Dialogue  April-June 2008 , Volume 9 No. 4

The Rise of China — Challanges for India

K.K. Mitra*

The 17th Congress of the Chinese Communist Party held in October 2007 reinstalled President Hu Jintao as China’s top Leader and voted to enshrine his concept of “scientific development” in the Party Constitution. Hu began his second & final five year term to lead the party and the country. Though he has used the term ‘democracy’ more than 60 times in his speech, he did not mean that China will experiment with Political pluralism and democracy. The off quoted phrase ‘socialism with Chinese Characteristics” means in plain English that the Chinese Communist Party with its 73 million members will continue to monopolise power while promoting Capitalism disguised as socialism. The political institutions will remain fundamentally Leninist as before. The ranking of the new 9 member politburo standing committee shows that the new entrants, Xi Jinping, erstwhile Shanghai party chief, will most probably beat  Li Keqiang, another rising star, in the race for succession when Hu Jintao will depart finally at the next party congress to be held in 2012 to install the so-called fifth generation leaders. For the present, the leadership will be even more concensus driven as a result of which sweeping policy changes, both domestic and foreign, in the short and medium term can be ruled out. Stability and continuity will be key mantras. Hu’s concept of ‘scientific development’ and the goal of “harmonious society” are words which have political and economic implications. China will now onwards steer the economic model away from growth at break neck speed and choose more balanced and sustainable path. The party will pay more attention to long neglected social equity and justice. It is an official acknowledgement that the large sections of Chinese people did not reap the benefits of economic growth and there is considerable lack of harmony in the society due to uneven development.                                                                                                 

     The communist party’s legitimacy and authority has been severally dented by massive public protests, riots and demonstrations. The party leadership had to tackle rampant official corruption, growing social unrest, widening income gaps, serious environmental degradation, rising unemployment, lack of adequate housing, medical care and education. According to world Bank figures, over 135 million Chinese in remote western and interior regions still have consumption levels below a dollar a day without access to clean water, arable land or adequate health services and education facilities.                                                                         

     The new fifth generation leaders are younger, better educated and less ideologically oriented than their predecessors. Many were among the first University students to win their places in competitive examinations revived in 1977. While almost all of the fourth generation leaders are engineers, many of the new leaders are trained economists, lawyers and historians. Xi has a law degree and Li has been trained as a lawyer and economist. Although the new generation joined politics in relatively liberal period after China launched market oriented reforms, there is no reason to hope that having come to power they will begin to experiment with political reforms. By all indications, China will see ever greater tightening of the party’s control over speech and civil liberty in the days to come.                                                                                                        The guard has been changing in the military too. The incoming leaders of the PLA who have been inducted into the central military Commission are well educated younger officers and many of them are so called “Taiwan Experts”. Quite a few of the new military top brass are known to possess advanced technological knowledge. Senior naval and air force  officers have made it into  the PLA Headquarters of the general staff, general logistics Deptt, Defence University and Academy of Military Sciences — posts previously held by officers from the PLA Army. Gneeral Xu Qiliang and Wu Shengli — two former deputy Head of the PlA general staff  and experts in anti-aircraft carrier operations — have been promoted as Commanders of the Air Force and the Navy respectively. These two branches are likely to get more resources because Hu Jintao is known to be in favour of strengthening these two branches of the PLA.                                                                                      

    The cruicial issue today is the future of ideology. The appeal to communist ideology has gradually weakened since the Deng era. His successors have been facing growing instability and gradual slackening of the party’s grip on power. The economic reforms have brought about major changes in people’s attitude towards the party and the government. The ever widening economic disparities and unfulfilled expectations of higher living standards and a host of other factors have given rise to public cynicism. The  emergence of a civil society consisting of professionals and private entrepreneurs in major urban centres and coastal areas have led to visibly smaller presence of the party and the state in many sections of the society today. As the ideological appeal and legitimacy of the communist party declines, the leadership will be more and more discouraged from experimenting with political reforms.                                                                                                         

     The mission for the new generation of leaders will be development with stability. The Chinese have learnt from the Soviet experience that internal instability and lack of cohesion can break up a mighty military power. The former Soviet Union could not eliminate the historical incompatibility and the genuine grievances of the Slavs, Baltics, Transcaucasian and Central Asian peoples. When the authoritarian communist system collapsed, the superficial illusion of homogeneity disappeared and different regions of the country broke away declaring independence. The Soviet Union collapsed from within and not because of external aggression.                                                                                             

