India & China: Resetting relations

The informal meeting between Prime Minister Narendra Modi and Chinese President Xi Jinping in Mamallapuram presents an occasion to understand the two countries’ concerns and to address important issues relating to trade and investment.

Published : Oct 29, 2019 07:00 IST

Prime Minister Narendra Modi and Chinese President Xi Jinping in Mamallapuram on October 11.

Prime Minister Narendra Modi and Chinese President Xi Jinping in Mamallapuram on October 11.

Both India and China have described the second “informal summit” meeting between Prime Minister Narendra Modi and Chinese President Xi Jinping near Chennai in the second week of October as more significant than the bilateral meetings that they held in the past. The two leaders had six hours of direct talks in the course of two days at the summit. Xi, hailing the success of the talks, invited Modi for another informal summit in China next year. Modi was quick to accept the invitation.

Modi, speaking before the delegation-level talks between the two sides, said both countries had decided “to be sensitive to each other’s concerns”. Xi reciprocated by stating that the “informal summits have produced visible progress” in bilateral relations. “We have deeper strategic communication, more diverse people to people and cultural exchanges, and closer cooperation on multilateral occasions,” he said.

The first “informal summit” between the two leaders was held in the Chinese city of Wuhan in March last year. The Modi government was anxious at the time to extricate itself from the diplomatic and military quagmire it had got itself into in Doklam. The Chinese government was upset when India chose to escalate a minor boundary dispute between China and Bhutan into a military standoff that lasted for 73 days in 2017. The long-running Doklam incident took place at a time when the Chinese Communist Party was busy preparing to celebrate its centenary in a big way.

Indian diplomats had to work overtime to allay Chinese anger and persuade the Chinese leadership to agree to the summit meeting in Wuhan. A “reset” in relations was announced and normalcy restored in bilateral relations. Modi said the Wuhan summit had led “to a new momentum and trust” between the two countries and that the “Chennai connect” would herald the start of a new era in cooperation between the two countries.

The Xi-Modi meeting in Mamallapuram, a coastal town just 50 kilometres from Chennai, is a follow-up to the Wuhan summit held last year. It is a port city founded in the fourth century CE and had trading and cultural links with China. Communist China’s first Prime Minister, Zhou Enlai, had visited the place in 1956. But those were the days of “Hindi-Chini bhai bhai”, when relations between the two countries were warm and cordial.

A statement issued by the Indian External Affairs Ministry after the end of the two-day summit in Mamallapuram said the two sides “reiterated the consensus reached during the first summit at Wuhan” last year. “India and China are factors for stability in the current international landscape and … both sides will prudently manage their differences and not allow differences on any issue to become disputes,” the statement said. It said the two sides recognised that both countries had “a common interest in preserving and advancing a rules based international order, including through reforms that reflect the new realities of the 21st century”.

Both countries have been signalling their displeasure at the unilateral trade moves made by the Donald Trump administration. The Indian statement said that the two leaders agreed that “it is important to support and strengthen the rules based multilateral trading system at a time when globally agreed trade practices and norms are being selectively questioned.” The statement by the Indian External Affairs Ministry also said that the two countries pledged to make joint efforts to ensure that the international community “strengthens the framework against training, financing and supporting terrorist groups” throughout the world and on a “non-discriminatory basis”.

Kashmir ‘not discussed’

Foreign Secretary Vijay Gokhale claimed that the Kashmir issue “was not raised or discussed” at the summit but admitted that Xi briefed Modi about the talks he had with Pakistan Prime Minister Imran Khan, who was in Beijing just before the Chinese leader embarked on his trip to India. Imran Khan had extensively briefed Xi on the Kashmir issue. Gokhale said that Modi only “listened” to what Xi had to say on Imran Khan’s visit.

Gokhale announced that the two sides agreed to set up “a new mechanism” to discuss matters relating to trade and investments “at an elevated level”. He told the media that the two leaders had “a good conversation” on trade, which he said was a “matter of concern” for India. According to him, Xi told Modi that Beijing was ready to take “sincere action in this regard and discuss in very concrete ways how to reduce the trade deficit”. Finance Minister Nirmala Sitharaman will hold regular consultations with Chinese Vice Premier Hu Chunhua. India has a huge trade deficit with China, currently standing at $57 billion.

China wants to boost its trade ties with India through the auspices of the Regional Comprehensive Economic Pact (RCEP), a free trade agreement among 16 nations. Besides the Association of Southeast Asian Nations (ASEAN) countries, China, Japan, South Korea, New Zealand and Australia are members of the group. The region is home to more than half the world’s population. The pact has been held up because of some misgivings on India’s part. The ASEAN countries and China are putting pressure on India to sign up. There is countervailing pressure from the United States, domestic manufacturers and trade union movements on the Indian government to stay away from the RCEP.

The Trump administration is openly applying pressure on India to keep the Chinese telecom giant, Huawei, out of the 5G bidding process. Huawei has the best and the cheapest 5G technology on offer. If India does not allow Huawei to compete in the bidding process, despite the fact that many Indian service providers are batting for it, the Chinese side will have reasons to be upset.

However, the Indian government is more or less committed to joining the RCEP before the end of the year. According to Gokhale, Modi “specifically” indicated to Xi that India was looking forward to be part of the RCEP, expressing the hope that it would be a “balanced” agreement that took on board Indian concerns. According to Gokhale, Xi gave an assurance that Indian concerns would be taken into consideration. Gokhale also said that both sides stressed the importance of following “independent and autonomous foreign policies”. Xi emphasised the need for more engagement between the two countries in the defence and security arenas to enhance mutual trust between the militaries of the two countries.

