Why India and China need to work together to make this an ‘Asian Century’

While addressing a Press Conference on the sidelines of the National People’s Congress (NPC), Chinese Foreign Minister, Wang Yi spoke about the need for greater cooperation between China and India and the necessity for resolving differences between both countries. The Foreign Minister made the following observations:

“Despite some tests and difficulties, the China-India relationship continues to grow. The Chinese dragon and Indian elephant must not fight each other but dance with each other,” he said. “If China and India are united, one plus one will become eleven instead of two”.

Wang Yi was skeptical about the narrative pertaining to the term ‘Indo-Pacific’ (China has been more comfortable with ‘Asia Pacific’, and the Quad alliance consisting of US, Japan, Australia and India. The Chinese Foreign Minister dubbed it as ‘like the foam on the sea.’ While stating that such an alliance (Quad) was not in sync with geo-political realities of the times, Wang Yi said he would go by the members of the alliance who said that it is not meant to target any one country (China).

Indian Foreign Ministry Spokesman Raveesh Kumar, echoed Wang Yi’s views saying that India was keen to explore commonalities between both countries, rather than focusing on disputes. Said Kumar:

“We are willing to work with the Chinese side to develop our relations based on commonalities, while dealing with differences on the basis of mutual respect and sensitivity to each other’s interests, concerns and aspirations”.

Bilateral Trade

What is interesting to note is that in spite of the Doklam standoff, differences over issues like the China Pakistan Economic Corridor (CPEC), China’s continuous blocking of efforts to declare J-e-M leader Masood Azhar as a global terrorist at the UN, trade between both countries went up to reach 84.44 Billion USD in 2017 (an 18 percent rise from the previous year). After the Doklam stand off, a number of organizations had spoken vociferously in favour of boycotting Chinese goods. The government did impose anti-dumping duties on as many as 98 commodities that included certain fibres and chemicals along with a number of other commodities, as was stated in a response by the Minister of State for Commerce and Industry, CR Chaudhary to the Rajya Sabha. The Government of India however realized that the narrative with regard to boycott of Chinese goods was not a pragmatic decision.

Recent Steps

While the Chinese Foreign Minister’s statements and Bilateral Trade figures are interesting, given the pro-nationalist narrative which had emerged last year after tensions between the two countries, what has also drawn the attention of strategic community in general and China watchers in particular is a circular issued by India’s Foreign Secretary Vijay Gokhale requesting government functionaries to not attend events being organized to commemorate 60 years of the Dalai Lama in India. As a result, the Tibetan Government in exile has shifted the event from Delhi to Dharamsala.

“We’ve lived in India for 60 years and would like to express our gratitude. But we also understand India’s position. We took relevant note of reports and decided that it would be best if we just rescheduled to event”.

Gokhale, former Indian Ambassador to China, issued this circular before he departed for his first visit to China (February 23-24), and while some have criticized this move, others feel it is a pragmatic decision and is driven by India’s national interest. During the visit it was decided to take the dialogue forward and address all contentious issues through increased engagement. Commenting on the outcome of Foreign Secretary’s  visit during which Gokhale met with Chinese Vice-Foreign Minister Kong Xuanyou and Foreign Minister Wang Yi, a statement issued by The Ministry of External Affairs (Government of India) stated:

“Both sides agreed upon the need to expedite various dialogue mechanisms in order to promote multifaceted cooperation across diverse fields of India-China engagement”.

Some high level interactions are likely to take place over the next few months. April 2018 will witness the China-India strategic economic dialogue. While Chinese Commerce Minister Zhong Shan or his Deputy will attend a ministerial meeting organized by India’s Commerce Ministry to discuss WTO related issues, Guo Yezhou, Vice Minister in the International Department of the Communist Party of China (CPC) will also be visiting India.

China’s support for India

Apart from Gokhale’s circular, it was also interesting to see that China which was initially unwilling to support a US led motion for putting Pakistan on the grey list of Financial Action Task Force (FATF), an international financial watch dog (which seeks to combat money laundering and terror financing), but then it finally gave in to the demands. India’s support for China’s bid for Vice-Presidency of the organization did the trick. Interestingly, US had wanted to support Japan for the same position.

What is this recent thaw driven by? From the Indian point of view, a better relationship with China helps because New Delhi can pressurize Beijing to push Pakistan to act against terror groups like Jamaat-Ud-Dawaah JuD, and Lashkar-e-Taiba (LeT). While the US too has been telling Islamabad to do more against terror groups targeting India, China has investments massively in Pakistan for greater leverage. If Chinese pressure does work, South Asia will benefit immensely.

India-China ties: The need to strengthen Economic Linkages and involve State Governments 

If one were to look at the bilateral context, China should seek to strengthen economic linkages with states in Eastern India like West Bengal and Odisha and look beyond Southern and Western India. Chinese presence at the recent Investors Summit, organized by the West Bengal Government is a clear indicator. China has also extended an invitation to Mamata Banerjee, Chief Minister of West Bengal, to visit China. She is likely to visit China in June 2018.

Common  ground on issues like Climate Change and Trade Tarriffs

If one were to look beyond the bilateral relationship, there are issues like Trade Tariffs and Climate Change where both countries are on the same page. While in the strategic sphere, India’s ties with the US may have strengthened on issues like Trade Tariffs and Climate Change, both countries need to work closely.

On both issues, US President Trump had some harsh words for India and China.
Commenting on his withdrawal from the Paris Climate Agreement and how it’s unfair to the US, US President said:

“….countries like IndiaChina and others, we had to pay, because they (agreement) considered them a growing country. But the United States? We’re developed. We can pay”.

Commenting on tariffs, Trump said:

“We’re going to be doing a reciprocal tax programme, at some point so that if China is going to charge us 25 per cent or if India is going to charge us 75 per cent and we charge them nothing”.

On February 26, 2018 while addressing Governors from various US states, Trump stated that US did not benefit from the slashing of customs duties, on high end motorcyles (Harley Davidson), to 50 percent and India was doing no favour to India. The US President also referred to a telephonic conversation he had with the Indian PM, Narendra Modi

Foreign policy and ties between countries need to be viewed in shades of grey and can not be looked at from a zero-sum approach, and both New Delhi and Beijing realize the same.

In conclusion, leaderships of both countries have repeatedly spoken about working jointly towards making the 21st century the Asian Century. There will be divergences, between both countries. Talk of jointly working for an ‘Asian Century’ may seem far-fetched both countries, but they would be advised to adopt a realistic/pragmatic approach driven by future economic goals rather than historical baggage of the past.