Challenges/Areas of contention

A) WATER

  • Asia is a water-deficient continent. Although home to more than half of the human population, Asia has less fresh water — 3,920 cubic meters per person — than any continent besides Antarctica. Water has emerged as a key issue. China, which controls the Tibetan plateau — the source of most major rivers of Asia has emerged as a decisive player in the water arena. The preciousness and possession in geopolitical mechanics makes water a strategic commodity and its role as a strategic asset or vulnerability cannot be over-estimated.
  • Tibet’s vast glaciers and high altitude have endowed it with the world’s greatest river systems. Its river waters are a lifeline to the world’s two most-populous states — China and India — as well as to Bangladesh, Myanmar, Bhutan, Nepal, Cambodia, Pakistan, Laos, Thailand and Vietnam. These countries make up 47 percent of the global population.

 

 

 

 

 

 

The potential interstate conflict over river-water resources are of great concern. This concern arises from:

  • China’s territorial position on Tibet has a significant bearing on the current and future water issues with India, which is a lower riparian vis-a-vis China.
  • Chinese attempts to dam or redirect the southward flow of river waters from the Tibetan plateau, where major rivers originate, including the Indus, the Mekong, the Yangtze, the Yellow, the Salween, the Brahmaputra, the Karnali and the Sutlej. Among Asia’s mighty rivers, only the Ganges starts from the Indian side of the Himalayas.
  • China has increasingly dammed rivers to produce hydropower and channel waters for irrigation and other purposes, and is currently toying with massive inter-basin and inter-river water-transfer projects.
  • Controlling over the 2.5 million-square-km Tibetan plateau gives China tremendous leverage, besides access to vast natural resources.
  • Having extensively contaminated its own major rivers through unbridled industrialization, China now threatens the ecological viability of river systems tied to South and Southeast Asia in its bid to meet its thirst for water and energy.Large hydro projects and reckless exploitation of mineral resources already threaten Tibet’s fragile ecosystems, with ore tailings beginning to contaminate water sources.
  • India being the lower riparian, will be vulnerable to any major storage projects planned on the YarlungTsangpo.
  • As China’s hunger for primary commodities has grown, so too has its exploitation of Tibet’s resources. And as water woes have intensified in several major Chinese cities, a group of ex-officials have championed the northward rerouting of the waters of the Brahmaputra in a book titled “Tibet’s Waters Will Save China.”

 

 

B) Border issue (Tibet/Aksai Chin)

The main problem between the two countries is the Border question, which is a historical one.

  • The Border issue is rooted in the disputed status of the McMahon Line, which defines the border between India and Tibet.
  • India recognizes this agreement as the basis for its territorial claim while China objected the validity of McMahon Line which was drawn in 1914 Simla convention
  • China believes that it was not a party to Simla Convention so it is not bound to accept the boundary demarcated by Simla convention.
  • India claims 43,180 squares Kilometers of Jammu and Kashmir occupied by China including 5180 square kilometers cede to China by Pakistan under a 1963 China-Pakistan boundary Agreement.
  • On the other hand China claims 90,000 square kilometers of territory held by India in Arunachal Pradesh.

 

 

 

 

  • There has not been a remarkable progress in resolving the border dispute between the two sides due to the importance of Aksai Chin to China because it is the main link between Tibet and Xinjiang province of China and Arunachal Pradesh to India is crucial to stability in India’s north-eastern insurgent affected areas.

C) Dalai Lama (Religio-Political Dimension)

  • China views that India is treating Dalai Lama in India as government in exile in Dharmsala which is just 200 miles away from China’s border.
    • The presence of more than 1,00,000 Tibetans refugees in India
    • India’s continued willingness to provide shelter to the Dalai Lama is a continued source of irritation in China-India relations.
    • Dalai Lama and his anti-China Activities in India have negative implications for India- China relations.
  • After the 1962 war, relationship between China and India remained hostile for several decades. India’s grant of statehood to Arunachal Pradesh in the late eighties (February 1987) which China claims as a part of South Tibet caused the hostility on the bilateral relations to such an extent that another border war seemed about to happen.
  • Ease on border and overall border relations began to improve following the border agreements in 1993 and 1996 between the two states.
  • The two sides have also pursued Confidence Building Measures (CBMs) along the border which includes mutual troop cut, regular meetings of local military commanders and other confidence measures.
  • In 2003 when both the sides appointed Special Representatives to address the border issue. Since, then the Special Representatives have held number of talks to resolve the border issue.