     The dominant Chinese concern with stability is illustrated in various official documents, speeches and in China’s white papers on National Defence published biannually. However, centrifugal forces and ethnic friction are not likely to present unmanageable threats to the internal security and stability of the Chinese state. No doubt, there is serious disaffection in Tibet Autonomous Region where the government has encountered periodic public protests and riots by the local people. These have been ruthlessly suppressed but the problem persists. In Xinjiang, there has been separatist violence and unrest over restrictions on the practice of Islamic religion. Inner Mongolia has also witnessed unrest from time to time. But unlike the former Soviet Union, in China, Han Chinese are an overwhelming majority accounting for nearly 93 per cent of the population. They have been systematically settled in various Autonomous Regions over the years. In Inner Mongolia and Xinjiang, they are actually in a majority. Besides, China’s leaders are not likely to tinker with the Leninist political system as Gorbachev did with disastrous result. Nevertheless, China can not afford to ignore ethnic and religious separatist movements altogether. It views the growing Islamic fundamentalism in Pakistan and some of the bordering Central Asian Republics with concern. The ruling elite of course can count on the People’s Liberation Army (PLA) to bring overwhelming military force to safeguard the unity and integrity of China in a crunch situation. The PLA has done so in the past, protected China’s sovereignty and sustained the one party rule whenever called upon to do so. Although the PLA leaders have almost disappeared from the front ranks of the party, the PLA remains an important, albeit, somewhat invisible force for China’s leaders.                                                                                      The present generation of PLA leaders are educated, technology-savy  professionals who are keen to ensure that China achieves rapid modernization of the Armed Forces and enhances its military power. Most of them remain convinced that the western powers and the USA in particular will weaken China by promoting dessent and separatism. Interestingly, the political leadership and the top military brass are quite united on the issues of national defence and military posturing. The strategic thinking of China is based on the concept of maximization and management of Comprehensive National Power (CNP) which defines power not only in terms of military and defence related matters but also political, social, economic and technological development. The National strategy consists of developing CNP and exploiting to maximum advantage the relative configuration of external powers. The approach enables China to measure its national standing vis-à-vis the relative power of other nations. Consequently, China seeks strategic leverage by exploiting rivalries and manipulating relations with other states.  The main objective is to prevent the emergence of a dominant power or alignment of powers opposed to China.                                                       China’s strategic goals will be as follows :—

·       Capability to deal with military contingencies relating to Taiwan.  Capability to deal with adverse political and military scenario in the East Asia region resulting from Japan - US alignment.  Capability to secure the sea lines of communication and protect  its oil supply route from West Asia and Africa in the Indian   Ocean through rapid modernization of its Navy.

·       Capability to deal with military contingency relating to India.

·       Capability to deal with domestic social unrest and religious  separatist forces.

     The USA will remain the primary target of China’s defence planners followed by Taiwan, Japan and India. China has traditionally adopted rigid stance in respect of its territorial claims vis-à-vis other nations. As David Shambaugh has noted in a New York Times Article, Chinese society embodies two types of nationalism — one Xenophobic, rooted in perceived indignities experienced in the past and the other suave and cosmopolitan as China integrates into international community. There were virulent anti-west demonstrations in China following images and pictures of anti-China pro-Tibet demonstrations world wide during the Olympic Torch relay which surprised many foreign observers. When Mao founded the PRC, he promised to restore China’s dignity and never permit China to be insulted, subjugated or divided again. Decades of indoctrination of ideas regarding the so-called centuries of shame and humiliation foisted upon the Chinese people by European colonial powers, American missionaries and Japanese invaders have reinforced and strengthened these societal beliefs. Consequently, Tibet, Xinjiang and the  British imposed ‘Line of  Actual Control’ separating India and China are issues on which China tends to show zero tolerance.                    

     China’s latest Defence white paper released in December 2006 reiterates its national security concerns which are:— Prevention of National separation and promotion of reunification, Territorial integrity and maritime rights, defence modernization and enhancement of operational capabilities appropriate to the Information era. According to a study made by the US Department of Defence, there is a broadening range of Chinese capabilities that could be utilized in various “non-Taiwan Contingecies” involving neighbouring countries.  If correct. China’s Military Modernisation has clear implications for India’s Defence Planners.                                             

    During most of the last 20 years, China’s Defence budget had double digit increases. Its military budget will increase by 17.6% to nearly $ 59 billion in 2008. Experts know that actual military outlays in China will far exceed the declared amount because official figures hide many items such as cost of new weapons, R&D etc. China is determined to acquire much greater military muscle and poised to seriously challenge the USA as a rising Military power. However, it has a long way to go to challenge the US for global predominance. But as far India is concerned, China will do whatever it can to curtail India’s area of influence. It has forged  enduring military relationship with Pakistan which includes nuclear partnership and continues to make significant efforts to gain foothold in Myanmar, Bangladesh, Nepal and Srilanka. China will seek to ensure that India remains busy with its neighbours in South Asia and can not play a meaningful role as a potential counter weight to China in collaboration with USA in the years to come.                                                                                 

