India - SEMINAR REPORT

The Contours of Sino-US competition in the 21st Century and Implications for India

Report of IPCS-IDS Conference held at the IDSA Auditorium on 24 November 2010

Opening Remarks: Maj Gen (Retd) Dipankar Banerjee, Mentor, IPCS

The Sino-US relationship has and will continue to have a major impact on the global environment. The several recent provocative acts by North Korea, including the shelling of a disputed area controlled by South Korea, upset the stock exchanges and the global economy. These developments require joint Sino-US action and coordination. Meanwhile, how can India leverage some of these developments to its advantage?

Inaugural Address: CISC

The 21st century is witnessing a tectonic shift in the economic and strategic balance of power from the West to the East. The bilateral relationship between the world’s largest economic and military power, the US, and the new rising power, China, will shape the 21st century. The nature of the relationship between the two could swing between cooperation, contestation, competition, and in a worst case scenario, confrontation. Despite their economic interdependence and desire to have a cooperative relationship; differing worldviews, positions in the international system, contrasting strategic and political cultures and competing geostrategic interests will continue to fuel the rivalry.

Keynote Address: Amb Shyam Saran

The Sino-US relationship will not only have an impact on India but also determine the regional security environment. The nature of this relationship will continue to be a complex mix of collusion and accommodation but the essential character will remain adversarial, and there will be phases of collusion and cooperation. This will determine India’s long-term policy perspectives as well. In the coming years, as China’s profile and footprints increase, the points of friction with the US will also multiply. A high level of confrontation between the US and China is however not in India’s interests.

Session I: Sino-US Relations

Chair: Amb Lalit Mansingh

The phases of confrontation and competition in Sino-US relations are characterized by phases of confrontation and competition. An overview of how India can benefit from it is necessary. China today is seeking global recognition the same way the US was a hundred years ago. However, the US was promoting ideas of democracy whereas the Chinese are not even making a pretence of it. Obama has been urging India to not only look east but also engage with the east. India should grow out of its regional shell and proactively engage with the region.

Dr Jabin T Jacob

China can accuse other powers of hegemonic mentalities while considering its own rise as natural, justified and unobjectionable. India needs to understand Chinese self-perceptions and its worldviews to be able to better strategize for the future. India also needs to understand how China perceives the the US’s loss of legitimacy as a superpower. The relationship between China and the United States can perhaps best be captured by a line in a mock video doing the rounds on the Internet, “They’re not enemies, but frenemies, with codependent economies.”

The principal actors on the two sides also need to be identified. In the Chinese political domain it is the Politburo Standing Committee of the Communist Party, the People’s Liberation Army and the Ministry of Foreign Affairs. The PLA plays a more significant role currently on issues like Taiwan and relationships with the US, Japan and India, while the MOFA is considered more liberal though it does work in consonance with national interests. The provinces and cities in China with their heavy dependence on FDI for economic growth might also be considered increasingly important actors.

Meanwhile, on the US side, the chief actors include the President and his National Security Council, the Department of State and the Department of Defence, the US Congress and business lobbies, with occasional clashes of views between the different branches of the executive and between the executive and the legislature. Besides these, there are the think-tanks, academics and analysts who influence bilateral relations to varying degrees in both countries. The US policy on China is likely to be shaped under a policy of whatever works, or of “crossing the ‘ocean’ by feeling the stones”, as it were.

Prof Srikanth Kondapalli

There are three significant issues one can emphasize in the Sino-US relationship. First is the context, second, the bilateral equation and third, the strategic relationship between China and the US. Today, there is a very different decision-making process in China which is divided into several lobbies. There is the Chinese Communist Party at the apex that includes the Foreign Affairs Bureau - which is most decisive on foreign affairs - the small leading groups that advise the Politburo Standing Committee and the extended Politburo. In addition, there is the Party Congress which, in its 16th and 17th meetings, laid down the larger framework of China’s foreign policy.

At the 17th Party Congress, China put forward the five pillars of foreign policy: (a) developing relations with the major powers in the world today, including the US, Russia, Japan, the European Union (some suggest that Hu Jintao had brought in India as a part of this relationship) (b) developing relations with neighbouring countries, (c) developing relations with developing countries in Africa, Latin America and others (d) expanding multilateralism - BRIC, India-Russia-China triangle, the United Nations and other multilateral forums like SCO, Boao Forum, East Asia Summit, and (e) building soft power, which it is learning from the US in a major way.

Though strategic competition can be identified between the US and China on the issues of democracy versus communism and respect for human rights, they are also contemplating cooperation on countries of concern, and on soft power issues like space-based troop positioning systems, cyber-warfare and homeland security. This suggests that though there are concerns, China would like to have economic cooperation with the US which can assist in its own rise.

Mr Mohan Guruswamy

Since the 1980s, the US has been the engine of growth in the global economy and has since managed to get away with a number of things. The US president issued a recovery package of US$600 million to save the US economy following the economic crisis. The Chinese complain about the devaluation of the US dollar as they have massively invested in US treasury bonds. However, despite these shortcomings, the US is still three times bigger than China in real terms and two times bigger in PPP terms.

Nevertheless, the notion of shifting power from the US to China is reflected in the project GDP figures for 2025. In 2050, China is predicted to become number one, US number two, India number three and Japan number four. The BRICs are actually predicted to become bigger than the G-7 by 2035. The US deficits under Bill Clinton were US$120 billion and the US national debt was beginning to decline as he was able to balance the trade. But the Bush administration led the country into huge debts and consequently, the present-day complications.

DISCUSSION
 
There is much talk about China being a responsible stakeholder but does this mean it should adhere to the norms of the current global system? The current degree of assertiveness is to defend the prerogatives that it holds in Africa and Asia. In this context, how does the clash of interests and balance of power relationship manifest itself in the strategic relationship between the US and China?

