Monday, May 14, 2018

Dolam To Wuhan: India-China Reset


     The so called “Reset” in India China relations, has been widely and wrongly reported as a change in Indian strategy towards China. A few analysts also suggest that it is a change in Chinese Strategy towards India. If we define strategy and tactics conventionally, the arguments for either of these hypotheses is unconvincing. [i] To the extent it is a reset, it’s a tactical one extending the next few years, not a strategic one relevant for the next 5-10 years.
  India’s Foreign Policy has changed over the last five years along with its redefinition of itself as an “aspiring leading power”.[ii] There is an effort, since 2014, to define India’s interests more clearly and to pursue them without looking over our shoulder at every step, or to worry how third parties will respond to these policies. This applies to policies such as, (a) A firmer line, diplomatically and militarily, on Terrorism and (b) Building strategic defence capabilities through partnerships, including with USA. There is also an attempt to develop a more symmetric & reciprocal foreign policy with respect to China. This has not been abandoned, but tactics and operational actions must respond to new developments & this includes the reactions of the adversaries and partners. These include the Trade Defence (/war) launched by the Trump Govt against Xi Govt of China and the new risks it has created for FDI investors in China’s export industry, and the reverberations of the Doklam crises.

Symmetry & Reciprocity

         To understand the Xi-Modi informal summit of April 2018, and its implications, one has to step back to 2017 and two sets of events: On 17 April 2017 Dalai Lama visited Tawang and addressed thousands of Bhutanese devotees.[iii]  Chinese called this visit a provocation.[iv] India’s official formal Position on the Dalai Lama has always been clear: Following the millineal traditions of India and the 3/4 century traditions of democratic India, He is an honored Religious figure and is free to carry out his religious activities anywhere in India. It has been obvious for Long that the Communist China doesn’t see it that way, as to them Religious activity (e.g. in Arunachal Pradesh or Tawang) is indistinguishable from political activity. Going further the party and its media organs have arrogated to themselves the right to criticize visits of Indian dignitaries to Arunachal Pradesh.
   The second event followed within two months, likely the time it took the PLA to get approvals and orders from the top leadership & translate them on the ground. On June 16, 2017 Chinese troops with construction vehicles and road-building equipment began extending an existing road which ran roughly North North-East in the disputed Bhutanese Trijunction area of Dolam held by them, south South eastward across a little creek. On 18 June 2017, around 270 Indian troops, with weapons and two bulldozers, entered Dolam to stop the Chinese troops from constructing the road.[v]  The formal Indian position is also clear, that there is a written agreement, under which none of the parties will do anything to change the status quo in the India-Bhutan-China Tri-junction area now commonly referred to as Dolam area.[vi] India also has a long standing mutual security agreement with Bhutan under which it assists Bhutan in protecting its territorial integrity and security. India viewed the extension of the road SSE within the (Bhutanese) territory held by China, as likely to change the “status quo” in the Tri-junction area in favour of China and took action to stop it. The PLA and its leadership were shocked and dismayed by this Indian action, and apparently sought to convey to China’s top leadership as outright aggression by India on China, w/o bringing to its attention the Tri-junction agreement.
    It took two months to resolve the crisis diplomatically.[vii] Throughout this period the organs of the Communist Party of China, such as The Global Times, verbally attacked and abused India, a playing out of what I have termed the Three Wars Strategy ie Legal war, Media War and Psychological War (or PsyOps) . India, it’s government and even the media, in contrast, kept their diplomatic cool and played the issue without rancor or emotion.
   However, there was a period when it looked like the PLA may turn it into a hot war, on the species assumption that it still had, as in 1962, the ability to “teach India a lesson”. Indian forces were very confident that they could ensure China would not gain, in net terms, from a hot war; Further it was in a position of creating enough risk for the PLA that attacking Indian forces in the Northern boundary areas had a positive, even though small, risk of PLA ending up with egg on its face. India’s political leadership was equally clear that it was far more beneficial to all to resolve the issue through diplomacy instead of war.

Indian Motivation: Risk Reduction

   In Late February 2018, the foreign secretary requested the cabinet secretary to advise Govt officials not to attend events organized by the Tibetan leadership in exile. Though this was consistent with the distinction that the Govt of India has always made between Religious activities and political activities of the Tibetan exiles based in India, it was rightly seen as a signal to the Chinese leadership that India was ready to diffuse further the confrontational environment that had developed in 2017.
   From India’s perspective there were two important problems seen during the crises that needed to be corrected. One, was the impression, appearing repeatedly, that the top leadership was not fully and objectively briefed by the PLA and /or others on the Indian position on the Tri-junction boundary areas, whence the need for a top level informal summit. The second problem that seemed to emerge, was that the PLA and consequently the Chinese military commission headed by General secretary Xi, seemed incompletely aware of the capabilities of the Indian armed forces, particularly the Indian Air Force, circa 2018. This problem was sought to be addressed among other things by the Gagan Shakti exercise that preceded the “informal summit”.
  The uncertainty created by US sanctions on Russian defense companies and to a lesser extent on Iran, may have also weighed on Indian decision makers.

