Challenges for China policy

We have entered the year of the Dragon. In Chinese astrology, the Dragon is the most powerful of signs, and an important symbol of the Han people. 2012 will be, in many ways, critical for China and for its relationship with the world. Not perhaps since the cultural revolution of the 1970s has there been as much global concern about China and so many signs of turbulence within. For Indians, the year marks the 50th anniversary of the Sino-Indian war, probably the most humiliating in the history of independent India.

Ironically, half a century later we seem to be as muddled about our China policy, as Prime Minister Jawaharlal Nehru was in the years before the conflict in 1962. Indeed, there is no greater challenge for Indian foreign policy in this year than the challenge to understand China – in all its complexities — and to frame policies for the next decade. And to do so, not just through the prism of western thinking, but in the light of our own experience.

In 2012, there are four key questions the answers to which may prove decisive for China and for its relationship with the outside world. First, will China’s so-called “resilient authoritarianism” — tied to the dominance of the Chinese Communist Party, unity within the party, and support of the People’s Liberation Army — survive the transition from the fourth generation leadership to the fifth generation? In November this year, at the 18th Communist Party Congress, if all goes according to plan, Xi Jinping should replace Hu Jintao as the President and Li Keqiang is expected to succeed Wen Jiabao as Premier.

Jinping belongs to the elitist Shanghai clique largely of princelings who were born to power and privilege, while Keqiang is from the populist faction who grew through the ranks of the Communist Youth League. But beyond these personalities, is the larger generational transition as well as the factionalism within the Party that will have serious implications for policy. The management of these contradictions, and the growing assertiveness of the PLA may create considerable turbulence and be responsible for increasing incoherence in Chinese policies at home and abroad.

Second, how will China make its slow but important transition from an export driven manufacturing economy (relying on cheap labour and focusing on the coastal regions) to an economy relying on domestic consumption, with an emphasis on services and the development of the hinterland? While it may be easy to dismiss Cassandra-like predictions of the Chinese economy being a bubble waiting to burst, it is obvious that China will probably face this year the most serious challenge to its growth since the late 1970s. Indeed, China’s 12th five-year plan (approved last year) itself has set targets that seem, at least at this stage, unachievable.

Third, will continued political and economic uncertainty and rising expectations translate into mass social and political unrest? 2011 was the year of protests almost across China and this is not counting the uprisings in Xinjiang and Tibet.The most recent incident in November-December 2011in Wukan, a fishing village in the prosperous province of Guangdong, may be a good indicator of growing popular restiveness. The villagers collectively took over the village, protesting against the sale of common land to property sharks. They threw out the local party leaders, and barricaded their villages in an unheard of act of collective defiance. The protests ended only after unprecedented concessions by the Party leadership.

Finally, will an increasingly insecure, new Chinese leadership — faced with growing problems at home — become more aggressive in terms of its foreign policy behaviour. 2011 witnessed a new Chinese assertiveness, particularly in the South China Sea, as China-watchers claimed that Beijing was abandoning Deng Xiaoping’s 24-character mantra of focusing on problems within and not becoming the centre of attention. Richard Haass, the President of the US Council on Foreign Relations, and one of the most astute observers of China recently wrote: “I have been travelling to China for more than three decades, but never have I encountered a Chinese leadership so uncertain of the country’s future. It is little exaggeration to say that the world’s most populous country is on its heels.”

These questions need to be probed in India by the government and independent scholars as much are they being probed by the rest of the world. In 2011, India witnessed what even Prime Minister Manmohan Singh described as new Chinese assertiveness, reflected in the cancellation of the Border talks over the presence of the Dalai Lama at a Buddhist convention and aggressiveness over the oil exploration pact with Vietnam over the South China Sea. The larger concern about Chinese encirclement of India is also no longer fanciful.