 

 

D) CPEC

  • India has expressed strong opposition to the $46 billion China-Pakistan Economic Corridor (CPEC) project, which is the key to Beijing’s ambitious ‘One-Belt, One-Road’ initiative,Chinese-funded CPEC, links China’s Muslim dominated Xinjiang province to the Gwadar deep-sea port in Pakistan.
  • Main Issues:
    • SovereigntyThe CPEC passing through Pakistan-occupied-Kashmir (PoK) challenges Indian sovereignty as it passes through Gilgit-Baltistan in PoK.
    • Terrorism :Pok is used as terrorist launch pad to carry out anti- India terrorist activities in Jammu Kashmir and is also a source of terror funding.

 

 

E) BRI (Belt Road Initiative)

  • President Xi announced the initiative during official visits to Kazakhstan and Indonesia in 2013. The plan is two-pronged
  • Overland Silk Road Economic Belt and
  • Maritime Silk Road.
  • The two were collectively referred to first as the One Belt, One Road initiative but eventually became the Belt and Road Initiative.Morgan Stanley has predicted China’s overall expenses over the life of the BRI could reach $1.2–1.3 trillion by 2027

F) Salient features

  • It includes creating a vast network of railways, energy pipelines, highways, and streamlined border crossings, both westward—through the mountainous former Soviet republics—and southward, to Pakistan, India, and the rest of Southeast Asia.
  • Expand the international use of Chinese currency, the renminbi
  • China plans to build fifty special economic zones, modeled after the Shenzhen Special Economic Zone
  • To accommodate expanding maritime trade traffic, China would invest in port development along the Indian Ocean, from Southeast Asia all the way to East Africa.
  • To date, more than sixty countries—accounting for two-thirds of the world’s population—have signed on to projects or indicated an interest in doing so.

 

 

Objectives

China has both geopolitical and economic motivations behind the initiative.

  • Promoted as a vision of a more assertive China
  • Slowing growth has put pressure on the country’s leadership to open new markets for its consumer goods and excess industrial capacity.
  • Experts see the BRI as one of the main planks of Chinese statecraft under Xi, alongside the Made in China 2025 economic development strategy.
  • BRI serves as pushback against the much-touted U.S. “pivot to Asia,” as well as a way for China to develop new investment opportunities, cultivate export markets, and boost Chinese incomes and domestic consumption.
  • BRI will improve China’s image among its neighbors, and help to rejuvenate them economically.
  • Promoting economic development in the western province of Xinjiang, where separatist violence has been on the upswing, is a major priority
  • Securing long-term energy supplies from Central Asia and the Middle East, especially via routes the U.S. military cannot disrupt.
  • Restructure the economy to avoid the so-called middle-income trap.
  • BRI will offer new import and export options, creating new production chains that will spur the development of the Chinese economy

G) String of Pearls

  • ‘String of Pearls’ refers to a geopolitical theory to the network of Chinese intentions in India Ocean Region (IOR). It is the network of Chinese military and commercial facilities developed by China in countries falling on the Indian Ocean between the Chinese mainland and Port Sudan.

 

 

  • Chinese interests
    • Political and Diplomacy Perspectives
      • Building deeper relationship with nations in Asia and Africa
      • Greater recognition in global arenaas a powerful nation in a multipolar world
    • Economic Perspectives
      • Infrastructure Buildup in the sea trade routes
      • Focus on Energy Security aspect(Strait of Malacca)
    • Military Perspectives
      • Creation of military outposts across the IOR
      • Upgrading the intelligence gathering perspectives with reliance on Electronic, communication, satellite imagery-based intelligence and use of Space-based assets
  • Creation of berthing places for surface ships and pens for docking submarines
  • Military personnel training and rotation on different platforms for operational deployment

 

 