Chinese Motivation

    There seem to be two possible motivations for China to consider toning down the possibility of conflict, at this time. One is the largely negative reaction to Chinese efforts to expand its territory and territorial control across its entire periphery, stretching from the Himalayan border, through the South China Sea to the East China Sea, with a dawning realization that this is provoking all the effected countries to explore and expand security co-operation among themselves and with the USA & other powers in the Indo-Pacific.  Its reaction to the “Quad” is symptomatic of this concern, not necessarily a fear of the Quad per-se. The second more immediate and clear motivation is the “technology defence” and “trade war” launched by the US administration. By my estimate any direct trade war between USA and China could result in a 2%-point decline in China’s growth at the cost of a maximum 0.5% growth decline for the USA, a 4:1 advantage for the USA viz China.[viii]
    Even if the trade issue is resolved by China, by substituting imports from USA for imports from Rest of the World (ROW) to satisfy the obsession with the bilateral CAD with China, the uncertainty created for export oriented FDI in China will have a permanent negative effect on China. Such investment now has much greater incentive to diversify out of China to India and other Lower Middle-Income countries (LMICs).
   For a while after the possibility of a Xi-Modi summit surfaced in public domain, there was also speculation that a major deal involving India’s NSG membership, working of the UNSC subcommittee on designation of global terrorists and OBOR/CIPEC may be in the offing. This speculation was partly fueled by expansive statements/articles in the Chinese Communist Party controlled media. However Indian spokespersons, directly or indirectly, soon dampened such speculations, and tried to focus it on broader issues and understanding. It soon became clear, that even a restatement of previous agreements and understandings, by a leader who was positioned to lead China for the next couple of decades had a value in itself.

Wuhan Summit

   The informal summit between President Xi and PM Modi was held in Wuhan on April 27-28, 2018.[ix] There were two noteworthy announcements:
(1) On giving “strategic guidance to their respective militaries to strengthen communications in order to build trust and mutual understanding and enhance predictability and effectiveness in the management of border affairs” or in China’s terse words, “strengthen confidence building measures and enhance communication and cooperation to uphold border tranquillity,” Some observers have read a lot into the non-mention of “Strategic guidance in the Chinese version of the summit discussions. This is likely due to the sensitivity of these words for the communist party and its internal institutional management (E.g. the implication that either such guidance from the CMC & its leader was absent earlier or that despite existence of such guidance it was unimplemented is unacceptable to the party leader).
   This is an attempt to fill the gaps in understanding and in communications that were observed during the Dolam crisis, and to extend the border management procedures already operational at the LAC to border areas such as the Trijunction, not traditionally part of the LAC. The underlying objective for India is to minimize the probability of a hot war through accident, mistake, misunderstanding or misjudgment (of our capabilities). Apparently China and its leader are equally interested in this objective at the current juncture, when it its confronted with several challenges on economy, trade, N Korea, Taiwan and South China Sea.
(2) The agreement to do a joint economic project in Afghanistan to “open new areas of cooperation “
     Afghanistan is a country in which China and India have some overlap of interest, namely to keep it from becoming a base for Jehadi Terrorism. Both India and China have some advantages and limitations/constraints in Afghanistan. India has a clear economic & social advantage based on its labor n term relationship with the Afghan Govt & people. It’s major limit is access. China on the other hand can provide security for its projects, through its influence with the Pakistan Army & its terrorist network! A joint project in Afghanistan can minimize each other’s constraints for mutual benefit. It also provides an opportunity to develop a better understanding on cooperation in anti-terror and infrastructure, by working together on an experimental basis.

Neti Neti

      Given the vast amount of misinformation, misunderstanding and baseless speculation, it’s also important to state what this summit was not about and did not do. The summit was not about India-China trade imbalances, economic cooperation in India or River flows. It did not discuss/resolve the issue of China’s veto of India’s NSG membership or our objections to OBOR (the term still used in Chinese). It doesn’t change the time line of China-Pakistan alliance, which has been developing for 30 years, and accelerated a decade ago with the agreement to develop Gwadar into a Chinese logistic naval base disguised as a commercial port.
    The agreement to explore cooperation in Afghanistan is not (repeat not) the first step towards “joining” OBOR. Unlike AIIB or any other formal institution, with rules, regulations and institutional structure, OBOR is whatever China defines it at any given time: Its just a post-hoc collection of projects, motivated by excess capacity in China, attempt to grab the diplomatic initiative from the established powers and a National security strategy disguised as a commercial initiative.[x]


    The Wuhan summit does not change India’s understanding of the medium-long term strategic challenge from China. It merely provides breathing space for us to up our development of border infrastructure, fill basic gaps in defence production such as ammunition and to replace outdated defence equipment. It gives us some breathing space to get our own house in order, in terms of border infrastructure, shortage of and foreign dependence on ammunition, reform of the National security structure (a la DPC) and pending, excruciatingly slow decisions on Security partnerships with the USA & other countries.  

[ii] Virmani, Arvind, “Foreign Policy Under PM Modi, Policy Paper No. WsPP 4/2015, N Delhi, May 2015. . Virmani, India, “India's National Security Doctrine: An Approach”, June 24, 2016 .
[iii] Dalai Lama reaches Tawang - The › article17866681 )
[iv]  How India should respond to China's response to Dalai Lama visit to Tawang - Business Line, › ... )
[vi]  Doklam Standoff-China Violates agreements with India and Bhutan » Indian Defence Review › spotlights , Why China's Legal Claims for Doklam Are Weak › 2017/08 › c... ).
[vii] Doklam standoff ends as India, China step back - The › article19577183
[ix] India-China Informal Summit at Wuhan - The Ministry of External › press-releases › India...

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