However, the Prime Minister recently dismissed the idea of China attacking India, which brought about a sense of déja vu. Nehru’s forward policy in 1962 was based largely on the intelligence assessment that Chinese would not respond militarily to aggressive Indian patrolling. That inaccurate assessment led to the fiasco of 1962 as an unprepared army had to face the wrath of the PLA.

2012 is not 1962, for a variety of reasons including the fact that the Indian armed forces are capable of meeting strong challenges. As one way of independent scholars to participate in the China debate, in an informed way, the government should seriously consider releasing the Henderson Brookes report, which is the only authoritative in-house study of the military defeat of 1962. If there are parts that are sensitive or have a bearing on the current border negotiation they can easily be redacted. It would be a tragedy if instead of learning from our history, we are condemned to repeat it.

In sum, while tactically India seems to be responding to Chinese assertiveness with firmness, there does not seem to be a clear long-term strategy in place. The challenge of managing China is so formidable that it will require the exercise of most of our military and diplomatic resources, and yet do we have these in place?

(Source: The New Indian Express)

Beyond 1971 war euphoria

Forty years after the creation of Bangladesh, there has been — in the Indian press — an outpouring of euphoria for what many have described as India’s greatest strategic achievement since Independence. And while in military terms it was undoubtedly a major accomplishment, many of the early policy conclusions that followed the war and the India-Pakistan agreement in Shimla in 1972 were proven wrong. In other words, with the benefit of four decades of hindsight, the Bangladesh War may have been a great tactical victory, but the strategic fruits that were to follow, especially, in terms of long-term peace in South Asia are still not on the table.

The humiliating defeat of Pakistan in the 1971 war, the dismemberment of the state, and the Shimla Agreement of 1972 are now widely viewed as Prime Minister Indira Gandhi’s greatest contribution to the nation. The debates, if any, have focused primarily on the role played by various institutions in creating and executing the policy which resulted, inter alia, in General Jagjit Singh Aurora, the Indian Eastern Army commander accepting the Instrument of Surrender from the head of the Pakistani forces, General A A K Niazi, on December 16, 1971 at Dhaka.

Till a decade or so ago, in many an army mess the roles played by Aurora, General J F R Jacob (the chief of staff, Eastern Command) and the army chief, General (and later Field Marshall) S H F J Manekshaw used to be hotly debated. Jacob has since written his version of the war. Within the intelligence agencies, it is R N Kao, founding head of R&AW who is lionised and the brilliant strategic analyst B Raman has reminded us of the contributions of spymasters whose analysis (and the role played in the creation of the Mukti Bahini) was critical, including the vital inputs of K Sankaran Nair, Brigadier Hassanwalia, Major General Uban, and Gary Saxena. There is also a larger historical debate, which will continue to be played out, on the thinking, planning and objectives of the Indian leadership, and the role-played by the outside powers, especially the United States, the Soviet Union and China.

What has grabbed less attention is the expectations within the establishment about the larger strategic consequences of the 1971 victory and Shimla. There must have been at least three expectations. First that as a consequence of 1971, Pakistan and indeed the entire region would recognise the superiority of Indian military and would be unwilling to take the risk of confronting India. It was hoped that not only would the 1962 debacle of the Chinese war and the stalemate of the Indo-Pak war of 1965 be erased from the collective memory of the region, but that the smaller states would begin to accept the dominant role that India would play in the region to the exclusion of outside states (almost an Indian Monroe doctrine). Second that there would be a settlement of Jammu and Kashmir with the LoC becoming the de facto international border. Indira Gandhi’s then secretary, P N Dhar has confirmed that Z A B Bhutto, then Prime Minister of Pakistan, had agreed to this unwritten understanding at Shimla. And finally that Pakistan as a state would reform itself in at least two ways. One, by accepting that the creation of Bangladesh had proven the fallacy of the two-nation theory and of the role of religion as a binding force for nationhood. Thus it was expected that Pakistan would devolve greater power to the provinces and move beyond Islam as the raison d’être of the state.