Issue for India

  • China’s naval presence in these waters will lead to overlapping spheres of influence with India
  • China has acquired a ‘blue-water’ navy and developed a number of military and civilian seaports in the Indian Ocean region, enabling it to exercise increased maritime influence on the sea lines of communication (SLOCs) within and through the region
  • India imports 70 per cent of its oil and gas energy requirements and depends on free access to sea routes for its trade to ensure its continued economic development
  • Indian shipping transiting through choke points like the straits of Hormuz and Malacca would be under grave risk
  • Chinese vessels may conduct espionage and intelligence-gathering activities within IOR
  • In case of a Sino-IndianconflictChinawillcertainlyinterdictIndianstrategicsupplies.Gwadar will be particularly helpful for Chinese submarines to interdict India-bound tankers
  • China’s energy exploration in waters off Bangladesh and Sri Lanka,adjoining the Indianterritorial seas constitutesalatentthreat
  • Increased Chinese tanker trafficto ports in Myanmar will also increase the risk of oil spills off Andaman & Nicobar Islands which are ecologically sensitive

 

 

H) Doklam Issue

  • Doklam,(Donglang in Chinese), is an area spread over less than a 100 sq km comprising a plateau and a valley at the tri-junction between India, Bhutan and China. It is surrounded by the Chumbi Valley of Tibet, Bhutan’s Ha Valley and Sikkim.In 1949, Bhutan signed a treaty with India giving allowance to India to guide its diplomatic and defense affairs.
  • In 2007, a new Friendship Treaty replaced the provision that made it mandatory for Bhutan to take India’s guidance on foreign policy, provided broader sovereignty.

Importance

  • Doklam is strategically located close to the Siliguri Corridor, which connects mainland India with its north-eastern region. The corridor, also called Chicken’s Neck, is a vulnerable point for India.
  • In recent years China has been beefing up its military presence in the Chumbi Valley, where the Chinese are at a great disadvantage militarily. Both Indian and Bhutanese troops are on a higher ground around the Valley.
  • Chinese have a deep interest in Doklam, as it would give them a commanding view of and an easy access to both the Chumbi Valley and the Siliguri Corridor.
  • China’s claim on Doklam is based on the 1890 Convention of Calcutta between China and Britain

 

 

 

 

  • The escalation began on June 16, 2017, when Chinese troops came to the area with equipment to extend a road southward in Doklam, towards the Bhutanese Army camp near the Jampheri Ridge, which according to both Bhutan and India are an integral part of Bhutanese territory.
  • Two days later, a few hundred Indian troops entered Doklam, at the request of Bhutan, and stopped the construction.
  • The Bhutanese government told China that the construction of the road inside Bhutanese territory is a direct violation of the agreements and affects the process of demarcating the boundary between our two countries.
  • On 28 August 2017, India and China announced that they had agreed to pull their troops back from the face-off in Doklam. By the end of the day, it was reported that the withdrawal was completed

 


Indian response to counter China’s rise

  • Chabahar Port: India is developing Chabahar Port in this strategic location will allow India to counter China-Pakistan axis in IOR.Chhabahar give India a strategic position since it overlooks Gulf of Oman, a very strategic oil supply route.
  • ‘Act East Policy’ India : Through ‘Act East Policy’ India has been trying to improve relations with ASEAN and countries like South Korea and Japan enhanced engagement to ensure India remains engaged in China’s neighbourhood to maintain balance of power for regional stability and freedom of navigation in disputed SCS and IOR itself.Important military and strategic agreements have been made with Vietnam, South Korea, Japan, Philippines, Indonesia, Thailand and Singapore.
  • The Asia-Africa Growth Corridor: India has in partnership with Japan has planned for The Asia-Africa Growth Corridor which is seen as a response to China’s Belt and Road Initiative (BRI). Through The Asia-Africa Growth Corridor India- Japan seeks to counter China’s rising footprint in IOR.
  • The Quad: Through ‘Quad initiative’ India, Japan,Australia and the US will cooperate economically, militarily and strategically for free, open, prosperous and inclusive Indo-Pacific region that serves the long-term interests of all countries in the region and of the world at large
  • India has agreed to develop Myanmar’s Sittwe port. India has also developed strategic naval relationship with Myanmar to upgrade and train its navy which gives India an increased footprint in the area. India is in talks with Seychelles to create an Indian military base on one of its Islands. India already has a military base in Madgascar which overlooks Mozambique Channel.
  • Modernizing India Armed Forces: India is modernising its power it has completed its Nuclear Triad by commissioning INS Arihant and has inducted INS Vikramaditya, in Navy in 2013 further it is indigenously building another aircraft carrier INS Vikrant.
  • India has invested a lot diplomatically in countries like Turkmenistan, Uzbekistan, Kyrgyzstan, Kazakhstan and Mongolia – all surrounding China.
  • Project Mausam. Project ‘Mausam’ aims to understand how the knowledge and manipulation of the monsoon winds has shaped interactions across the Indian Ocean and led to the spread of shared knowledge systems, traditions, technologies and ideas along maritime routes.By invoking the historical linkage, this is India attempts to remind the 39 littoral countries that there is a shared cultural heritage among us and therefore let us not be influenced by extra-territorial powers.