    China is already miles ahead of India in all configurations of military power resulting in clear military asymmetry between the two countries. It will not be long before the rapidly modernizing Chinese Navy submarines will make active forays into the Indian Ocean Region. The latest news of a major nuclear submarine base on the Southern tip of Hainan Island confirms the speculation that Chinese SSBN (Nuclear Submarines armed with strategic missiles) development programme is very active. The Hainan Island base will have the Shang Class (Type 093) nuclear powered attack submarines and the Jin-Class (Type 094) SSBN’s. China is also developing new submarine launched nuclear ballistic missile JL-2 with range of 8000 km. By 2010 five of the Jin class submarines may be operational., China has imported $12 billion worth of weapon systems from Russia including submarines, destroyers, Sukhoi-27 and Sukhoi-30 fighter jets. As far as nuclear arsenal and ballistic missiles are concerned, India is altogether in a different league. But there is no need to worry too much on that score because India needs only limited but credible and survivable deterrent to cope with nuclear threat from China. As and when India operationalises Agni-V (ICBM), it will be able to target some of China’s key population and Industrial centres from deep inside Indian territory. China’s next generation solid fuelled road mobile ICBM’s like DF-31 and DF-31(A) are primarily meant for deterring the USA and other western powers. China has recently shaken the western world by successfully testing an anti satellite weapon which means that China will be able to knock out low orbiting satellites in space in future.                                                                     

    China is aware of the concerns raised by its rapidly increasing military and economic power and it has replaced the term “peaceful rise” with “peaceful development”. It has set up ‘Confucious Institutes’ in a number of countries to make use of its ‘sofe power’ by popularizing Chinese traditional culture and heritage. It has sought to establish its image as a responsible world community member and will no doubt showcase its benign image on the eve of the Olympics it will host this year. But the present writer agrees with many China specialists who believe that as and when China becomes strong enough to dominate the established world order, it will do so. Empirical evidence shows that Chinese strategic thought is marked by long tradition of denial and deception. Hence no one can ever be sure whether to take China’s peaceful intentions at face value or not. As June Treufel Dreyer writes, “one should hope for the best but plan for the worst” (“China’s power and will : The PRC’s military strength and grand strategy”, ORIBIS fall 2007).                                     

     PRC’s economic engagement with other countries arouses as much concern as its rapidly growing military capabilities. It’s economic growth hovering around 10 per cent annually for most of the last 25 years is spectacular. To sustain this growth rate China has to import oil. It has surpassed Japan as the world’s second largest petroleum consumer. Its size and purchasing power might eventually deprive other big countries, notably, India which also depends on huge oil import. The Chinese companies have the penchant for buying equity oil for which the firms have proprietory rights as a result of equity ownership in developmental projects rather than buying in the international market. The other major concern relates to its huge trade surplus with most of its trading partners. The US has the largest trade imbalance — over $ 212.7 billion in 2006. The European Union’s Trade deficit vis-a-vis the PRC was Euro 106 billion in 2005. It is generally recognized that China keeps the currency at artificially low level making for low prices of Chinese goods. Much of China’s huge foreign Exchange holdings (estimated to be $ 1 trillion) are held in US treasury bills. If Beijing chooses to divest these, the US housing market will be depressed and the dollar will be weakened further because these subsidize low mortgage rates.                                                             

      Sino Indian Trade has seen an incredible  increase from $ 2.5 billion in 2000 to nearly $ 39 billion in 2007. China is now India’s second largest trading partner and may eventually overtake the US as India’s largest trading partner. However, in the economic relationship there is the danger of becoming a one way street. India’s trade deficit with China has gone upto $ 9.2 billion in 2006-2007. In certain critical sectors, Chinese exports are worrisome. China’s industrial goods exports to India amount to 10 per cent of India’s industrial GDP. If this pattern is allowed to continue, Chinese products may replace India’s manufactured goods. Low prices in China with massive subsidies to capital will make it difficult for Indian industry to compete with China. India needs to enter Chinese markets in areas where we have established edge such as India’s pharmaceutical products. Indian IT companies have failed to obtain Chinese orders and are working with MNC’s operating in China. Indian heavy engineering companies have not secured significant foot hold in China. Though India is exporting non–renewable resources like iron ore and other minerals, it has not been able to obtain coking coal from China. As the Secretary General of FICCI has observed (Times of India, Jan 12, 2008) it is time now to turn an unequal economic engagement into a win-win deal.                                             

