📰 The stand-off and China’s India policy dilemma
As New Delhi seeks to reset ties with Beijing, it must take note of the ongoing Chinese debate on India
•For China, which has long been preoccupied with its relentless pursuit to approach the centre of the world and in managing a turbulent relationship with the United States, the June 15 incident of a violent face-off between Chinese and Indian troops at the Line of Actual Control (LAC), causing casualties on both sides, came as a big jolt. It brought the national focus back on an otherwise not-so-popular topic of China-India relations. The development took China’s strategic community by storm, while the intense debate and discussions that followed, rather than generating a consensus, brought out China’s many dilemmas vis-à-vis India.
No accident
•On one side of the debate are China’s top India watchers such as Lin Minwang and Zhang Jiadong, from Fudan University, and Li Hongmei from the Shanghai Institutes for International Studies (SIIS) among others, who believe that the present conflict is not an “accident” but an “inevitable result” of what they perceive as “India’s long-standing speculative strategy on the China-India border”. From Doklam to Kashmir to India’s “unending infrastructure arms race” at the LAC, they say, Beijing was “fed up” and “had to teach India a lesson”.
•Their key argument is that China-India relations hold no great prospect in the current international situation. There is no possibility of a negotiated settlement of the border dispute any time soon. India is already a “quasi-ally” of the U.S. with no scope for reversal. With opportunities for cooperation at the global level diminishing, regional competition intensifying and the earlier system of effective management of bilateral differences crumbling beyond control, periodic violent conflicts, they predict, are the “new normal” in China-India ties.
•China, they argue, should reconsider its prevalent strategic thinking that India is not its main strategic challenge and, therefore, peace needs to be maintained in its direction as much as possible. Only by daring to fight, by showing strong determination, the will and the ability on the western frontier can China effectively deter its adversaries on the eastern coast. This is also, what they called, the right way to resolve China’s primary contradiction, that is the China-U.S. problem, by first breaking “its arms and legs”.
Handling a resurgent India
•To deal with a resurgent India, Chinese hardliners suggest a policy of “three nos”: “no weakness, no concession and no defensive defence”. In other words, China should take all opportunities to crack down on India, take the initiative to hit it hard whenever possible. This, it is argued, will not damage China-India relations; on the contrary, it will make it more stable. Didn’t the 1962 China-India war help China to maintain peace and stability on the western front for a long time and directly eliminate American and Soviet ambitions to use India to contain China? In this backdrop there is renewed interest among certain sections of the Chinese strategic community to: keep India under control by destabilising the entire border region, creating tension across the board, from the McMahon Line in the east to the Aksai Chin area in the west; take the initiative to attack and seize territories under India’s control from Kashmir to Arunachal Pradesh, and weaken India internally, by supporting the cause of Maoists, Naga separatists and Kashmiris.
Some criticism
•However, on the other side of the debate are Chinese political thinkers and professors such as Zheng Yongnian and Yu Longyu among others, who in their analysis of the Galwan Valley incident, have been somewhat critical about China’s policies towards India, which they say remain mostly tactical, of a “reactive nature” and are characterised by a “tit-for-tat” approach without any clear strategic intent. This, according to them, stokes extreme nationalism in India and unites the otherwise divided nation against China, which not only harms China’s interests but might eventually draw China into an untimely military conflict.
•They criticise those vying to “teaching India a lesson” as being “short-sighted” and not “psychologically prepared for the rise of India”. China, they argue, lacks understanding of the fact that India, as a rising power, is very important to China and will be increasingly crucial in the future, with China-India relations evolving as the most important pair of relations after China-U.S. links.
•If China-India ties are damaged beyond repair, they warn, India alone or in association with other countries will cause “endless trouble for China”. For instance, an openly hostile India will use every possible means to prevent China from reaching the Indian Ocean. On the other hand, the decoupling of China-India relations will further strengthen the “anti-China alliance” between the U.S., Japan, Australia, Vietnam, Indonesia and other countries, who will actively take the initiative to reshape global industrial chains, use the Indo-Pacific Strategy to check and balance China’s military and economic power, and expand international organisations such as the G-7 to weaken China’s influence in international affairs.
Opinion on scenarios
•On a similar note, various commentaries in the Chinese press highlight that downgrading China-India relations to the level of India-Pakistan relations or a ‘Kashmirisation’ of the China-India border is easier said than done as this will require a complete reversal of China’s present LAC policy of being “reasonable, profitable and economical”.
