Welcome to today’s newsletter.
I hope this finds you well wherever you are. There seems to be no light yet at the end of the tunnel for India in this horrifying second wave. As I mentioned in the last newsletter, it is very difficult to try and think about other issues in this current time. Here is hoping we pull through and come out of this soon, and my best wishes to all readers.
In this issue, I'll be looking at:
- Xi's speech at the Boao forum
- His invocation of the BRI's "rules and standards" and the emerging sharp contrast with what the Quad is pushing
- India's envoy in Beijing and China's envoy in Delhi, speaking at the same dialogue, offer two very different takes on the state of relations, from the border to multilateral groupings
- China's economy rebounds, and how
- And finally, a delightful 5 year old Hindi/English/Mandarin speaking dancer winning hearts in China
I reported in today’s The Hindu (partial paywall) on Xi’s speech at the Boao Forum - China’s Davos - yesterday. These comments caught my attention:
On Tuesday, Mr. Xi said, “We must not let the rules set by one or a few countries be imposed on others, or allow unilateralism pursued by certain countries to set the pace for the whole world.” “What we need in today’s world is justice, not hegemony. Big countries should behave in a manner befitting their status and with a greater sense of responsibility,” he added.
He said China would continue to take forward its Belt and Road Initiative (BRI), including for joint vaccine production that had begun with BRI partners including Indonesia, Brazil, the United Arab Emirates, Malaysia, Pakistan and Turkey. With a push to deepen connectivity, he said China will “promote ‘hard connectivity’ of infrastructure and ‘soft connectivity’ of rules and standards”.
You can find the full text of the speech here.
COMMENT: It is interesting he flagged vaccines and rules and standards, two issues that the Quad leaders summit last month devoted a lot of attention to. The Quad decided to set up a Critical and Emerging Technology Working Group that will “facilitate coordination on technology standards development, including between our national technology standards bodies and working with a broad range of partners”, among other things. You can find details of the vaccine initiative and the technology group here. Note also that President Biden recently spoke to Boris Johnson about coming up with a BRI alternative. Are we seeing the start of a gradual emergence of, to use the phrase that’s flavour of the moment, two rules-based orders?
On a somewhat related note, an interesting read in The Economist on how Indian and Chinese investors operate very differently abroad, in this piece is reported from Zambia and Kenya:
Many Zambians, like people in many other developing countries, complain loudly and often about the Chinese firms that are big local investors. India is also a big commercial presence but no one bats an eyelid. Tata Motors has huge assembly plants in many countries, including South Africa and Malaysia. Bharti Airtel is one of the biggest telecoms operators in Africa. The Aditya Birla Group is the world’s largest producer of carbon black, an ingredient in car tyres. It is one of Egypt’s biggest industrial investors and exporters.
Even in sectors governments deem strategic, such as infrastructure and communications, Indian foreign direct investment (fdi) is not viewed as geopolitical scheming or hegemonic ambition. “That’s one of the selling points for India,” says Gareth Price of Chatham House, a British think-tank. “With the obvious exceptions of Pakistan and China, everyone is kind of all right with India.”
[One] reason Indian investment tends to arouse less resentment than that from China is that Indian companies have a largely justified reputation for trying harder than the Chinese to hire and buy locally. In 2006 the World Bank surveyed almost 450 businesses in Africa. On average, Chinese firms employed almost a fifth of their workers from China and other East Asian countries, whereas Indian firms brought less than 10% of their workers from India. The Chinese businesses imported 60% of new machinery from China; their Indian peers bought just 22% from India. That trend continues today, says Harry Broadman, the economist who led the research.
Two interesting speeches, at the same dialogue last week, from India’s Envoy to China Vikram Misri, and China’s Envoy to India, Sun Weidong — interesting in what each emphasised, and how different the takes were.
Misri had this to say about the border situation:
In the interim, pending its ultimate resolution, the two countries worked out elaborate mechanisms and parallel structures for border control and for the management of issues that cropped up on the ground on a regular basis. Though they were tested on multiple occasions, these mechanisms and structures helped maintain the all important peace and tranquility on the borders, thereby helping create the environment in which the India-China relationship grew spectacularly between 1988 and 2019. I emphasize this point to underline the fact that the relationship did not grow autonomously but as a result of conscious policy choices that nurtured an environment for its growth.
