India and China proposed creating a business model called
chindia based on COIN (Cooperation & Innovation) in four areas (Energy,
Health, Infrastructure, Knowledge intensive industries)
Background
·
India was
o
The second non-communist state to recognize PRC
in 1949
o
the 16th state to establish
diplomatic relations with PRC in 1950
·
1954: eight year agreement on Tibet - Panchsheel
·
1962: War
·
1960s-70s: Sino-Indian relations
deteriorated because
o
War
o
Sino-Pakistani relations improved
o
Sino-Russian relations deteriorated
·
1967: Nathu La incident; Chola incident
·
1976: Restored ambassadorial relations
·
1979: External Affairs minister AB Vajpayee’s
visit to China
·
1988: Rajiv Gandhi’s visit to China
o
Agreed to develop and expand bilateral relations
in all fields
o
Establish a Joint Working Group on Boundary and
Joint Economic Group
·
Mid-1990s: relations started improving
·
1992: President E Venkararaman visited China.
This was the first Head of State level visit from India to China
·
1996: Pres Jaing Zemin’s visit to India
·
2003: Declaration on Principles for Relations
and Comprehensive Cooperation signed
o
First comprehensive document on development of
bilateral relations signed at the highest level between India and China
·
2008: ‘A Shared Vision for the 21st century of the
Republic of India and the PRC’
·
2011: Year of India-China exchange
·
Perception of each other
Table 1
|
India’s perception of China
|
China’s perception of India
|
|
|
A very important nation in South Asia
|
|
|
Population next only to China
|
|
|
Economy growing at a fast pace. Security forces mobilizing. Nuclear
power.
|
Major Outstanding Issues
Table 2
|
Issue
|
India’s Concern
|
China’s concern
|
|
Boundary
|
|
|
|
Visa Policy
|
China giving stapled visa to residents of Kashmir
|
|
|
Trade
|
China accused of dumping goods in India.
|
India imposing ban on investment of certain Chinese companies
|
|
Dams
|
China building dams on the Brahmaputra river
|
|
|
Tibet
|
|
India’s asylum to Dalai Lama
|
|
Geopolitics
|
String of pearls;
Relations with Pak – China’s presence in PoK, China’s policy on
J&K, nuclear relationship with Pakistan
|
India’s growing relationship with US
|
|
Defence Cooperation
|
|
|
|
Competition in South Asia
|
|
|
Border dispute
·
China’s claim in two regions
o
Aksai Chin
o
Arunachal Pradesh
·
These two regions are strategically important
for China to control the restive populations of Xingjian and Tibet and
integrate them
·
The Macartney-Macdonald Line proposed during
British times is almost the same as the present Line of Actual Control
o
The northern boundary between India and Tibet
was never clearly demarcated
·
The McMahon Line forms the eastern border with
China
o
British India and China gained a common border
in 1826 after the British annexation of Assam and the Treaty of Yandabo
o
1913-14: representatives of Britain and Tibet
(and Myanmar or China?) attended a conference in Shimla and drew up an
agreement concerning Tibet’s status and borders
o
McMahon Line was drawn
o
China objected to the proposed Sino-Tibet
boundary and repudiated the agreement
·
East-West swap
o
Zhou Enlai had proposed that China relinquish
its claim to most of India’s northeast in exchange for India’s abandonment of
its claim to Aksai Chin.
·
1962: War
·
In recent times, India China boundary has been
one of the most peaceful borders in the world
·
A solution to the question is not due to lack of
effort; instead it arises from the difficulty of the question itself
·
CBMs are in place to ensure peace in border
areas
·
Special Representatives (SRs) talks are
conducted on the border question
Defence exchanges
·
Recently defence exchanges were stalled after an
Indian army officer was denied visa (?)
Dalai Lama
·
Sought refuge in Dharmsala in 1959
Mangement of transborder rivers
·
Many of our northern and north eastern rivers
arise in the highlands of Tibet
·
Dams: Zang-mu
o
India has sought assurances from China that it
will take no action to negatively affect the flow of rivers into India
o
China has assured that the projects on
Brahmaputra are run-of-the-river projects
Pakistan-China relations and effect on India
·
China’s growing relations with Pakistan are of
concern to India
·
China has been the main supplier of weapons
systems and air and naval combat craft to Pak
·
China is co-producing K8 trainer aircraft and
JF17 fighter aircraft in Pak
·
Supplied Pakistan with M-11 SRBM
·
·
Civil nuclear cooperation
·
Development of road, rail and gas pipeline
infrastructure through the Gilgit-Baltistan region as well as port facilities
in Gwadar
·
India believes that a stable and prosperous
Pakistan is in India’s interest. It does not view bilateral relationships as
zero-sum games
·
But there are some genuine concerns
o
China’s role in POK
o
China’s J&K policy
o
Sino-Pak security and nuclear relationship
The Way forward
·
when it comes to the relationship between these
two big Asian giants, a lot of what happens in this relationship will impact
the situation in our region and particularly when it comes to the economic
strength the rising economic strength of both these countries the world
certainly is watching and assessing the impact of this relationship.