 

Future course of action

  • Creating a major global manufacturing hub in India

With the dependency of trade and manpower being employed, this creates a much better scope of cooperation without straining Indian monetary aspect too much.

  • Creation of a tax-free zone in A&N islands.
    1. The aim is to create a gateway region replicating Mauritius – gateway to Africa, Singapore – gateway to Southeast Asia, Dubai – gateway to ME perspective.
    2. A Free Trade Zone and Free Economic Zone with full exemptions/concessions to the investor would attract a large amount of foreign capital flow, boost exports and in turn boost precious foreign exchange improving our overall financial health further.
    3. This coupled with skilled job creation will help us use our young population adequately.
  • Opening up interbank cooperation with the extent of allowing Domestic Systemically Important Banks (D-SIB) to open up branches with full services in support nations.
    1. Indian Rupee acceptance and Indian Rupee structured loans will make this proposition even more attractive.
    2. This will free the forex fluctuation effects and help the economies of all further.
  • Champion the cause of renewable energy
    1. Use Solar Energy and low-cost solar cells as an effective tool to help supporting nations ease through the energy crisis.
    2. India’s brainchild International Solar Alliance should be used to good effect
    3. Will help create a better image of responsible India
  • Medical tourism industry
    1. Ease in visa procedures.
    2. Subsidized Airfares to and fro for patient and dependent.
    3. Better Medical insurance for overseas patients
  • Collaboration and the opening of quality Education institutes like IIT, IIM and IISc in neighboring nations in order to impart quality education. Such campuses will help in strengthening the overall education system of the whole region. This will further cause the soft power increase for India
  • Use Culture, sports, movies, film and music to create a bonhomie and united aspect of all countries together.

Security Initiatives

  • Spend on a rapid Armed Forces modernization plan with the focus on two front war aspect. This will mean India need a considerable investment. The modernization must be tangible in the timeframe, use a mix of indigenous public and private sector and also suitably make maximum assets under Make in India
  • Formation of a joint command with the appointment of Chief of Defense Staff(CDS)
  • Appoint important resources in Cyberwarfare and invest heavily to protect its military installations and the dual-use ones against Cyber-attacks.
  • Upgrading relationships with countries around the Horn of Africa such as Oman and Yemenfrom naval berthing rights and anti-piracy operations to full scope of military deployment. Such a position will help us checkmate Gwadar and CPEC permanently.

 

 

 

Areas of Engagements

It has not been long since India and China started to engage in track II dialogues. The foundations of these dialogues were laid in April 2005, when the Indian Council of World Affairs (ICWA) and Chinese People’s Institute of Foreign Affairs (CPIFA) signed a Memorandum of Understanding (MoU) to seek bilateral cooperation.

The first structured dialogue began as late as November 2013.

  • The governments have been utilising research centres dedicated to India and China studies to cultivate more expertise in both countries in order to promote mutual understanding and facilitate international exchanges.
  • Scholars from China and India are engaged in joint research projects
  • Retired diplomats and security advisors play a crucial role in mediating between the official and the non-official domains.

Track two dialogues have been instrumental in developing an understanding of each other’s security concerns and perspectives.

  • Representatives from the Indian side discuss their security concerns regarding China’s continued logistical and military support to Pakistan, and its heavy investment in CPEC (China-Pakistan Economic Corridor) that violates India’s territorial integrity.
  • Similarly, the Chinese representatives discuss their concerns regarding India’s ties with America and its role in America’s Indo-Pacific strategy.

