China was amongst the first countries to start treating Narendra Modi like a PM-in-waiting even before he had won his latest term in Gujarat. This was well before the Europeans beat a path to Gandhinagar, and years before America decided to reluctantly smell the coffee. There was prescience in the Chinese move to host Narendra Modi like a head of state in China. Done a couple of years ago, it was an acknowledgement and an intelligence assessment that was on target.
Is it any wonder then that China is on its way to overtaking the US as the biggest economy in the world even as there are natural apprehensions on its hegemonic tendencies? We are especially traumatised by our experience in 1962, at the bitter end of the Hindi-Chini-Bhai-Bhai era, but this could be potentially a very different world now.
India-China relations: 2014 can be great leap forward
Standing as a bulwark against Western manipulation together may work to benefit both India and China more than alternate scenarios. After all, the US-Chinese economic and diplomatic relationship continues strong, even as Chinese power and assertiveness, economic and military, keeps growing steadily. But first, the trust deficit between India and China must be bridged, and this can happen gradually in a cautious and calibrated manner, if we determine to do so.
But in 2014, should our fear of Chinese ulterior motives, the tensions on the borders, the blatant alliance with Pakistan, and help being given to some of our insurgents, turn us away from the opportunity for economic growth and betterment on offer? Can the economic opportunities be regarded separately from the other contentions? The present UPA Government seems to think so.
What, after all, have we really gained by our overtures and diplomatic leanings towards America and the West over many decades besides the George W Bush era Nuclear Power Deal? Things have gone into a semi-freeze thereafter during the Obama years, and China has given practically the same deal to Pakistan alongside.
Some defence analysts state that Pakistan’s nuclear arsenal is actually bigger and better than ours, and Indian access to nuclear fuel and high technology has not, in fact, improved dramatically. Bush and the Republicans might have wanted to create an unequivocal Indian ally, but there has been some revision in the thinking of the Democrat-run US since. The EU, Japan, Australia and the rest must therefore follow suit, if in a muted fashion.
An economic cooperation with China now, and the consequent mutuality, may thwart some American globocop ambitions in the Indian Ocean, the Pacific and South Asia, but need not necessarily put India at increased military risk. Besides, these tilts tend to engender healthy competition from other ‘providers’ that could benefit both countries. Besides, it must be noted realistically, that all our neighbours are already on board the Chinese omnibus.
Now China, with trillions in investible funds, has said it wants to invest $300 billion, an estimated third of the present requirement, to create, upgrade or modernise our quaint infrastructure. This is the biggest offer that has come to India from any country in the world. Currently, China has a strong balance of trade surplus of around $40 billion in its favour, but a miniscule share of just 0.15 per cent of India’s FDI inflows between April 2000 and December 2013. There are plans to ramp up bilateral trade between our two countries to $100 billion by 2015, but this cannot come about without some bold initiatives being taken.
On infrastructure, the Chinese have offered to work in Telecom, Nuclear Power, Solar and Hydel Power, Railways, Roads, Sewage Treatment, Tunnel building etc. as well as in agro-processing and manufacturing. They are particularly keen on transforming our Railways with enhanced electrification, high-speed trains, modern wagons, last-mile connectivity and gauge conversion. This should surely be welcomed by the incoming Government, because the once proud Railways, amongst the most elaborate in the world, is now out-dated, inadequate, over-burdened and notoriously unsafe.
India needs to catch up with China’s Brahmaputra strategy
The Indian Railways however, remains a major employer, and is of enormous strategic importance because it links the length and breadth of the country. That it gets a separate Budget presentation every year speaks for itself. It therefore merits the Government’s urgent attention to arrest its terminal decline, particularly as it is also rapidly losing money. A recent CAG audit puts the loss figure at over Rs 1,155 crore between 2010-2013 in engineering and operations alone. This is a tremendous comedown for one of India’s proudest institutions which was once a major revenue earner for the nation. With no money being self-generated to spend on modernisation, safety, comfort and capacity enhancement, the Railways are being slowly abandoned by both passengers and freight whenever possible.
While the fulsome Chinese offer has come in the dying days of the UPA dispensation, in which very little actual progress can be expected, it needs to be taken up promptly by the incoming Government. China is undoubtedly one of the most adept manufacturing nations in the world and also has stellar infrastructure development experience under its belt, both at home and abroad.
With $3.8 trillion in reserves and counting, it is already contributing to the development of the South Asian region — in Pakistan, Sri Lanka, Nepal, Myanmar, and extensively in parts of the African continent as well. We must therefore take a fresh look at our suspicions and induct Chinese expertise and money in a phased manner as this kind of economic engagement tends to also go a long way to ease tensions and promote trust. If the West is interested in the Indian market opportunity on favourable terms, then why not the Chinese?
Soft India can’t tame tough China
The scale of the offer is indeed unprecedented, and dwarfs our economic engagement with the West and Japan too. The Japanese, who have recently financed some of our infrastructure projects, have only invested a fraction of the Chinese offer. That too, over the years, inclusive of the Delhi Metro and the work ongoing in the Delhi-Mumbai Industrial Corridor.
The Chinese offer is also in harmony with Narendra Modi’s stated dream to develop India on fast-track to catch up to China by 2020. NaMo reportedly wants to provide 24×7 Power throughout the nation as a spur towards this objective. He has repeatedly stressed that employment generation is a top priority in this country with its huge demographic dividend. He wants to enhance employment by promoting big and medium industry, the IT, financial, and other service sectors, the backbone of infrastructure and the initiative of entrepreneurship across the board.
The roads in some parts of the country may be fairly good now thanks to the Vajpayee Golden Quadrilateral initiative, but in other parts of the nation they remain quite basic or practically non-existent. This road sector alone can be viewed as a metaphor for all the work that remains to be done. Infrastructure development such as this, on multiple fronts, in a new phase of dynamic activity, will boost the GDP to near or above 10 per cent per annum by itself, and open up a wealth of unprecedented opportunity for everyone.
China recognises NaMo as future PM | Niti Central