•Strategically too, they say, it is “unwise” for China to take the initiative to get into a comprehensive military conflict with India — “a big country with comparable military strength”— at this point in time. The general view among these military analysts is that if China has an advantage in terms of psychology, equipment, and logistics mobilisation, India too has advantage on various fronts such as deployment, supply line, practical war experience, topography, and climate among others. If India’s disadvantage remains in the fact that its capital lies well within the bombing range of China, China’s key disadvantage is its particularly long supply lines. Therefore, if the conflict ends in a short period of time, it will benefit China. But if it is prolonged, China will be disadvantaged.
•If a war starts, they argue, India will make all efforts to prolong it as long as possible, and the U.S. is likely to help India to attain this objective. Even if the two sides ended in a tie, in India it will be counted a victory and the national morale will rise sharply; on the contrary, in China, the morale will decline if it cannot beat India decisively. Therefore, in its effort to “teach India a lesson”, they fear, China might lose more than it would gain.
What India must note
•The overall consensus within this group is that it is still not the time to ‘resolve’ the India problem. Instead, China, for now, should strive to make India retreat without a military conflict, maintain basic peace and stability at the borders, and, at the minimum, not deliberately push it towards the U.S. Meanwhile, China simultaneously carries out its strategy of weakening India internally by leveraging its social and political differences, completing its strategic encirclement, improving troop deployment in the Tibet region to secure the China-Pakistan Economic Corridor, and stationing Chinese troops in the Gwadar Port (Arabian Sea), so as to secure China’s Indian Ocean sea routes, among other interests. In the words of another Chinese strategist, Yin Guoming, rather than winning a war, China should aim at attaining a comprehensive and overwhelming advantage in geopolitics vis-à-vis India, which cannot be altered by war.
•To sum up, despite all the jingoism and rhetoric propagated through its official media, China is actually in a serious dilemma over its India policy. As we, in India, seek to reset ties with Beijing in the post-Galwan era, we should take note of the ongoing Chinese debate on India, factor in its many internal contradictions and perceived vulnerabilities vis-à-vis India, and leverage the same to our benefit.
India’s loss in failing to develop the Chabahar port project in Iran might be China’s gain
•Right from the beginning of its tenure, the government has underlined the geostrategic importance it attaches to the Chabahar port project. The project, signed in 2003, has been a symbol of traditionally important India-Iran ties. Connected by sea lanes to ports on India’s west coast, Chabahar would form the fulcrum of India’s outreach to Russia and Central Asia, enhancing connectivity, energy supplies and trade. Given that Pakistan had blocked Indian aid to Afghanistan and all trade over land, Chabahar provided India an alternative to permanently bypass its troublesome neighbour. As a result, the government fast-tracked plans for the project, and in 2016, Prime Minister Narendra Modi was in Tehran to sign a trilateral trade and transit agreement with Iranian President Hassan Rouhani and Afghanistan President Ashraf Ghani. According to the MoUs, India would be granted a 10-year lease to develop and operate two terminals and five berths, access to the Chabahar free trade zone, and the opportunity to build the 628 km rail line from Chabahar to Zahedan, just across the border from Afghanistan. The government acted quickly to develop Chabahar port facilities, sent exports to Afghanistan in 2018, and has moved over half-a-million tonnes of cargo, including grains and food supplies, for Afghanistan again, through the port. However, the rail line has never taken off for a number of reasons despite a commitment from state-owned IRCON, to undertake its construction at an estimated $1.6 billion. While contract changes by the Iranian side and delayed responses from the Indian side were part of the problem, the main hurdle has been the fear of American penalties. Even though India was able to negotiate a sanctions waiver for the Chabahar port and rail line from the U.S., few international construction and equipment partners were willing to sign on to the project; New Delhi has also dragged its feet on the matter. After appeals to India, including one issued by its Foreign Minister Javad Zarif when he visited Delhi in January this year, Iran decided to go on its own, by beginning to lay tracks for the line connecting Chabahar to Afghanistan and Turkmenistan, last week.
•Regardless of the reasons for India’s inability to join the railway project, the decision can only be seen as an opportunity lost. The impression that India wavered due to U.S. pressure, especially after India cancelled oil imports from Iran, also questions New Delhi’s commitment to strategic autonomy. While Iran claims it will fund the railway using its own resources, it seems to have embarked on the Chabahar-Zahedan project with a confidence borne from an imminent deal with China for a 25-year, $400 billion strategic partnership on infrastructure, connectivity and energy projects. In a world where connectivity is seen as the new currency, India’s loss could well become China’s gain, and New Delhi must watch this space, created by its exit, closely.