·
Media has caused a lot of frenzy in the
relations of the two countries
o
Media should keep quiet a bit so that
India-China can solve their problems amicably
·
Chindia
o
China-India global joint action
·
In a high level meeting in November 2010, CCP
politbureau member Zhou Yong Kang outlined some areas for further development
of Sino-Indian relations in order to consolidate their strategic cooperative
partnership:
o
Promoting political trust by maintaining
high-level visits between governments, parties, parliaments and militaries.
o
Greater cooperation in trade and economy that
should include reducing protectionism.
o
Greater people-to-people exchanges in a wide
swathe of areas.
o
Strengthening international cooperation and
friendly consultations on controversial issues and disagreements in exchanges.
·
Developing Synergy
o
Tagore was for close relationship between the
two countries
·
S&T exchanges should be strengthened
o
MoU on Green Technology; exchange of
hydrological data
·
India-China have a role to play in the security
architectures for Asia
o
Issues of maritime security, issues concerning
global commerce in the region, issue of terrorism, having peaceful periphery
are common concerns
Are India-China rivals?
·
Neither of the two countries have a luxury of
seeing each other in purely antagonistic terms
·
The view that India and China are rivals is a
over generalisation as well as an over simplification of a complex relationship
which encompasses so many diverse issues
·
Proposition of competition and rivalries should
not be exaggerated in a manner that it overshadows our genuine attempts to
manage and transact a rationally determined relationship between India and
China
·
The reality is that both our countries have
worked hard over the last two decades to enhance dialogue in a number of fields
and we must maintain and build on that trend.
·
At the same time, it is true that divergences
persist, and that there is no denying the fact that we have a disputed border.
Table 3
|
Positives
|
Negatives
|
|
1. ‘Copenhagen
Spirit’: exemplary cooperation witnessed between India and China during the
Copenhagen climate change summit
|
1. China’s
angst over Dalai Lama’s visit to AP in 2009
|
|
2. Peaceful
borders
|
2. Stapled
visa issue cropped up in 2009
|
|
3. Huge
trade
|
3. Huge
trade deficit for India
|
|
4. Multilateral
cooperation: BRICS, BASIC, SCO, G20
|
4. Defence
ties were stalled
|
|
5. Cultural
cooperation
|
5.
|
|
6. Student
Exchange
|
6.
|
|
7. In
Sept 2011, India-China held their first even Strategic and Economic Dialogue
|
7.
|
Economic Relations
·
The two countries resumed trade officially in
1978
·
1984: signed the MFN agreemnt
·
China is India’s largest trading partner.
Accounted for a share of 9.09% in India’s international trade during 2009-10
o
10.69 % of India’s total imports were from China
in 2009-10 (largest)
o
China is the third highest destination for
India’s export accounting for 6.5% of the total
o
In 2009-10 total trade crossed $60 bn mark to
reach $61.7 bn.
o
India’s exports: Iron ore, other raw materials
and cotton
o
India’s imports: finished goods, mainly
machinery. There is a growing demand for Chinese telecom and power equipments
·
Set a target of reaching $100 bn trade by 2015
·
India has a trade deficit of over $20 bn with
China
·
Addressing the deficit problem
o
India has been pressing China to
provide better market access for Indian pharmaceutical and IT companies
which have struggled to penetrate the Chinese market
o
India is pushing for reduction of restrictions
on agri-products imposed by China so that India could export more agri-products
to it
o
In his December 2010 visit to India Wen Jiabao
said that China understands India’s concerns on the question of market access
and would try to find ways of resolving them
·
Indian companies in China
o
Manufacturing: pharma, autocomponents, laminated
tubes, refractories
o
IT and ITES: IT education, software solutions
o
Banking
o
Ranbaxy, Orchid Pharma, Dr Reddy, Aurobindo
Pharma, NIIT, Infosys, Suzlon, SBI, PNB etc
·
Chinese Companies in India
o
Power generation, machinery and infrastructure
construction, electronics, IT and Hardware manufacturing
o
Sinosteel, Shougang, China Dongfang
Internations, Sinohydro, Huawei, TCL, Haier,
·
Infrastructure
o
Still-well highway
Cultural Relations
·
1988: Agreement on Cultural Cooperation
o
Provides for an executive cultural exchange
programme (CEP)
·
Latest CEP signed in 2010
o
Provides for cooperation in a gamut of cultural
fields including exchanges of visits of performing artists, officials, writers
etc
·
2003: Centre for Indian Studies inaugurated in
Peking University
·
2008: 70th anniversary of Indian
Medical Mission to China
o
Chindia organised Joint Medical Mission to
commemorate the event
·
2010: Festival of India in China
·
India’s stall at World Expo
·
Structure adjacent to White Horse Temple
o
Inaugurated by Patil
Indian Diaspora in China
·
About 39000 people
·
HK has a larger Indian presence
·
Mainly students
Table 4
|
|
Binders/Opportunities
|
Separators/Challenges
|
|
Economy
|
Huge trade. Both are very large economies. Growth contributing to
global recovery
|
|
|
Int Fora
|
WTO – Doha round; Climate Change. At the world level fora,
India-China cooperation is quite evident.
