C3S Paper No. 0115/2016
There is certainly some unwanted hype in certain media quarters both in China and India about the impending visit of Wang Yi to India and its possibilities. Wang Yi is expected to be in India on 13th and will hold discussions with Sushma Swaraj. Chinese media in general and Global Times in particular have gone overboard and have tried to counsel India on its relations and behaviour with China. Some of the statements made by Global Times (GT) are indeed quizzical; GT suggests that it is in India’s interest to not rake up the issue of South China Sea verdict during the visit of China’s Foreign Minister. It seems to suggest that India’s joining issues with the west and the rest on the issue of PCA award would be detrimental to the economic investments from India? There appears to be a veiled threat from the mouthpiece of the CPC to India which said[i]: “India is expected to allow only moderate tariff reduction on made-in-China products under the talks in a bid to preserve its domestic industries. If India wants China to be more generous(?) in terms of tariff reduction, it would be unwise for the country to let its relationship with China deteriorate further at this moment,”
The constant reference to possible adversarial impact on trade investments in India is self-defeating to say the least. In the same article GT emphasized the need for India to keep clear of South China Sea issues[ii]: “India may want to avoid unnecessary entanglement with China over the South China Sea debate during Wang’s visit if the country wishes to create a good atmosphere for economic cooperation, which would include reducing tariffs on made-in-India products exported to China amid the ongoing free trade talk known as the Regional Comprehensive Economic Partnership,”
There is a need to remind the audience both in China, India and elsewhere that India post Pokhran in 1998 withstood the sanctions by US and the rest of the world and came out in fact even stronger. It challenged the patriotism of Indians who found innovative solutions to breach technological and economic barriers. The scales of economic investments being discussed need to be put in correct perspective. Post the visit of Xi Jinping, there were expectations of some USD 20 billion being invested in India[iii]. This works out to a meager sum of USD 20 per Indian considering the population of 1.3 billion! Analysts in China including the wise people who run the GT should be aware of the scales and not hold out empty threats about the possible impact on Indian economy. It must also be noted that only some USD 1.2 billion (works out to less than one dollar per Indian) have so far been invested and there are no great investments as yet from China in Industrial parks and other sectors[iv]. The domestic market in India itself is self-sustaining and in any case there are other nations now who are willing to invest due to the environment which has been assessed to be favourable. By no means can it be considered that India where there are sound economic parameters is at the mercy of China. There are no doubts that the Indian economy is some twenty percent of the Chinese economy, China will be aware of the ground realities where even the second largest economy China was challenged and cornered by a small country Philippines using the instruments of UNCLOS.
China’s frustration post the verdict at The Hague is understandable as it has been shown in poor light as a defaulter and violator of international statutes in an arbitration process. As brought out by this author, [v] there were discreet efforts by Chinese officials both in India and China to drop subtle hints about some later day claims about the ownership of Andaman and Nicobar Islands. While it has been publicized that the meeting is a prelude to the G20 and also a stop over prior to flying out to Uganda and Kenya, some in the media have speculated that the FM of China may seek the support of India for Chinese position in the South China Sea dispute[vi]. It is obvious that China does not want to be embarrassed any further during the G20 meeting in China next month and therefore, making all efforts both through the media and also through this visit to prevent the PCA award from becoming a major point of discussion. While it has succeeded in preventing ASEAN from issuing any kind of statement about the PCA award, it is worried about the possible failure to prevent G20 from discussing the issue.
China has weakened its own position vis-à-vis India and caused a trust deficit by some of its avoidable actions. These include planning the CPEC through the disputed PoK area[vii] with a view to legitimize the occupation, blocking of the NSG membership for India, bailing out the JeM from being listed as a terrorist organisation, recent border incursions and aerial violations in Chamoli in Uttaranchal[viii] .
China also took exception[ix] to the movement of tanks to the border while it has gone on with the reinforcements and infrastructure build-up along the border for decades. China through its official media has tried to make out that India is being given preferential treatment to prop up India as a countervailing force.
