at a degree of insecurity being felt by the authorities. It is crucial for them to hold onto power. In fact, as observed by Prof. William C Wolforth, it was the failure of the Great Leap Forward that forced Mao to start the war with India in order to restore legitimacy for his rule.
In recent years, the people in China, unlike India, are not allowed to own more than two houses to prevent a real estate bubble. People utilize money by spending on foreign trips and purchases. However one similarity between India and China is that the people are very hard working. It is the systems which do not allow the people to progress at the desired velocity. Nevertheless, the Chinese are completely focused on their goals. It is in their cultural DNA to not retreat. Even women of the household in rural areas tend to the farm if the men are away looking for urban employment. One advantage the Chinese have is that food is very cheap, as it is subsidized.
When it comes to the media in China, they are quite critical of India as shown by wide coverage of negative incidents especially in the Global Times. This may be a target at India’s soft power. India has enormous soft power leverage when compared to China. People flock to learn Chinese cultural dimensions and language for economic reasons.
Significantly, India can take advantage of China’s slowdown. If Beijing doesn’t reach the projected target in 2060/2070, India will surpass China and the US to become the largest economy in the world. India if it able to overcome its domestic problems can be on the same eye level as U.S.A, unlike China, which has an authoritarian government. For China to truly be in the same shoes, it must democratize. However democratization is not easy in China because throughout its history, China has never had democracy. Some scholars argue that democracy is antithetical to Chinese culture and may even lead to collapse of China.
Cmde. Vasan, Director, C3S, gave the vote of thanks.
(Compiled by Asma Masood, Research Officer, C3S.)