Chinese companies have strengthened their research on Indian culture, domestic law and business environment to expand their business in India.

  • The employees of Chinese companies like Xiaomi in India are engaged in communication with local people and grass-roots officials and establish a friendship and deeper economic integration. By expanding and enhancing connections with civil society, Xiaomi, Vivo, Oppo, One plus and other Chinese companies bring a distinct feature to India-China relations.
  • Similarly, Indian pharmaceutical companies have been engaging with local Chinese facilities to create an acceptance of Indian medicines in China, thus making inroads into the Chinese market.

 

 

 

Way Forward

  • Although track II dialogues between the two countries have only begun in the last few years, they have great potential in promoting stable bilateral relations in the future.
  • The key is how to make full use of the existing mechanisms, expand new channels of communication, explore broader topics for discussion, and improve the efficiency of influencing government decision-making.
  • The trust deficit is a critical issue in Sino-Indian bilateral relations that cannot be ignored. In order to solve this problem, track II can play a more active role. The focus needs to be on expanding “trust society” with “high trust” by facilitating personnel exchanges at all levels and in all fields of society. Only when this part of the population is involved, can it be possible to weaken the mutual trust deficit.

A) Media Engagement

  • The media remains the closest to the political establishment and serves as the link between the governments and the public. Their narrative directly shapes public perception.
  • It is the responsibility of media to convey real information and avoid playing the role of a ‘bad guy’
  • Deeper engagements between the media persons of the two countries would be necessary for improving the image of the two countries.

B) Academia Engagement

  • The improvement of the India-China relations require rational voices, and scholars are the ones who make rational voices.
  • There is a need to cultivate expertise on India and China in academic institutions and through a robust educational exchange such as visiting scholar and student exchange programmes.
  • A comprehensive and substantial study of each other’s national and social conditions is necessary to strengthen cooperation.

C) Cultural Engagement

  • The cultural industry, including tourism, entertainment, publications, internet service sectors, needs to be targeted.
  • The last few years have witnessed an enthusiastic reception of films both sides, especially when the Indian movie ‘Dangal’ broke box records in China and generated great interest in India among the Chinese populace.
  • Cultural industries of China and India are strengthening track II dialogues and fulfilling commitments made by leaders of the two countries for stronger bilateral relations.

D) Startups/Venture capitalists

  • Chinese venture capitalist (VC) funds have been rapidly making their way across the Himalayas and betting on the Indian startup story. In 2018 alone, Indian startups raised around $5.6 bn from various Chinese investors, following from the $3 bn in 2017.
  • Chinese money today has offered a fresh lease of life to the perennially cash-crunched Indian startups. It all began with Alibaba’s investments of $500 mn in Snapdeal, $700 mn in Paytm and $150 mn in Zomato in 2015
  • The India-China startup symbiosis is based on a solid foundation:
  • India’s future growth numbers are set to attract investments and
  • The infusion of capital will help early-stage startups to grow faster and reduce the attrition rate amongst them.
  • India has the third highest number of startup incubators and accelerators in the world, after China and the US.
  • Given China’s excess finance and technology expertise, India is the only country that has the market and the strength to absorb China’s excess capacity.
  • This complements the already famous ‘China plus one’ model, which aims to shift operations outside China to benefit from cheaper labour, new markets, and less domestic vulnerability.
  • India’s digital potential and the hyper-local startup ecosystem for investment opportunities.
  • Chinese VCs offer crucial domain expertise in areas such as internet-based business, artificial intelligence, big data, robotics and automation, fintech, health, environment, e-learning, agricultural technology etc.
  • China as a future hub of services export bodes well for those Indian startups with the strength of Chinese capital.

E) Policy challenges and national security concerns

  • Illegal data transfer to China in the absence of a strong data protection framework. Indian government recently sought a detailed response from ByteDance, the parent company of TikTok, about the use of its application for the ‘circulation of unlawful content. It is imperative that the Indian government devises a coherent set of regulations around data protection, localisation and cross-border data transfer.
  • Apart from data privacy issues, Chinese investors and companies face pressure from India’s startup lobby group Indiatech, which seeks to ‘protect the interests of Indian companies and investors in the Internet sector.’
  • Need of Comprehensive cyber-security laws.