It is tempting today to remember this period with a touch of nostalgia, and to argue that we should shelve our differences and things should immediately go back to the way they used to be. But we must acknowledge that these enabling structures and the fundamental premise of the closer developmental partnership have been placed under considerable strain by the serious incidents and the resultant violation of peace and tranquility at the Line of Actual Control in Eastern Ladakh in April 2020 and thereafter. The impact on public opinion has been particularly strong. In this context, it has often been pointed out by friends in China that we should stick to the consensus between our leaders. I have absolutely no quarrel with that. Indeed, I agree wholeheartedly. At the same time, I should point out that equally significant consensus has been reached between our leaders in the past as well, for instance the consensus that I just referred to on the importance of maintaining peace and tranquility, and it is important to stick to that consensus as well. We have also seen a tendency in some quarters to sweep this situation under the carpet and characterize it as just a minor issue and a matter of perspective. This too is inadvisable as it can only take us further away from a sustained solution to present difficulties and deeper into an unfulfilling stalemate. In fact, it would be tantamount to running away from the problem and in a direction opposite to that where the promise of our closer development partnership lies.
Sun had a different take:
What happened over the past few decades has proven once and again that highlighting differences will not help resolve problems. Rather, it will erode the foundation of mutual trust. The boundary dispute is a reality and should be given sufficient attention and taken seriously. However, the boundary question is not the whole story of China-India relations and should be put at a proper place in the overall bilateral relations. The two sides should engage in dialogue on an equal footing, manage differences and find solutions through consultation. We should not allow differences to become disputes…
Their views on multilateralism differed too.
Sun had this to say, coming after lots of recent Chinese criticism of ‘small circles’ and the Quad in particular….
We should never interfere in each other’s internal affairs. It is imperative to uphold independence, oppose hegemonism and power politics in any form, and reject zero-sum game and the Cold War mentality. We need to work together to build a big community of “universal peace”, and reject “small circles” of closeness and exclusion targeting other countries.
Misri was quite direct on this and it’s quite clear who he had in mind:
We have also long been vocal in our support on the world stage of an inclusive order and the values of multilateralism. However, if we wish to cope effectively with the challenges of the evolving international scene, it is clear that only statements in favor of multilateralism will not be sufficient. We must remember in any case that multilateral structures are presently under some stress and have therefore created space for a number of plurilateral initiatives, which essentially represent efforts by groups of interested actors who share common objectives and believe they can jointly deploy their resources for the achievement of those objectives. Examples of such initiatives can be found in all corners of the world and it is important to afford space to them rather than prejudge them.
At the same time, it is also important to recognize that in a post-pandemic world of altered equations, multipolarity is probably more important than ever, both in the Indo-Pacific and beyond. In a multipolar world, no country can set the agenda by itself without prior agreement and consultation, and then expect everyone else to come on board. No single country can expect a discussion to focus only on issues of its own interest while ignoring those raised or reflected by others. And no country should imagine that it has sole control over the narrative about a relationship or its actual course. The sooner this is understood, the sooner we can move towards a real and reformed multilateralism. And it goes without saying that, no matter the domain, multilateral, plurilateral or bilateral, words are important but they also need to be backed up by actions. So we will certainly be listening to the words, but more importantly, we will also be watching out for the actions.
The PLA, meanwhile, has been busy on the borders. From the South China Morning Post:
The People’s Liberation Army has deployed an advanced long-range rocket launcher to the Himalayas, in a move aimed at reinforcing China’s border defence and acting as a deterrent to India, according to a military mouthpiece and analysts. It is the first time that the PLA has confirmed the deployment of long-range rocket systems to the border with India, after the neighbours last week failed to reach agreement in their latest round of corps commander-level talks over full disengagement along the disputed frontier.