China also claims that it has the support of dozens of countries for its position in the South China Sea[x]. It is very obvious as to which countries including Pakistan and North Korea have supported China. The reasons for such a support from some of the African countries are due to the economic leverages obtained by heavy investments and aid to these countries. China would have not failed to note that it lacks support from any major country of importance including signatories to the UNCLOS. The verdict has come at an inopportune time for China which is busy reclaiming land areas around reefs and rocks. It has gone ahead with the building of runways, towers, communication and radar facilities and defensive measures. The situation in the South China Sea is volatile to say the least. US Navy and Philippines are carrying out joint patrols and US planes are carrying out over flights under the Freedom of Navigation Operations (FONOPS). China has intensified its own air patrols[xi] which were commenced prior to the award of the PCA verdict. The possibility of implementation of the Air Defence Identification Zone(ADIZ) around the disputed areas cannot be ruled out as it has been argued that China has every right to declare an ADIZ[xii]. The environment now is not favourable for China to precipitate any action that would result in direct confrontation. The report that many of the Coast Guard Ships of China and hundreds of fishing craft from China[xiii] have entered the East China Sea disputed areas around Japan is again indicative of the aggressive behaviour of China despite the verdict. Japan on its part had called the Chinese Ambassador and warned him about the actions of the Chinese fishermen and the Coast Guard vessels around Senkaku Islands.
What then would be discussed during the FM’s visit? In the light of the above developments and in the scenario outlined, it is clear that there would not be much progress in terms of Confidence Building Measures (CBMs). There would be the usual photo ops and both sides would exercise some caution to ensure that the atmosphere is not vitiated. The usual remarks about tranquil borders and need for improving the climate for investments and to reduce the trade deficit which is in favour of China will all find their way in the discussions and joint statements if any. Some discussions will also take place on G20 to be held in China and also the BRICS dialogue to be held in India[xiv].
The South China Sea issues do not merit any discussion in a bilateral talk as India is not directly involved in the dispute. However, any statements made by others in the region (and those who are party to the UNCLOS) supporting the rule of law and demand for compliance with the UNCLOS would need to be supported as in the past. While having exercised the option not to be a party to the joint patrols undertaken by USA in SCS, India has every right to make strong statements that all signatories to the UNCLOS will need to abide by the letter and spirit of the provisions of UNCLOS which came in to effect in 1982 and also honour the verdict of the PCA.
What should be said? Sushma Swaraj should definitely not mince words when it comes to registering the protest for the support of China to Pakistan which has indulged in cross-border terrorism.
The alignment of the China-Pakistan Economic Corridor (CPEC) also needs to be questioned as it passes through a disputed area and attention of the visiting dignitary drawn to the protests made by India. The need for this has to be highlighted in the backdrop of objections by China to India’s off shore exploration and assistance to Vietnam in EEZ which China considers disputed. Surely, there cannot be double standards when it comes to disputed territories. By applying the same yardsticks, India has every right to pursue its energy assistance programme to Vietnam in its EEZ.
The expulsion of the Chinese journalists perhaps may come up for discussion. However, by this time the complete details of how the journalists were misusing their position to visit Nepal and Karnataka under assumed identities would be available and could be provided (if not already shared). In any case, India has categorically maintained that the visas have been extended on multiple occasions and India has no objection to replacements being appointed in their positions.
On the issue of blocking India from the NSG membership, a peeved China is well aware that India which is now a member of the MTCR will ensure that China’s pending application will continue to be in limbo. This is also on technical lines exactly on the lines of NSG membership where rules were hurled at India to prevent it from getting in to the group. India should work to ensure that China continues to feel the heat on the MTCR admission for a long, long time. Modi is expected to raise the pitch for the entry in the NSG by discussions with the Chinese President during the forthcoming G20 summit[xv] also by possibly linking this with the MTCR application of China. However, India should remember that any concession by India would be seen as a weakness and hesitation on part of India not to use the strong cards that it has in its possession.
An explanation needs to be sought as to why the PLA indulges in frequent land and air incursions. This coupled now with some violations in the air space are indeed serious and Wang Yi has to be made aware that such behaviour cannot be condoned by any standards.
It is quite possible that the discussions on One Belt One Road (OBOR) would also be on the cards. However, India has been wary of this unilateral initiative which has not discussed the entire blue print when it comes to Indian destinations. In the assessment of India, it only benefits China and India would not be a major beneficiary. Also, the OBOR foot print which spans across the Indian Ocean Region has a strategic dimension which cannot be ignored. Details of why OBOR is not at all a good idea have been covered by this author[xvi]
The rest of the discussions of course could be around the G20 and the way ahead for China and India to get the best out of this group.
It is also important to examine the areas in which there is scope for better mutual understanding and trust. The people to people contact is a weak area and unless the people of the two countries are able to interact with each other, the chances of misunderstanding and misinterpretation are quite high.
