China has got a real taste of profits from the Indian market.
A strange wonder is this country India”, Emperor Alexander, the mightly Macedonian, had observed in 326 BC, on the eve of his “Battle of Hydaspes” with local king Porus on the banks of the Jhelum in Punjab. Many millennia later, Western historians latched on to that term for a land that they could not completely fathom. Today, in the 21st century, has anything really changed? Still the wonder that is India?
How else can one explain the volte-face by Chinese ambassador to India Luo Zhaohui, who just three weeks after suggesting that there could be a positive outcome to India’s demand for the designation of Pakistan-based Jaish-e-Mohammed chief Masood Azhar as a “global terrorist” by the UN Security Council’s 1267 Committee, then said that the issue, and the escalating friction, “should not curb the growing India-China ties”! The clear implication was that the Sino-Indian bilateral engagement was a necessity for Beijing and that New Delhi should look beyond Jaish, and “cooperate”.
The Chinese expertise in traditional multi-fanged diplomatic semantics is nothing new, and the Chinese ambassador’s April 4 essay on the completion of 69 years of “Sino-Indian diplomatic relations”, that begun on April 1, 1950, is understandable. On a lighter vein, though, why was April Fool’s Day chosen for this? Who was fooling whom, then and now?
Why the use of phrases like the “two countries pushed for a complete settlement of the issue of Sikkim”? Why rake up Sikkim, which became India’s 22nd state, today? Is Chinese diplomacy focused on improving relations between the two neighbours or on the state of India’s internal affairs?
The ambassador goes on, commenting that China-India ties fell into a “frozen period” after the “border conflict in 1962”. Indeed, a benign description of a complex issue by a country’s conflicting agenda. Things certainly aren’t as simple as they’re made out to be. India’s then Prime Minister Jawaharlal Nehru, whatever his faults may be, genuinely wished Beijing well and wanted to befriend China’s Communist overlord Mao Zedong. But Nehru was resolutely pushed to the wall by China, which delivered a monumental, humiliating blow to his political philosophy. Nehru died shattered and broken within 19 months of an Indian defeat, and his “China policy” till today is being held as a “transcendent failure”. Many Indians still curse him whenever the Sino-Indian weathercock faces fresh headwinds.
Nehru’s failure is indisputable. But the bigger failure, and fault, lay with India’s then “soft” ambassador to China K.M. Panikkar; the weak but arrogant defence minister V.K. Krishna Menon and due to the monumental misguidance by the Intelligence Bureau’s redoubtable director B.N. Mullick. They all misled the nation, after leading Jawaharlal Nehru down the wrong track. Collectively, they failed both India and Nehru. China gleefully exploited India’s internal vulnerability.
Are things so very different today?
The Chinese envoy condescendingly remarked that “bilateral relations experienced large fluctuations due to the Donglang (Doklam) standoff in 2017”. Was the
standoff India’s creation, and was China the victim? Not unexpectedly, he describes the Wuhan meeting between Prime Minister Narendra Modi and Chinese President Xi Jinping “informal and historic”.
Like a good envoy, and a true, loyal and hardcore Chinese nationalist, he gives credit to his dictatorial political boss: “China-India… relations entered the fast track of development” as it “represents a successful practice of Xi Jinping’s thought and diplomacy”. In one stroke, the entire spectrum of bilateral diplomatic “success” is brought down. It sounds like the song of a panegyrist in the court of a political master: a “benevolent ruler” in the guise of “totalitarian Communist democracy”. It’s China’s will and wish all the way. What about India’s role? There is a deafening silence!
In the Chinese ambassador’s own words: “More than 1,000 Chinese companies are doing business in India, and Chinese mobile phone brands such as Xiaomi, Vivo and Oppo represent half the Indian market.” Fortuitously, the cat is out of the bag. The stark reality of one-way gain for China and unilateral loss for India stares at gullible Indians, who are unable to grasp the gravity of their future economic scenario. They also can’t fathom what corrective action needs be taken to tackle the flood of Chinese industrial/commercial goods of mass consumption imported into India at a huge cost and a humongous outflow of India’s foreign exchange.
Make no mistake. Virtually 100 per cent of Chinese goods are grossly undervalued. For instance, even if the imported value of a particular unit can’t be less than, say, Rs 500, inevitably all the “transaction” documents prepared at the Chinese end (technically referred to as “load-port” or port of consignment loading) would show the value thereof as Rs 50. And if the rate of tax is, say, 10 per cent of the “value”, one can easily calculate the loss to the Indian economy and the national exchequer. Instead of Rs 50 per unit, the Indian government gets only Rs 5 per unit. Reportedly, the “overall mobile phone shipment to India in 2019 will be 345 million units” (or 34.5 crores). Now, you get a glimpse of the reason for the Chinese envoy’s enthusiasm! “Matters like the listing of the Security Council 1267 Committee should not curb the growing India-China ties”?
China has got a real taste of profits from the Indian market. Though far behind Beijing (2nd place), India being the seventh biggest economy by GDP; New Delhi stands as third (behind China and the US) as the “biggest economy by purchasing power” (GDP-PPP ratio). No wonder India being a part of Beijing’s Belt and Road Initiative would be a huge boost for China’s dream foreign country “domination”.
China, therefore, badly needs India as a market as well as Indian money for its BRI. For the first time, on March 18, Beijing announced its “plan to seek global partners to join the project which drew criticism for its “predatory loans… that left smaller nations in colossal debt”. If India can be roped in now, in 2019, it will be Beijing’s sweet revenge for New Delhi’s boycott of BRI’s 2017 launch.
No wonder that China is firing on all cylinders to make India succumb to Beijing’s pressure. A report by Jin Liqun, president of the Asian Infrastructure and Investment Bank, suggests: “The weak balance sheets of some Indian commercial banks and concerns about the credit environment pose challenges to India’s flagship projects”. Beijing’s state-controlled Global Times comments: “The situation may push India to reconsider and embrace the China-proposed BRI.”
Beijing’s desperation is writ large in its bid to entangle India in BRI. See the last lines of the Chinese ambassador’s article: “Regarding vision, we need to be guided by cooperation… exploring free trade agreements and achieving synergy on BRI.” Hats off to China for its long waiting game to wear India out. Will New Delhi be able to withstand the sustained onslaught by Beijing? The way Delhi succumbed to the East India Company’s traders in 1765? The time is short, but the writing is already on the wall.
POST-SCRIPT: India not going for BRI. China underplays India’s “boycott”. The Indian market being already open to China, India is (effectively) already in the BRI. That’s how the “strategy indirect approach” works!