📰 EU, India to meet on resuming FTA negotiations
COVID-19, bilateral investment, maritime security and concerns over an ‘assertive’ China will be high on the summit agenda
•Seven years after talks on a free trade agreement were suspended, India and the European Union (EU) are set to agree on a “high-level dialogue on trade and investment” to restart negotiations.
•The announcement is expected at a virtual EU-India Summit, led by Prime Minister Narendra Modi and External Affairs Minister S. Jaishankar, who will engage with President of the European Council Charles Michel and President of the European Commission Ursula von der Leyen.
•During this summit, India and the EU are expected to conclude several agreements including a roadmap for cooperation, an agreement on research sharing for civil nuclear cooperation and launch a maritime security dialogue as well as negotiations between Europol and the CBI.
•According to officials, tackling COVID-19 and its impact on the economy and the global order will be high on the agenda. In particular, medical developments on vaccines and treatment will be discussed along with the withdrawal of the U.S. from multilateral organisations (like the World Health Organisation), and concerns over an ‘assertive’ China.
•European Union officials said they had been fully briefed by New Delhi and Beijing about the situation at the Line of Actual control, as they were deeply concerned by the deadly clashes at the Galwan Valley last month, and they were “pleased” that both sides have since agreed to military de-escalation.
•The trade and investment dialogue, to be conducted between Commerce Minister Piyush Goyal and EU Trade Commissioner Phil Hogan, is expected to give a boost to negotiations on the Bilateral Trade and Investment Agreement (BTIA) as the EU-India FTA is known.
•“The leaders have expressed their ambition to move towards a comprehensive free trade agreement and an investment protection agreement and we will announce a new dialogue which will give a political impetus to such efforts,” said EU officials based in Brussels.
•An EU official, who specialises in trade issues, admitted that there was “no timeline” for the BTIA talks yet and that negotiators are still “quite far apart” due to what Europe perceives as India’s “protectionist stance”.
•“We have witnessed a trend in India that goes towards the protectionist side. The Make in India programme was accelerated by the COVID-19 crisis and recent pronouncements that India wants to go “self reliant”, didn’t help the situation,” the official said, referring to Mr. Modi’s launch of “Atmanirbhar India”.
•The official said trade with India formed under 3% of the EU’s global trade, which is “far below” what was expected of the relationship. Conversely, the EU is India’s largest trading partner and investor, and accounts for 11% of India’s global trade. The official also said the EU has reservations about the model “Bilateral Investment Treaty” (BIT) that New Delhi has proposed, especially on dispute mechanisms in Indian courts.
•Speaking about the importance of multilateralism and cooperation on global forums, the officials said the EU had welcomed India’s election to the UN Security Council next year, and that India’s role would be important in reconciling the UNSC “paralysed by vetoes and infighting”.
📰 India, China hold fourth round of consultations
Focus on phase II of disengagement
•India and China held the fourth round of Corps Commanders talks at Chushul on Tuesday to work out details on the second phase of disengagement on the Line of Actual Control (LAC). The talks were still on at the time of going to print. This round of talks come about a month after the violent clash at Galwan on June 15, which left 20 Indian soldiers dead.
•The talks began around 11 a.m. on Tuesday, a defence source said, adding they would cover the entire eastern Ladakh. The focus of the talks is to work out details of further disengagement from the standoff areas and withdraw the massive deployment by China of troops, tanks, artillery and air defences along the LAC, including at the strategically important Depsang Plains.
•Like in the previous rounds, the Indian delegation was led by Lt. Gen. Harinder Singh, commander of the Leh-based 14 Corps and the Chinese side by Major General Liu Lin, commander of the South Xinjiang military region.
•The earlier talks were held on June 6, 22 and 30. While the first two rounds were held on the Chinese side at Moldo, the third round was held on the Indian side at Chushul.
•During the talks, India has consistently maintained restoration of status quo ante of April and complete withdrawal of deployment by China along the LAC. Last week, Indian and Chinese troops completed the first phase of disengagement from standoff areas in Galwan valley, Hot Springs and Gogra and also partial disengagement from Pangong Tso, where Chinese troops moved back from the base of Finger 4 to Finger 5. However, Chinese troops are still present on the ridge line of Finger 4.
