World’s next big challenge: China

Rising Challenge

India needs to emulate China’s pragmatism and assertive pursuit of national interest


(C) Hindustan Times   

It has become commonplace to compare India’s and China’s economic march and project future growth on the basis of their present relative advantage.  The comparisons inexorably pit India’s services-driven growth and institutional stability, founded on pluralism, transparency and rule of the law, against China’s resolute leadership, high savings rate, good infrastructure and manufacturing forte. Little noticed, however, is that globalisation threatens China’s autocracy, not India’s democracy.

            Whether China follows a stable or violent path to political modernisation will determine its continued unity and strength. In most other aspects, China knows what it takes to become a great power. While emergent realism in India has yet to overcome traditions of naïve idealism, Beijing epitomises strategic clarity and pragmatism, zealously erecting the building blocks of comprehensive national power.

            Broadly, demographics will drive economic growth. Economies with burgeoning young populations clearly have a leg up in the economic-growth race, as nations saddled with aging citizens like Japan and several in Europe struggle to grow at rates above zero. Which country becomes (or stays) a great power will be decided, however, not by demographics but by the quality of its statecraft and its ability to develop and exploit ‘hard power’, economic and military. A nation that seeks to be ‘politically correct’ or goody-goody can never acquire great-power status.

            That is where the India-China gulf becomes wide, not merely because one is a politically open and the other a politically closed society. China’s ruthless pragmatism and assertiveness contrast sharply with India’s sanctimonious worldview. Prone to seduction by praise, India is a nation that yearns to be loved, and feels best when its policies enjoy external affirmation. China, quite the opposite, wants to be held in respect and awe, and never muffles its view when any interest is at issue. Compare Beijing’s early warning against Patriot anti-missile system sale to India, with New Delhi’s silence on the EU move to lift arms embargo on China.

The gulf is not narrower even in the way they approach bilateral ties. India, with its good-boy approach, does not believe in strategic balancing and has no intent to employ Tibet or Taiwan for countervailing leverage. The Dalai Lama’s recent statement forsaking Tibet’s independence as his life’s mission was a cry in despair. Short of expelling him and denying refuge to more fleeing Tibetans, India has bended to China on Tibet.

Beijing, in contrast, pursues bilateral ties valuing the multiple strategic cards it holds against New Delhi, including a Himalayan line of control it steadfastly refuses to define (despite hype before any high-level visit about a likely ‘breakthrough’), its commitment to maintain Pakistan as a military counterweight to tie down India south of the Himalayas, its new strategic flank via Burma, its budding military ties with Bangladesh, and its depiction of three Indian states as outside India — Arunachal Pradesh, Sikkim and J&K.  China’s latest official map shows that, like Vajpayee’s new, superstitiously renumbered street address, there was nothing rational about his claim as PM that he won Chinese acceptance of Sikkim as part of India, in return for his kowtow on Tibet.

The point is that India has been steadily eroding its leverage and room for manoeuvre vis-à-vis its main long-term rival. Loath to shape up to the challenge posed by a rapidly rising China, India has become averse to treat China even as a competitor, preferring to shelter behind the calcinatory rhetoric of cooperation.

Cooperation on equal terms demands the will to face the competition. Today, without being at a disadvantage, India can cooperate with China on what? On promoting a multipolar world, when China seeks to fashion a unipolar Asia?  On energy, when China’s annual oil imports have soared 33 percent, or three times India’s, and its egotistical autocrats revel in outbidding others, even if it jacks up prices to artificial levels?  On helping China enter SAARC, as Pakistan wants?  If growing trade could connote political progress, China and Japan, with 10 times larger bilateral trade, would not be locked today in an emergent cold war.

Energy illustrates the surreal cooperation. Eager to play the new ‘Great Game’ on energy, India, copying China, has made state-owned companies buy oil and gas fields in pariah or problem states. But there is one vital difference: China made many such investments in the Nineties when oil was less than one-fifth of the current price level, while India began acquiring overvalued assets more recently at the high end of the pricing cycle. Multinationals hesitate to acquire such risky assets, but the bureaucrats running Indian and Chinese firms readily gamble with taxpayers’ money. 

Just like the misconceived idea of sourcing India’s main gas imports through Pakistan and opening the Indian economy to Pakistani blackmail, India cannot build ‘security’ by chasing an antiquated idea that legal ownership of far-flung assets is a better bet than buying oil on the world markets. Instead of fixing its energy mess (reflected in price distortions, cross subsidies, severely restricted competition and lack of a unified energy policy), India is ready to invest up to $25 billion more to buy oil assets overseas, when its commercial nuclear-power industry is crying for smaller funds. It could prove a profligate waste of capital if, emulating Kremlin’s recent example, the concerned nations were to reassert control over their assets. When that happens, China, with its greater power-projection force capability, could recover more of its investments than India.

While romanticised visions of cooperation remain popular in India, China pursues hardnosed realism, laced with a balance-of-power strategy. It backs greater engagement with India, even as it unflappably strives to expand its strategic leverage.

When the main deputy to China’s top autocrat arrives in India at the end of next week to talk cooperation, he would have first done his bit to constrict India’s strategic options.  Starting his tour from Pakistan, his country’s ‘all-weather’ and ‘tested-by-adversity’ friend, Premier Wen Jiabao would inaugurate the Chinese-built Gwadar port and naval base, close to Pakistan’s border with Iran. Gwadar will not only arm Pakistan with critical depth against a 1971-style Indian attempt to bottle up its navy, but it will also open the way to the arrival of Chinese submarines in India’s backyard, completing its strategic encirclement.

India has only one credible option now — a single-minded pursuit of comprehensive national power.  If instead of industrialising rapidly through infrastructure growth, reform of antediluvian labour laws and open competition in labour-intensive manufacturing, India remains content with a GDP growth of 6.6 per cent versus China’s 9.5 per cent, it will find it more difficult to build a level-playing field with Beijing. And if it continues to pare down its defence spending, it will enlarge the asymmetry. While China has maintained double-digit growth in annual military appropriations since 1990, India has allowed its defence spending to plummet from 3.59 per cent of GDP in 1987-88 to 2.35 per cent in the now-opening fiscal year.

More than the global fight against al-Qaeda, a grouping now splintered and holed up, China’s rise is going to pose the single biggest challenge to world security in the years to come.  Just as India bore the brunt of the rise of international terror, it will be frontally affected by the growing power of an opaque, calculating empire next door. It can ill-afford to persist with its traditions of escapism.  An India that remains soft and confused but miraculously enjoys international power due to its size or example is a fantasy. India’s main concern now should be to grow rich and strong speedily.

© Hindustan Times 2005

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