The visit went well on every count, and gaffes from the past are forgotten. Yet, concerns over economic issues, and wariness over U.S. moves, leave some question marks.
ATAL BEHARI VAJPAYEE'S visit to China, the first by an Indian Prime Minister in 10 years, has been hailed in both the countries as a success. Although no path-breaking agreements were signed, significant steps were taken to improve relations further and solve the long-standing boundary dispute. In the Declaration signed by the two countries, both sides agreed to use Nathu La, the pass, in Sikkim as the point of entry for border trade. China did not explicitly recognise Sikkim as being a part of the Indian state, but the formal beginning of border trade through Sikkim is a tacit acknowledgment of the Indian position.
The activities of the Tibetan groups in exile in India have constituted a major stumbling block to normalisation of Sino-Indian ties. Beijing will watch the steps that India will take to curb the activities of the extremists among the Tibetan exile groups. Indian officials have said that there has been no change in the Indian government's position on Tibet. Another important development was the appointment of two special representatives to expedite the solution to the boundary dispute.
A few commentators have sought to interpret the "joint statement" as a capitulation by the Indian government to Beijing. However, all the political parties have welcomed the outcome of the visit. The Communist Party of India (Marxist) has observed that it is the first time that the two countries have signed a joint declaration. The party noted that it emphasised that the "two countries are not a threat to each other". This sentence should reassure those in India who view China as a long-term threat to India's security.
Ahead of his trip to China, Vajpayee told the leading Chinese newspaper Wen Huibao in an interview that both India and China had shared views on important issues, including "the desire to strengthen multi-polarity in international relations''. He emphasised that there was no "objective reason for discord" between the two countries. Vajpayee clarified that India's nuclear programme was a "defensive" one and not one directed against any country. A letter that Vajpayee sent to U.S. President Bill Clinton after the 1998 Pokhran nuclear tests, naming China, had done considerable damage to Sino-Indian relations.
After the latest visit, all that seems to be a closed chapter. Defence Minister George Fernandes and External Affairs Minister Yashwant Sinha, during their visits to China, had made diplomatic amends for the political gaffe committed in May 1998. Earlier in 2003, the Chinese Prime Minister told the visiting Indian Defence Minister in Beijing: "99.9 per cent of the time in history the two countries lived in peace and friendship, China and India should further strengthen such friendly ties".
Vajpayee had sent the right signals to Beijing before going there. He told the Chinese newspaper that India is actively encouraging bilateral trade and economic cooperation. "We welcome Chinese companies in India for trade and investment," he said. China had been unhappy with the Indian government's attitude with regard to economic issues until last year. Chinese officials felt that their industries were being unfairly targeted in India. Some Chinese companies operating in India were under scrutiny. Chinese professionals wishing to work in India had to renew their visas every couple of months. On the ground of national security, some companies were denied contracts they had legitimately bid for. A contract for the desilting of the Mumbai harbour is an illustration. Two Chinese companies were denied the contract after the Indian side invoked national security laws. In 2002, not a single Chinese proposal for investment in India was approved. Out of 30 anti-dumping suits filed by India, 14 were against Chinese companies. The Indian government went to the World Trade Organisation (WTO) to file a case against a Chinese company selling industrial sewing machine needles in India. India has since withdrawn the proceedings.
In this context, China's decision, announced during Vajpayee's visit, to set up a $500 million corpus for investments in India has considerable symbolic significance. It was announced during Vajpayee's visit that both the sides have set a trade target of $10 billion by 2005. Bilateral trade last year amounted to $5 billion. That figure represented a growth of 38 per cent over the previous year. A good pace of growth rate has been maintained in the first quarter of this year.
Cooperation between India and China in the WTO has received a fillip. Soon after the Prime Minister's return from China it was announced that India would approve China's accession to the Bangkok Agreement facilitating tariff concessions on various items traded between the two countries. The Bangkok Agreement signed under the auspices of the Economic and Social Commission for Asia and the Pacific (ESCAP) is a preferential tariff agreement meant to promote intra-regional trade. China has been stressing the point that economic relations between the two countries should be given priority. It feels that the strengthening of economic ties will help clear the other hurdles. Beijing today has good relations with Russia and Vietnam, two countries with which it had serious border problems.
China has been wary of some of New Delhi's recent diplomatic moves. There are many in China who argue that the U.S. would seek to use its relations with India to counterbalance China. It is no secret that the "neo-conservatives'' in the Bush administration want India to play an important role in the long-term American military strategy of encircling China. Before September 11, the Bush administration was mainly focussed on China. India's decision to support promptly the Bush administration's National Missile Defence (NMD) policy was not taken kindly by Beijing. China feels that the NMD programme is specifically targeted against it. Missile defence will not be effective against a country like Russia that has thousands of inter-continental ballistic missiles (ICBMs). China, on the other hand, has only around 18 ICBMs. Beijing also interpreted the Indian government's prompt welcome of the NMD programme as an attempt to put itself under the U.S. military umbrella, like Japan and Taiwan. Vajpayee, however, reassured the newspaper Wen Huibao that India does not seek to develop relations with any country to "counterbalance" another country.
Beijing is also watching the Indian government's moves on Iraq. It is pointed out that New Delhi will be sending the wrong signals to Beijing if it decides to send troops to Iraq. China as a United Nations Security Council member has remained opposed to the military action taken by the U.S. and the United Kingdom in Iraq. China wants the choice of the Iraqi people to be respected along with the national concerns of the surrounding countries. Above all, Beijing wants the leading role of the U.N. to be respected.
Washington is no doubt keeping tabs on the developments on the Sino-Indian front. It is aware that if India and China cooperate, the chances of a multi-polar world emerging in the near future will be enhanced. Both New Delhi and Beijing share a perspective on terrorism. China too is faced with certain forms of terrorism in Xinjiang, Inner Mongolia and Tibet. There have also been indications that the "all-weather" relations Beijing has with Islamabad is under strain. For all practical purposes, after September 11 Pakistan has become an American military appendage. Beijing has for some time taken a more even-handed stance on India-Pakistan issues. China was neutral on the Kargil issue and has been consistently urging India and Pakistan to solve the Kashmir issue bilaterally.
The former Prime Minister of Russia, Yevgeny Primakov, was the first to propose the idea of a Moscow-Beijing-Delhi triangle. At that time, both China and India appeared to be uninterested in the idea. The Chinese side is still of the opinion that there is no need for a formal axis. Relations between Beijing and Moscow are excellent and are comparable to Indo-Russian ties. Russian Foreign Minister Igor Ivanov recently said that Russia would work for trilateral interaction with India and China for the sake of global stability. He expressed the hope that Vajpayee's visit would strengthen relations in the Russia-India-China triangle. Beijing, like New Delhi, would prefer to adopt a policy of "strategic ambiguity" in its foreign policy for now. However, China considers the U.S. to be a country that is out to establish its hegemony at the expense of the national interests of other countries. China has no illusions about the long-term goal of the U.S. - which is to prevent it from ever emerging as a superpower.
After Vajpayee's return, the Indian Navy announced that the first-ever joint exercises with the Chinese Navy were being planned this year. These will be in the form of search-and-rescue operations in the high seas off India's eastern coast. Both sides have taken a conscious decision to improve bilateral military ties. The Chinese military has an important say in issues relating to the Sino-Indian boundary dispute. The former Chinese President, Jiang Zemin, continues to be the chairman of the Central Military Commission. Vajpayee met him in China. Defence Minister Fernandes too had called on him earlier this year. The impression persists in Beijing that the Prime Minister's visit was a hurried one and that sufficient paper work was not done by the Indian side to make the visit even more meaningful.
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