•At each place, Indian troops also moved back couple of kilometres following pull back by the Chinese troops as per consensus reached, creating a temporary buffer zone with only a small group of soldiers left to verify the disengagement. Another defence source said restoration of status quo at Pangong Tso is going to be tough and could take more rounds of talks.
📰 China making deep inroads into Iran
Tehran could get an economic lifeline, while China seeks to expand role in region
•Both countries are at odds with the U.S. One is a huge energy market and is abundant with surplus cash and the other is a sanctions-hit, cash-strapped energy exporter. At a time when the U.S. is targeting both through a host of economic measures, China and Iran are taking their partnership to a new levelthrough a $400-billion long-term agreement.
•According to a New York Times report, the countries are in an advanced stage of finalising the agreement that would allow China to expand its presence in banking, telecommunications, ports, railways and several other sectors in the Islamic Republic in return for heavily discounted oil for 25 years. While for Iran, whose oil sales plummeted after PresidentDonald Trump unilaterally pulled the U.S. out of the Iran nuclear deal in May 2018and reimposed sanctions on the country, this agreement could be an economic lifeline, China could enhance its strategic influence in a region where the U.S. has built a strong presence since the Second World War.
Strategic value
•The partnership was first proposed by China’s President Xi Jinping during a visit to Iran in 2016. The Iranian government cleared it last month, according to Foreign Minister Javad Zarif. This means, Mr. Xi made the proposal after the nuclear deal was reached in 2015 that led to international sanctions on Iran being lifted. Now, when Iran is grappling with a struggling economy hit by sanctions following the unravelling of the deal, its leadership has cleared the Chinese proposal.
•“Iran has a very crucial place in China’s Belt and Road Initiative (BRI). China always wanted to bring Iran on board. As the Americans pursued the policy of ‘maximum pressure’ against Iran and left Iran under extraordinary privation and deprivation, it is now open to the Chinese initiative,” said Talmiz Ahmad, who was India’s Ambassador to several Gulf countries.
•The partnership agreement has to get the final clearance from the Iranian Parliament. According to the NYT , China and Iran would launch joint training exercises, joint research and weapons development and intelligence sharing. China will also offer its GPS to Iran, build infrastructure for 5G rollout and develop free trade zones.
•“It is a long-term strategic partnership agreement with energy, economic, logistical and military aspects. Iran and China will be enmeshed — two countries under extraordinary and sustained American pressure found comfort with each other,” said Mr. Ahmad.
•The deal could offer an immediate reprieve to Iran’s economy that is reeling under the U.S.’s ‘maximum pressure’ policy. The International Monetary Fund has forecast that Iran's economy will contract by 6% this year. “Iran has been isolated. And its infrastructure is in a shambles. Over a period of time, this will receive an upgrade. From the Chinese point of view, Iran would present a very major energy, economic, geopolitical and logistical partner and a very crucial role player in the BRI,” said Ambassador Ahmad.
Game changer
•In his view, a new multipolar world order is emerging in which China is playing a crucial role. China has already cemented ties with Russia in this emerging order. Iran has joined this bloc. “In terms of the evolution of the new world order, this agreement is a game changer.”
•The agreement, if goes through, could attract punitive measures from the U.S. against China. The U.S. State Department has already said it would target Chinese companies if they make investments in Iran defying American sanctions. But China, which is already in a trade and technological war with the U.S., seems determined to go ahead with its partnership. China continued to buy Iranian oil over the past year even after the U.S. sanctions waivers expired in May 2019, although in smaller volumes. In contrast, India stopped buying Iranian oil last year after U.S. waivers ended. In 2019-20, India’s crude oil imports from Iran were 1.7 million tonnes, down from 23.9 million tonnes in the previous fiscal.
India’s role
•Coincidentally, at a time when Iran and China are finalising this partnership agreement,Iran has dropped India from a project to build a rail linefrom the Chabahar port to Zahedan, along the border with Afghanistan, The Hindu reported on Tuesday. The project, signed in 2016, was hailed as a major trilateral project that would give India access to Afghanistan bypassing Pakistan. But Iranian officials cited delay in the proposed $400 million funding as the reason for dropping India from the project. Under the new partnership agreement, China is likely to play a role in Chabahar port.
•The original Chabahar agreement between India and Iran was signed in 2003 between Iranian President Mohammad Khatami and Prime Minister A.B. Vajpayee. “Within a year, we abandoned it. We started engaging with the Americans, so we stopped pursing it. And again, we brought it up. Prime Minister Modi went to Tehran and we agreed on a trilateral track with Iran and Afghanistan that we would develop Chabahar and then we would go forward with building a railway and road networks. The strategic plan was to make India a potential role player in the Eurasian scenario,” said Mr. Ahmad.