An artillery brigade stationed 5,200 metres (17,000 feet) above sea level in Xinjiang military district has intensified its drills using a rocket system during full-wing combat-ready training, a report on the front page of PLA Daily said on Monday. The report did not give the type or firing range of the weapon, but said it was a system with a long-range rocket with precision strike capability, and had entered service in 2019.
Last July, reports from Indian media outlets said China had deployed advanced weapons systems to border areas in the high-altitude desert in its northwest, and the Qinghai-Tibet Plateau in its southwest, including the Type PHL-03 multiple launch rocket system (MLRS), which has a firing range of 70 to 130km, and PCL-181 vehicle-mounted howitzers. But experts said the PHL-03 and PCL-181 were not new advanced weapons, with their ranges being too short to pose a threat.
“The new weapon system should be a long-range rocket launcher that can carry multiple 300mm [12-inch] or even bigger rockets with more than 100km of firing range,” said military commentator Song Zhongping, a former instructor in the PLA’s Artillery Corps, the predecessor of Rocket Force. “Only a long-range MLRS is powerful enough to act as a deterrent to India, as the Indian troops are also stepping up military deployment along the borders.”
Another interesting border development, from the Hindustan Times:
China’s military has stepped up efforts to recruit more Tibetans amid the dragging border standoff with India on the Line of Actual Control (LAC), holding special recruitment drives across Tibet Autonomous Region since the beginning of the year, people familiar with developments said.
People’s Liberation Army (PLA) officials have criss-crossed the Tibet Autonomous Region to hold recruitment drives and to pick up Tibetan recruits who were already at PLA camps, the people cited above said on condition of anonymity.
There are also reports the PLA intends to create a Special Tibetan Army Unit, the people said, citing intelligence reports and communications intercepts from three separate intelligence agencies. If this were to go ahead, this would be the first PLA formation comprising soldiers from a specific ethnicity, the people added.
PLA officials from Lhasa visited Rudok town in Ngari Prefecture in the far west of Tibet Autonomous Region (TAR) in the third week of February to recruit Tibetans as soldiers, according to an intelligence report. These officials later travelled to Zanda or Tsamda County, one of the border counties of TAR to select Tibetan recruits from several PLA camps for possible induction into the special unit, the report said.
India’s Covid-19 situation has been a trending topic in China. Tian Guangqiang of the Chinese Academy of Social Sciences in this commentary reflected what seems, to me, to be the broad sentiment in some of the media in how it’s being seen in the context of recent relations with China:
In recent years, India has tried to promote an economic decoupling from China. It wants to borrow the power of the US and other countries to contain China, and it has been increasingly tilting toward a dangerous direction after the border conflict with China last year. India has banned more than 200 apps in China, and has increased discriminatory restrictions or even inciting economic nationalism against Chinese companies and investments.
Such moves might not be as helpful to local industries as some in India might think. If India loses its credibility in building and maintaining a fair and open business environment in cracking down on Chinese companies, it will also send chills among foreign investment and business from other countries, which will undoubtedly make India's economic recovery even more difficult.
India's decoupling path has obviously proven to be a mistake. China, as an important neighbor with a massive manufacturing sector and consumer market, is of great significance for India's industrial development.
The fault of India's decoupling policy is to ignore its economic needs and blindly serve its politics. New Delhi should embrace economic cooperation in accordance with economic needs, and should not politicize the livelihoods of its citizens. Decoupling will not only fail to succeed, but will also harm India's own industrial development in the long run.
India is currently at a critical juncture. If the country wants to get out of the predicament, it needs to actively promote cooperation with other emerging economies, including China, in fighting against virus and boosting economic recovery, rather than continuously playing geopolitical games.