      China has been the prime mover in Shanghai Cooperation Organization (SCO) consisting of China, Russia and four Central Asian countries. India was admitted as an observer in 2005. Central Asia is India’s strategic neighbourhood and India has good reason to develop economic relations especially for meeting its growing energy needs. India has a stake in the stability of this region for combating terrorism and extremist ideology. But economic cooperation has so far remained at a low level. India lost to China in its bid for oil contract in Kazakhstan in 2005. Trade between central Asia and India is limited due to instability in Afghanisatan and reluctance of Pakistan to allow Indian goods to pass through its territory. Hence the need for developing a North– South Transport Corridor to Russia and Central Asia.                                                                                               

    In South East Asia, China is seen as a long term threat on account of China’s past record on Contentious issues like Taiwan and Spratly islands. But the South-East Asian countries do not publicly articulate their fears and misgivings. They are following the policy of shaping a new regional order by engagement with China. China too has made serious efforts to win the support of its South-East Asian neighbours through Free Trade Agreement with ASEAN and other forms of economic aid. Besides giving significant military assistance to Myanmar, China is providing limited military equipment to several South-East Asian countries. Many of these countries are, however, seeking to expand their military links with the USA. This is inevitable after China passed law enunciating the principle that South China Sea is sovereign Chinese territory and got involved in the clash with the Philippines in Mischief Reef in 1994.                                       

        India’s ‘Look East Policy’ has been premised mainly on economic considerations. There are signs that this policy may acquire strategic dimension. India, Japan, South Korea and Australia can and should play a more proactive role in the region. The joint military exercise involving Japan, USA, Australia, Singapore and India is September 2007 had a larger strategic aim which Chinese analysts did not fail to notice. There are several areas of convergence between India and South East Asia — namely, war against terrorism and extremism, transnational crime, maritime safety and so on. India is looking at its evolving relations with this region from the prism of its domestic compulsions—especially for peace and stability of the North East and the Andaman Sea. For economic prosperity and peace in the North East, India needs the cooperation of Bangladesh, Nepal, Myanmar, Thailand and China. This region has cultural, traditional, ethnic and other transnational links which facilitate insurgency, subversion, terrorism, drug-trafficking and other forms of transborder crime.             

       India will be looking at the Asia – Pacific region as one of cooperation rather than confrontation with China keeping in mind its growing economic engagement with China. There is scope for much larger Indian investments in China. The two countries may emerge one day as partners in energy cooperation in central Asia along with Russia. All three now sit at G-89 Conference Table. Various tensions and frictions notwithstanding, India will look at opportunity for peace and prosperity of this region. India’s trade with the countries bordering the North East has gone up but no impact  is seen in the region because commerce is through the seaports. There are massive imports into the region and Chinese consumer goods are everywhere. But these come through unofficial illegal channels. 97 per cent of the natural resources of the region is not exploited. The infrastructure for tourism remains poor though landlocked Nepal, Bhutan, Tibet and Myanmar attract far greater number of tourists with equally poor infrastructure.                                                                                         

      There has always been a basic difference in the way India and China look at and treat each other. Both countries see themselves as rising powers deserving notice, respect and mutual understanding. Yet while India treats China as such and remains careful not to hurt Chinese sensibilities, China is reluctant to consider India as a worthy strategic or economic power. In official pronouncements, China refers to India as an important Asian country. India’s distrust of China is based on China’s track record. China violated international treaties and norms in supplying Pakistan with nuclear weapon designs, enrichment know how and missile capabilities. This nuclear nexus continues till totay. But while India fights shy of telling the Chinese about its concerns, the Chinese keep on lecturing their Indian counterparts about Tibet and Taiwan. In keeping with Indian practice of respecting Chinese sensibilities, Indian leaders go out of their way to declare that India is not going to be a part of any US-led attempt to contain China while China undermine Indian influence in Nepal, intrudes into Bhutan, and threatens our access to the “chicken’s neck” in the North East. China opposes India’s membership of the UN Security Council and seeks to exclude us from regional groupings in South East and East Asia. Chinese official media has been openly critical of the US-India nuclear agreement and its diplomats are busy asking members of the Nuclear Suppliers Group to reject US led moves in support of the deal.                                                                                                                   