There is also a need to examine institutional ways of including India/ China study in their respective educational institutions at all levels. The first-hand account by scholars who have lived in China clearly brings out that the knowledge of Chinese about Indians and vice versa leaves a lot to be desired. The sooner the two sides engage in institutional mechanisms to address this deficit both at the official and at the unofficial levels, the better it would be to revisit the civilizational links and also promote better understanding from the root level.
Conclusion. Despite some hype by the media there is not much that can be expected from the forthcoming visit of the Foreign Minister. There is hardly any scope for support to the stand of China in South China Sea post the verdict of the PCA.
From the point of view of India, it would provide an opportunity for the two sides to frankly discuss some of the vexed issues and perceptions. India’s concerns on the above needs to made vocal. Most importantly, notwithstanding the threat held out by Global Times the Chinese Foreign Minister needs to be reminded that India is not looking for any charity when it comes to discussion on investments and trade equations. China has surplus reserves and would like to use it gainfully in all the destination countries. India is one such destination. If China wishes to keep its dwindling[xvii] USD 3 trillion reserve unutilized, the loss is entirely that of China. Such investments in India which has become a preferred destination for investments will benefit China as much as India and this point cannot be ignored. China should also be reminded that there are other economies around the world that are now in a mood to shift their investments away from China to other destinations both for strategic and economic reasons.
At the end of this meeting as long as the Foreign Minister of China has been made aware of the concerns of India and Sushma has registered her strong protests about the issues highlighted above, India would have achieved its objective of keeping the dialogue open and constructive.
[iii]http://timesofindia.indiatimes.com/india/China-to-invest-20-billion-in-India-in-next-5-years-much-less-than-Japans-offer-of-35-billion/articleshow/42814025.cms As reported by Times of India oni 18th September. Accessed on 9th August 2016
[iv]http://www.thehindubusinessline.com/economy/modi-to-push-china-for-nsg-entry-investments/article8960438.ece?homepage=true As brought out by a report in Hindu on 08 August 2016
[vi]http://timesofindia.indiatimes.com/india/China-blocked-Indias-NSG-bid-but-now-wants-help-on-South-China-Sea/articleshow/53565569.cms . As per this report by Times of India brought out on 06 August 2016, it has been suggested that China may be seeking India’s help in not making an issue of South China Sea in the forth coming G20 summit. Accessed on 10th August 2016.
[vii]http://www.dailymail.co.uk/indiahome/indianews/article-3258894/China-s-Pakistan-occupied-Kashmir-tunnels-ring-alarm-bells-India.html This will continue to be a sore issue between India and China as through the CPEC, China seeks to legitimize the occupation of Pakistan Occupied Kashmir. Accessed on 10th August 2016.
[x]http://www.chinadaily.com.cn/world/2016-06/21/content_25794520.htmTheseare the claims by China that it is supported by dozens of countries in its position on the SCS. China Daily accessed on 08 August 2016
[xii]http://atimes.com/2016/07/china-has-right-to-declare-adiz-in-the-south-china-sea/ as brought out in Asia Times on 07 July 2016 in an article by Peter Lee. Accessed on 07th July 2016
[xiii]http://thediplomat.com/2016/08/japan-7-chinese-coast-guard-ships-230-fishing-boats-in-disputed-east-china-sea-waters/ reported by The Diplomat in an article by Ankit Panda on 08 August 2016 . Accessed on 09th August 2016
[xiv]http://indianexpress.com/article/india/india-news-india/chinese-foreign-minister-to-visit-india-will-hold-talks-with-sushma-swaraj-on-aug-13-2956065/ As reported by Indian Express accessed on 08 August 2016
[xv]http://www.thehindubusinessline.com/economy/modi-to-push-china-for-nsg-entry-investments/article8960438.ece?homepage=trueThere are reports that Modi may be working on the side lines of the G20 with Xi to push for the entry in to the NSG. Accessed on 10th August 2016
[xvii]http://www.wsj.com/articles/china-foreign-exchange-reserves-shrank-in-may-to-3-192-trillion-1465289661 . In May, the reserves did shrink to facilitate fiscal adjustments as brought out by Wall Street Journal. Accessed on 07 August 2016
[Commodore R.S. Vasan IN (Retd) is Director, Chennai Centre for China Studies (C3S), and Head, Strategy and Security Studies, Center for Asia Studies (CAS).]