 

 

 

Space Arena: Competition or Cooperation

A) China

  • Became the third country after the United States and Russia to send humans into space.
  • In 2007, it entered the anti-satellite arena by obliterating an old satellite. Only the United States, Russia and India (in 2019) have conducted such tests.
  • Beijing’s ambition is to lead the world in space technology by 2045, and in pursuit of the same the space industry was opened to the private sector in 2014.
  • In 2019 China launched a rocket carrying satellites from a mobile platform in the Yellow Sea for the first time, making it the third country after the US and Russia to succeed with sea launches.
  • China has been supporting the space programmes of several nations like Brazil and Nigeria, by selling commercial satellites and imparting training and technology to others to launch their own.

B) India

  • Space programme as a marker of India’s rising global stature.
  • In March 2019 India had become the fourth country to shoot down a low-orbit satellite with a missile.
  • The nation’s budget for space-related activities is $1.8 billion, making it one of the most cost-effective projects in the world.
  • ISRO has launched almost 300 satellites for other countries, with a 104 famously launched at one go.
  • India is planning the first human mission to space in 2021, titled Gaganyaan.
  • In 2017, ISRO launched the 2,230 kg GSAT-9 South Asia satellite. ISRO has launched almost 300 satellites for other countries, with a 104 famously launched at one go.

Today, both China and India are using pioneering research in the arena of space exploration to build ties with the developing world.

  • At the South Asian Association for Regional Cooperation (SAARC) summit in 2014, Prime Minister Modi announced plans to launch a SAARC satellite (later named South Asia satellite) offering communication services free of charge to SAARC nations.
  • It is expected that by 2020, China’s indigenous network of 35 BeiDou satellites will provide navigational services to more than 60 nations that have signed up under the Belt and Road Initiative (BRI), posing a challenge to America’s GPS and Europe’s Galileo systems.
  • India and China formally established the Sino-Indian Joint Committee on Space Cooperation in 2015.
  • In the same year the outline of Sino-Indian space cooperation was signed which includes 19 projects in seven areas:
    1. Remote sensing satellites,
    2. space-based meteorology,
    3. space science and lunar and deep space exploration,
    4. education and training,
    5. piggy-back launch services,
    6. satellite navigation, and
    7. space components
  • In 2018, the then Indian ambassador to China GautamBambawale visited CNSA twice in half a year and exchanged views with Zhang Kejian, the CNSA head, on promoting Sino-Indian space cooperation.

 

Similarities/opportunities for cooperation

  • Both are major developing countries and emerging markets

Both countries’ populations are above 1.3 billion. China is the world’s second largest economy, while India ranks the sixth. Combined, they account for over 35 percent of the world’s population and contribute about 20 percent of global GDP, thus the two economies are at similar stages of development and can learn from each other in many ways.

  • They share common interests, concerns and propositions

The two countries are the mainstays for a multi-polar world and economic globalization and are important for regional and global peace, stability and development.

Both countries face enormous uncertainties in today’s world, such as rising protectionism in the United States and multiple security concerns in Asia.

  • Complementary economies

Chinese and Indian economies are highly complementary to each other.China can provide technology and financial support for India to build and improve upon its infrastructure, while India is strong in IT and pharmaceuticals.China’s private investment in India has grown steadily in recent years. With the transfer of some labor-intensive industries, more jobs have been created in India.Recently Chinese and Indian companies signed as many as 101 trade agreements with a total contract value of 2.38 billion US dollars, covering black tea, castor oil, peppermint oil, coconut fiber, coffee beans and other products.

  • Huge potential for further cooperation

Although trade between China and India expanded significantly last year, it still accounts for a small proportion of the global total. And China is exporting much more to India than the other way round. Areas such as trade, investment, infrastructure, information technology, the Internet, cultural tourism, and health care hold great potential for cooperation.

  • Cultural Exchange

There is also big potential to be tapped for greater cultural and people-to-people exchanges. Over 20,000 Indians study in China, and Chinese people like India’s Yoga, Darjeeling tea and Bollywood movies.An increasing number of Chinese students are learning Indian languages.

 

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