•“None of this has happened because under the second Modi government, India has pursued the American line. It’s a very serious mistake. Iran cannot afford to wait for India forever. They waited for 17 years. Now they don’t need you. I think India has lost out very badly.”
📰 U.S. rejects Beijing’s claims in S. China Sea
The world will not allow China to treat the waters as its maritime empire, says Secretary Pompeo
•Secretary of State Mike Pompeo said on Monday the United States would treat Beijing’s pursuit of resources in the dispute-rife South China Sea as illegal, ramping up support for Southeast Asian nations and triggering a furious response from Beijing.
•It was the latest forceful statement by President Donald Trump’s administration to challenge China, which he has increasingly cast as an enemy ahead of the November elections.
•“We are making clear: Beijing’s claims to offshore resources across most of the South China Sea are completely unlawful, as is its campaign of bullying to control them,” Mr. Pompeo said in a statement.
•“The world will not allow Beijing to treat the South China Sea as its maritime empire.”
•The United States has long rejected Beijing’s sweeping claims in the South China Sea, which is both home to valuable oil and gas deposits and is a vital waterway for the world’s commerce.
•Mr. Pompeo’s statement goes further by explicitly siding with Southeast Asian nations, including the Philippines and Vietnam, after years of the U.S. saying it took no position on individual claims.
•“America stands with our Southeast Asian allies and partners in protecting their sovereign rights to offshore resources, consistent with their rights and obligations under international law,” Mr. Pompeo said.
•“We stand with the international community in defence of freedom of the seas and respect for sovereignty and reject any push to impose ‘might makes right’ in the South China Sea or the wider region.”
‘Vague delineation’
•Beijing claims most of the South China Sea through a so-called nine-dash line, a vague delineation based on maps from the 1940s.
•It has spent years building military bases on artificial islands in the contested areas to cement its claims, while dragging out a diplomatic process to resolve the disputes for nearly two decades.
•China on Tuesday responded forcefully to Mr. Pompeo’s comments, saying the accusation of unlawfulness was “completely unjustified”.
•“We advise the U.S. side to earnestly honour its commitment of not taking sides on the issue of territorial sovereignty, respect regional countries’ efforts for a peaceful and stable South China Sea and stop its attempts to disrupt and sabotage regional peace and stability,” said its embassy in Washington.
•The statement accused the U.S. of trying to “sow discord” between China and its fellow claimants in the sea.
•Mr. Pompeo issued his statement to mark the fourth anniversary of a tribunal decision that sided with the Philippines against the nine-dash line.
•Mr. Pompeo said that China, based on the court decision, cannot make claims based on the Scarborough Reef or Spratly Islands, a vast uninhabited archipelago.
•The United States as a result now rejects Beijing’s claims in the waters surrounding Vanguard Bank off Vietnam, Lucania Shoals off Malaysia, waters considered in Brunei’s exclusive economic zone and Natuna Besar off Indonesia, Mr. Pompeo said.
•“Any PRC action to harass other states’ fishing or hydrocarbon development in these waters — or to carry out such activities unilaterally — is unlawful,” he said.
Friction across fronts
•Mr. Pompeo also rejected Beijing’s southernmost claim of Malaysian-administered James Shoal, which is 1,800 km (1,150 miles) from the Chinese mainland.
•The 2016 decision was issued by a tribunal under the UN Convention on the Law of the Sea. Mr. Pompeo noted that China is a party to it and called the ruling legally binding.
•The United States, however, is one of the few countries that is not part of the convention, with conservatives opposing any loss of autonomy to a global body.
•The South China Sea statement comes amid rising tensions surrounding China, including a deadly border clash last month with India that Mr. Pompeo called part of a strategy by Beijing to challenge its neighbours.
•Mr. Trump has also strongly criticized China for not doing more to stop the coronavirus pandemic, news of which was initially suppressed when it emerged in Wuhan late last year.
•Critics both at home and abroad say that Mr. Trump is hoping to deflect attention ahead of the November election over his handling of the virus in the U.S., which has suffered by far the highest death toll of any country.
•Mr. Trump, after bipartisan calls in Congress, has also stepped up pressure on China over its incarceration of more than 1 million Uighurs and other Turkic Muslims.