|
At local fora and regional stability, India China are at divergence
|
|
|
BRICS; BASIC
|
|
|
Overall cooperation
|
Both stand to gain a lot
|
|
|
|
|
|
Premier Wen Jiabao’s visit to India
·
India-China to increase bilateral trade to $100
bn by 2015.
o
India’s main concern is the huge trade deficit
it has in trade with China
o
It has asked China to open up its IT and
services sector
·
They agreed to a strategic economic dialogue to enhance
macroeconomic policy coordination and address challenges in economic
development and cooperation
·
CEO’s forum shall also be created and greater
cooperation between the banking regulators of the two countries
·
Political Developments
o
Stapled visa for residents of J&K issue was
discussed. Wen proposed that the officials of the two countries should hold
consultations.
o
India did not mention Tibet and One China in the
joint statement.
·
Strategic
o
Agreement to work together against piracy in the
Gulf of Aden
·
Assessment
o
Incremental progress was made
o
We have areas of difference (border, stapled
visa) and cooperation (climate change)
March, 2012
India-China agree to undertake joint operations against
pirates and sharing technological knowhow on seabed research.
Joint operation against pirates seeks to involve the Coast
Guards, the navies and air forces in action against pirates.
The proposal to share technological knowhow on seabed
research is aimed at dousing India’s apprehensions after Beijing was permitted
by the International Seabed Authority to explore in south-west Indian Ocean.
Chinese foreign policy: String of pearls theory
·
The term ‘string of pearls’ is used to describes
the manifestation of China’s rising
geopolitical influence through efforts to increase access to ports and
airfields, develop special diplomatic relationships and modernize
military forces that extend from the South China Sea through the Strait of
Malacca, across the Indian Ocean, and on to the Arabian Gulf.
·
This strategy started in 1980s and its basic aim was to give
China increased energy security with refuelling stations throughout the world.
·
It has
also helped China project its political and military influences further.
·
Some of the recent additions to the pearl have
been the Hambantota
port in Sri Lanka and Gwadar
Naval Base in Pakistan
·
Karakoram Highway, connecting China’s Xinjiang region
with Pakistan’s north, can also be seen as one of the pearls
·
The implication has been that it has caused
great concerns for security in India, though China has tried to project it as a
purely economic and maritime security venture.
·
Though India has officially denied it, the
string of pearls strategy may influence
its relations with its neighbours
in the following ways
·
Myanmar
o
India shares a 1600 km border with it. It also
serves as a gateway for India to ASEAN and SE Asia
o
Bilateral trade between China and Myanmar
reached $2.9 bn in 2009 making China the second largest trade partner of
Myanmar (after Thailand)
o
The two countries have also agreed to build an
oil pipeline and a gas pipeline
·
Bangladesh
·
China-Africa Relations
In 1956, Egypt became the first African nation to establish
diplomatic relations with the PRC. As of 2010, only 5 of 54 African nations
maintain diplomatic relations with Taiwan.
From 1980s economic cooperation with Africa has assumed
greater importance for China.
Relations have been institutionalized through the Forum on China-Africa
Cooperation (FOCAC). Important milestones have been the ministerial
conferences in 2000,2003, 2009 and the ‘China’s Africa Year’ in 2006.
China’s
relations with Africa cover all facets – political, defence, economic
and other areas of cooperation. It has helped Chinese Navy to become more
assertive in the Western Indian Ocean.
Economic Relations
China-Africa Trade: valued at $10 bn in 2000. $107 bn in 2008
Over 1600 Chinese companies have investment of operational
presence on the African continent.
Seven special economic zones have been set up by China in
five African countries.
Issues
Critics: rise
of Chinese neo-colonialism. It economic policy damages Africa’s
development, delays industrialization, ruins local industry and does not
transfer technology. It supports dictatorships, corruption and a violation of
human rights.
Supporters: China largely doesn’t interfere in the internal affairs of the
countries. It has contributed to the enhancement of Africa’s importance
in world affairs as well as to rise in prices of African commodities and growth
of Africa’s GDP.
India
Though India has had historically a stronger relation with
Africa, in recent years, the gap between India’s and China’s profile in Africa
has been widening to India’s disadvantage.
India should closely monitor China’s activities in Africa
and intensify and broaden its cooperation with African countries selectively.
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