The Chinese side did not bother to issue a lengthy statement on the talks like the Indians did. However, Xi said that he had engaged in “candid discussions” with Modi on wide-ranging issues. “Under the current international situation, both China and India should shoulder increasingly important responsibilities in maintaining stability and promoting development. The next few years will be a crucial period for China and India to achieve national rejuvenation and a crucial period for the development of Sino-Indian relations,” Xi told the Chinese media.

The still lingering diplomatic tensions between India and China were apparent as the countdown for Xi Jinping’s visit started. The Indian side was kept on tenterhooks until the eleventh hour about the visit itself materialising. The visit of the Chinese President was confirmed only two days before the scheduled dates. The Chinese side was particularly unhappy about the timing of the Indian Army’s military exercises in Arunachal Pradesh, which started in the first week of October. China has claims on large parts of Arunachal Pradesh.

This time, the Indian Army chose to have its exercises just 100 kilometres from the Line of Actual Control (LAC). The Army announced that the exercise, to test its high altitude “new war strategy” against China, was the first of its kind. The terrain in which these exercises were held is situated at an altitude of around 14,000 feet. The war games, codenamed “Him Vijay”, are scheduled to go on until the last week of October. The military drills, according to the Indian side, are essential to test the capabilities of the newly formed Integrated Battle Groups (IBG). The Indian Army had carried out a similar exercise in Ladakh in September. The exercise came a few days after a brief face-off between Indian and Chinese soldiers along the disputed border in Ladakh.

The Indian side is unhappy with the proactive role China is playing in the Kashmir dispute. Beijing had issued a strong statement criticising the Indian move to change the status of Jammu and Kashmir and had taken the initiative to call for an informal United Nations Security Council meet on the issue in August. This was the first time since 1991 that the Security Council convened to discuss the issue. China had also stated that the designation of Ladakh as “a Union Territory” was unacceptable to it. China has territorial claims in Ladakh. “China always opposes India’s inclusion of Chinese territory in the western section of the China-India boundary under its jurisdiction,” a Chinese Foreign Ministry spokesperson had stated in August.

Ahead of his visit to India, Xi once again reiterated that China was paying “close attention” to the Kashmir issue and that China supported Pakistan’s efforts to protect its “legitimate rights”. The remarks came during the official visit by Imran Khan to Beijing. The visit, at the invitation of China, had taken place a few days before Xi’s departure to India. Xi said that China and Pakistan should support each other. “China and Pakistan enjoy a unique all-weather strategic partnership. No matter how much the geo-political situation changes, the rock-solid friendship between China and Pakistan is unbreakable,” said Xi after his meeting with Imran Khan.

In the joint statement issued after the visit, the two sides reiterated that the Kashmir issue should be “properly and peacefully resolved based on the U.N. Charter, relevant U.N. Security Council resolutions and bilateral resolutions”. Chinese officials suggested that the changing of the status quo in Kashmir by the Indian government would have an adverse impact on the security situation in the region. The Indian External Affairs Ministry spokesperson was quick to react, saying that China was well aware of India’s position that Jammu and Kashmir was an integral part of the country. “It is not for other countries to comment on the internal affairs of India,” he said.

India’s military links with the U.S.

China, on its part, is unhappy with India’s growing strategic and military links with the U.S. India has been supportive of the U.S.’ Indo-Pacific strategy. India and the West are on the same page on the South China Sea issue, refusing to acknowledge China’s territorial claims. The annual Malabar military exercises conducted by the U.S., Japanese and Indian navies are another irritant in bilateral ties. This year’s Malabar exercises were held off the coast of Japan from September 26 to October 4. Japan and China are embroiled in a territorial dispute of their own. China views the Malabar exercises with a great deal of suspicion.

The Trump administration prefers to use the term Indo-Pacific instead of Asia Pacific for the region. It is a signal that Washington wants India to play a more significant role in the anti-China alliance it wants to cobble together. India is part of the Quadrilateral military grouping led by the U.S. The other two members of the so-called “Quad” are Australia and Japan. The Quad has a “China-centric” security agenda. Quad members claim that they are committed to a “rules-based order in the Indo-Pacific”, implicitly suggesting that China wilfully flouts international law.

The Foreign Ministers of the four countries met on the sidelines of the U.N. General Assembly in September and “reaffirmed their commitment to shared values and cooperation on maritime security, infrastructure and connectivity and in support of a rules-based framework”. India, in an effort to address some of China’s misgivings about the Quad, has so far vetoed Australia’s participation in the Malabar exercises.

India remains the only country in the region that has opted to stay out of China’s Belt Road Initiative (BRI). In fact, India has joined the U.S. and its allies in their criticism of the BRI initiative. India’s main objection is that the China Pakistan Economic Corridor (CPEC), a key component of the BRI, passes through a sliver of territory claimed by India. India also agrees with the West that the BRI lacks transparency in its funding deals. More than 126 countries have signed on to the BRI. Xi, in fact, left for Nepal directly from Chennai on a state visit, the first by a Chinese President in 22 years. He is expected to sign important economic deals, including a deal that would establish rail connectivity between Kathmandu and Tibet. Nepal, until recently, was viewed to be totally within India’s sphere of influence. Things have changed dramatically in the Indian subcontinent. India is now forced to team up with the U.S. to stave off Chinese influence in the region.

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