• In the last ten years, India has used several categories to categorize its relations, like strategic partnership and strategic cooperation. The US today holds the largest propriety rights to technologies. If India wants to be competent in the world it should not rule out reaching out to the US or any other country to upgrade its technological capabilities and investments.
• It would be a mistake to assume that Chinese thought processes remains constant. In fact Chinese perceptions are continually changing and drawing from the strategies of various countries.

Session II: Implications for India

Chair: Amb Ranjit Gupta

The enormous contrast in the multiple linkages and interactions between the US and China often equals or exceeds the ties that the US has with its major allies. Thus the circumstances in which these players may come forward to help their allies remains to be seen. Both the US and India face a common and escalating challenge from China, hence a multidimensional strategic alliance between the two is necessary. However, the US seems unable and or unwilling to assist India in mitigating serious threats emanating particularly from Pakistan and in the context of unfolding developments in Afghanistan. India’s primary insecurity derives from the extremely close nexus between China and Pakistan.

Despite Pakistan being increasingly recognized by everyone as the hub of global terrorism, it has never been sanctioned, and the US and China continue to provide aid to its nuclear programme. India is going to be affected much more by potential policy changes in the Indo-Pak-US triangular equation than by the fallout of the Sino-US contest per se. In the long term, a robust Indo-US policy will emerge independent of the China and Pakistan factor. But in the meantime India’s internal and short-term challenges should be looked after immediately.

Prof Swaran Singh

Although Sino-US competition can be viewed in a variety of ways, the current most important perspective is that of long-term competition. The world seems to be moving fundamentally from the 20th century obsession with territories to either cyber space or outer space.  This can thus be one area of examination with respect to Sino-US relations. The obsession with outer space technologies can be attributed to the US seeking to maximize its ground operations by using its access to information and other assets in outer space. It is thus moving much beyond militarization, putting the Chinese in a difficult situation since they cannot at present compete with such measures.
How does China see these US strategies in outer space technology exploration? China believes the US is the only country that not only has the capacity but also intends to retard the rise of China. Therefore, the US’s ambitious outer space programmes do impinge on the Chinese mindset.  What are the implications of this for India? It seems the US has not only put tremendous restrictions but has almost banned any movement of outer space commodities or technology to China and to India. Fundamentally, India is concerned about the challenges of its capacity and the undermining of its potential in the civilian launching of satellites.

Maj Gen (Retd) Dipankar Banerjee

India and China, two large Asian neighbours, are emerging simultaneously but with a distinct advantage and lead for China. China’s comprehensive national power is significantly larger than that of India’s. China is a permanent member of UN Security Council and that gives it enormous economic advantages; its superb infrastructure and significantly higher trade gives it enormous global influence and capability. But besides these developments, China perceives several threats from various sources. Anything that threatens the Party and its legitimacy to rule over the country is dealt with immediately and strongly.

India should shape its approach and strategy towards China keeping in mind these developments and challenges. India’s grand strategy should evolve irrespective of the state of Sino-US relations, taking into account the objective reality prevalent in the world, focusing on flexible approaches to the developments and on national interest. India should also focus on economic growth, improve its relationship with the SAARC neighbourhood, consolidate relationships with the periphery and secure a place at the global high table. In addition, it should engage in military strategy cooperation and confidence-building and develop asymmetric capabilities, and finally emerge as a major power in the global economy.

C Rajamohan

A strategic triangular dynamic is emerging between the US, China and India. Rising India affects both Chinese and American calculations. India should focus on opportunities and benefits that structural changes in the international and Asian systems hold for it. India is the weakest link in the triangle, still hesitant to handle the world’s changing power structure. India’s ‘Goldilocks Problem’ is the difficulty in taking sides in a Sino-US confrontation, conjoined with fears that a US-China condominium will constrain its space. The right amount of tension between the US and China gives India a beneficial bargaining space.

Sino-US relations are now at the point of uncertainty. So, how should India shape its policies? Five models/ strategies could be played: (a) prevent the emergence of a Sino-US condominium or their spheres of influence so that India gets a say in constructing the international system (b) build a serious maritime coalition to counter China (c) support an open capitalist system and not a mercantilist state-led version that China is building (d) ensure a stronger democratic identification that will accentuate India’s ideological differences with China (e) follow the Chinese model of aligning with the far enemy as the surest way to counter the near enemy.

India’s challenge is a rising China next door rather than a declining US global power. Therefore, the best logic is to align with the US - a distant power - to counter China. In addition, it is important to engage with both the US and China whilst balancing contradictions. The US and China are embroiled in ‘mutually assured financial disruption” and India should find ways to be innovative, dynamic and alert with policies shorn of the self-deluding rhetoric of India’s moral politics.

DISCUSSION

• India and the US are natural partners in dealing with a rising China. US President Barack Obama too hinted at harmonizing policies and interests for this purpose. India must play the game in its own national interest. 
• China will inevitably become a global naval power. Rather than protesting, India should consolidate its own power and develop a full range of capabilities in the Indian and Pacific Oceans through coalitions with island countries. • India should also build strong autonomous relationships with other major and middle powers to prevent a unipolar/ bipolar domination. Similarly, India should develop markets in non-English speaking countries and global organizations where China is venturing forcefully.  
• Tactical deterrence warrants greater discussion, especially limited tactical nuclear deterrence capabilities, to avoid limited tactical attacks on the Indo-Pak or Sino-Indian border. In the absence of assured external support and limited resources, asymmetric capabilities could be explored as tactical deterrents.

Report by Bhavna Singh, Panchali Saikia and Tanvi Kulkarni, Research Officers, IPCS