A reality check from Sushant Singh in this Stimson briefing paper on India’s two-front challenge, which is worth reading in full:
The military was never resourced accordingly, however, leaving open serious vulnerabilities. Despite recent improvements in India-China and India-Pakistan relations, the two-front military threat remains a formidable challenge with no easy answers. India does not have the economic wherewithal to resource its military to fight a two-front war. The alternative—seeking partnerships with other powers to externally rebalance—will also prove difficult, given that the Quad initiative is still in its early stages and cannot provide reliable protection as of now. The smartest choice for New Delhi, therefore, is to neither fight nor prepare to fight a two-front war. Instead, India should seek durable and enduring peace with one of its adversaries. Since China remains a long-term strategic competitor and permanent peace with Pakistan is at odds with the dominant political ideology in New Delhi, however, the Indian military is likely to remain in an unviable position: resource-constrained, overstretched, and vulnerable.
On the recent China Bhutan border talks, which have taken place after quite a gap, Lin Minwang had this to say to the South China Morning Post:
Lin Minwang, a professor at the Institute of International Studies at Fudan University in Shanghai, said the boundary talks would provide a mechanism for China and Bhutan to maintain high-level exchanges, since India prevented Bhutan from engaging more closely with China.
“These boundary talks are a way for them to maintain dialogue and exchanges,” he said. “The backdrop this time is similar, for them to continue engaging, maintaining communication and confirming whether their stances on the issue have changed. “Over the past two years, because of the Doklam stand-off, India’s control over Bhutan has grown more strict, so Bhutan is in a very delicate position as well.”
An update on China’s continuing economic rebound, from the Washington Post:
China’s National Bureau of Statistics announced on Friday that the economy grew by 18.3 percent in the January-March quarter compared with a year earlier, when the coronavirus disrupted business across the country.
Economists predict the United States is also returning to pre-pandemic levels of economic activity this year, although at a slower trajectory than China. Europe, Japan and many other countries will struggle to make this full recovery in 2021, according to PIIE forecasts.
China’s double-digit headline growth looks deceptively large because of the base effect: It is calculated against the first quarter of 2020, when China registered a 6.8 percent economic contraction during the pandemic. Compared with pre-pandemic levels, China’s economy has still grown, but not at such a breathtaking rate.
Exports rose 38.7 percent during the quarter while total value of sales of commercial buildings jumped 88.5 percent from a year earlier, official data showed. The industrial and service sectors both made strong recoveries. China has set a full-year 2021 economic growth target of more than 6 percent, a goal that economists call conservative.
Although China was able to control the domestic spread of the coronavirus faster than Western nations, it faces a more drawn-out battle against the virus. With four times the number of people to vaccinate compared with the United States and less-effective vaccines than the West, China is unlikely to reach herd immunity at home this year.
Localized lockdowns in response to new virus clusters will continue to weigh on China’s economy, while strict border controls will dampen tourism and business travel.
The Wall Street Journal reports on Tesla’s latest China troubles:
A single protester with a disputed claim about the safety of Tesla Inc. electric vehicles has hit a nerve in China, sending complaints about the company ricocheting across the Chinese internet and refocusing attention on alleged quality issues in a critical market for Tesla.
The woman climbed atop a Tesla Model 3 sedan at the Auto Shanghai expo on Monday, shouting allegations about faulty brakes on Tesla vehicles while wearing a T-shirt that read “The Brakes Don’t Work” and “Invisible Killer.”
Videos uploaded by visitors then showed her being dragged away by security guards, who had previously attempted to use open umbrellas to hide the woman from onlookers. When the Journal visited the Tesla stand later on Monday morning, the company had beefed up security.
The protest at the Tesla booth, a rare public display of defiance in China, was picked up by state media outlets and quickly went viral on the Chinese internet. Within a few hours, more than 150 million people had viewed a hashtag of the incident on China’s Twitter -like Weibo platform, remarking on how Tesla’s booth had become “a platform for rights defenders.”
A story to bring some cheer in these dark times: This delightful five-year-old girl from Fujian who speaks Mandarin, English and Hindi - her dad’s from India and mum is Chinese - is winning hearts in China after a dance performance on a talent show on State broadcaster China Central Television.
You can watch the full segment here, which begins with her trilingual greeting and also includes her dad (around the 5 minute mark) busting out some Michael Jackson-style dance moves to a remixed version of the 1950s hit Awara Hoon, which remains a favourite in China especially among older Chinese…
What’s not to like?
Thank you for reading, and do take care.