      Chinese troops have intruded a dozen times into Indian territory in Eastern Ladakh as China continued its aggressive patrolling along the LAC. According to one report, there were more than 140 intrusions by PLA troops across the 4057 KM LAC in 2007 including transgressions  into Sikkim. China has strengthened its position in Tibet in terms of logistics and transport. The now operational Qinghai-Tibet railway is going to be expanded further linking Lhasa with Shigatse  and Yadong near the Sikkim border. The India government has belatedly decided to make some moves to connect our border areas in the North East. Chinese nationalism is ‘territorialist’. It has never given up its ‘historical claims’. The official maps released by China show the territories China lost as its own. Mao had once described Tibet as China’s palm and Nepal, Sikkim, Bhutan, NEFA and Ladakh as its five fingers. While it does not give up its territorial claims, China prefers shelving these disputes till it finds suitable time and opportunity in future. The South China Sea Islands or the Senkaku issue with Japan are cases in point. As far as India is concerned, it has become almost customary for China to reiterate its claims on Arunachal Pradesh before every high level visit to and from India. Although Prime Minister Manmohan Singh did not visit Tawang for fear of annoying the Chinese, there was low-key protest following his recent visit to Arunchal Pradesh. China has consistently refused to grant Visa to any official from Arunachal Pradesh on the ground that no visa is required for a citizen of the PRC.           

      It has taken two decades of negotiations with China to exchange maps of one minor, least disputed sector. After the border negotiations restarted at a different level in 2003, there was agreement on several broad principles during a meeting between the Prime Ministers of India and China. One of the principles agreed upon was to safeguard the interests of settled population in the border areas. However, soon thereafter China realized that this principle would make it difficult to stake its claim on Tawang which is based on the so-called past Tibetan religious and ecclesiastical influence on this territory. But China forcefully separated from Tibet, two regions where Tibetan religious jurisdiction and political control existed throughout history — AMDO and KHAM which have been incorporated into Qinghai, Sichuan, Gansu and Yunnan provinces.                                      

      India has gone out of its way to prevent Dalai Lama and his followers to protest against human rights violations in Tibet in disregard of its democratic principles and law. Peaceful Tibetan marchers were arrested inside Kangra District whereas they could have been prevented only at the border from crossing into Tibet without valid travel documents. India does not allow Dalai Lama, a spiritual leader renowned world wide, to even respond to abuses hurled against him by the Chinese officials and its media. Such needless kowtowing to China has not given India any brownie point so far. Chinese troops intruded into parts of Bhutan’s Northern border because China has not given up efforts to force Bhutan to delineate its border with China. When Chinese troops destroyed Indian Army bunkers of Sikkim-Bhutan-Tibet tri junction, New Delhi did not even acknowledge the incident for several months before the matter came up in Rajya Sabha. Bhutan is important because Chinese crack down in Tibet will have direct impact on Tibetan Migrants in Bhutan and ethnic disharmony in Bhutan will have security implications for India. Bhutan is strategically important because its Western border juts into the narrow Siliguri Corridor that connects India to the North Eastern states. The dynamics of an open border for Trade between India and China at Nathu La needs to be carefully watched by security and defence planners.                                                                   

     For many in India and elsewhere, comparing and contrasting India with China has become a fashionable past time. Both countries are positioned at the “strategic cross roads” of the world. India has to live with its large neighbour and somehow manage the complex relations which are marked by deep mutual suspicion. If India realises its full economic and military potential, it can hope to acquire countervailing power of sorts vis-a-vis China by the end of the next decade. In the coming years, India will have to watch China not only across the Himalayas but also in the larger Asian context and the Indian Ocean Region where the interests of the two countries are likely to intersect in future. Internally, the two countries face almost identical macro-economic challenges. But China’s authoritarian political system is better suited to tackle these problems. India’s chaotic multi-party democracy with its persistent crisis of governance may delay India’s rapid rise as a regional power. India faces immediate serious threat from within. Unlike China, threats to internal security and integrity of the country from various non-state actors such as transborder terrorist groups, religious fundamentalists, ethnic insurgents and maoist extremists have overshadowed traditional external military and territorial threats. This is hardly surprising because India is a multi-ethnic, multi-religious, multi-lingual country with hundreds of castes, sub-castes and classes with enormous potential for intra-state conflict. These problems have assumed critical dimensions because the state has failed to deliver social and economic justice to vast majority of its citizens resulting in alienation amongst people living in border areas and remote hinterland. This has provided opportunity to hostile neighbours to manipulate vulnerable sections of people and create trouble and instability. The encirclement of India within the South Asia Region which China seeks so assiduously will succeed if India fails to govern itself and manage the various internal challenges to its security.