Finally, there was the hope that Pakistan and especially the Pakistan army would also transcend its pathological India hostility. To prevent a Versailles type syndrome (the combative nationalism that was witnessed in Germany after its humiliating defeat in the World War I) Indira Gandhi not only treated Bhutto with utmost respect and regard at Shimla, but agreed to repatriate thousands of Pakistani Prisoners of War without any conditions and did not insist on a written agreement on Jammu and Kashmir. P N Haksar, Indira Gandhi’s adviser with a great sense of history apparently was principally instrumental in ensuring that Bhutto went back after Shimla, a hero to his people rather than a discredited leader of a defeated nation.

In retrospect, these expectations were either misplaced or subsequent Indian policies did not build sufficiently on the 1971 and 1972 achievements. Not only was Indian power not recognised in the years after 1971 by Pakistan, but also many of the smaller states, including Sri Lanka, thought of crafty ways of challenging Indian dominance. In the years that followed the assassination of Sheikh Mujib (the father of its independence movement), Bangladesh itself became — in cycles — a source of grave instability for India and was once the favourite hunting ground of ISI agents. The jury, unfortunately, is still out on whether the current bonhomie in bilateral relations will outlast present Prime Minister Sheikh Hasina’s tenure. In Pakistan itself, the Bangladesh War — contrary to Haksar’s hopes — became the new Versailles. The Bangladesh syndrome arguably produced the policy of ‘bleeding India with a thousand cuts’ as avenging 1971 became the principal unstated doctrine of the Pakistan army. Changing borders was no longer taboo, and Bangladesh gave a perverse institutional legitimacy to Pakistan army’s designs to do the same to India.

Religion instead of becoming epithermal to the Pakistani state, overwhelmed it. General Zia-ul-Haq’s years (that followed the military coup against Bhutto) led to a new radicalisation (aided by the Afghan war) and produced a generation of extremists that have permeated into all institutions of the state, including the army. Bhutto himself reneged on any understanding on Jammu and Kashmir that he may had in Shimla, and subsequent leaders of Pakistan helped to create the monster of militancy (aided by our own follies) in J&K that has almost permanently scarred the psyche of the people of the state.

In sum, as we celebrate a milestone in the history of nation — which we hope will be peaceful and prosperous — the Bangladesh syndrome is more than just about victories and agreements. Bangladesh perhaps teaches us that unless political, diplomatic, economic and social initiatives build on military victories, they can remain ephemeral.

(Source: The New Indian Express)

Building block of a new phase in bilateral ties?

Australian Prime Minister Julia Gillard’s recent announcement of support for the sale of uranium to India could well be a catalyst for a strategic breakthrough in relations between Canberra and New Delhi. Indeed, while the “uranium decision” may not have a great impact on India’s energy needs, it could have far-reaching consequences for security and strategic stability in the Asia-Pacific region.

While the proposal to export uranium will need to be endorsed at the Australian Labor Party national convention next month, its passage appears to be a mere formality, despite expected opposition from the party’s left wing and autonomous bodies like the Australian Conservation Foundation. With the sale in force, Australia would become the sixth country in the world, following Russia, Mongolia, Kazakhstan, Argentina and Namibia, to enter into a formal uranium supply arrangement with India.

What does this new development portend for India’s energy security, especially its ambitious plan to ramp up domestic nuclear power production by more than an order of magnitude in barely two decades, and for the future of India-Australia relations? Nuclear power currently provides approximately four per cent of India’s generation mix, which is dominated by thermal and hydroelectric power, which collectively contribute 90 per cent of the total. India has approximately one per cent of the world’s economically viable reserves of uranium (Australia correspondingly has 40 per cent). Under such circumstances, a sale of uranium to India would make eminent economic sense, were it not for the complexities associated with the downstream uses of uranium.

For India, the immediate benefit of enhanced uranium supplies from Australia would be the supply of high-grade uranium requiring little remediation before use in nuclear reactors. Bilateral trade between the two countries will witness no significant qualitative change. The current trade balance is strongly tilted in Australia’s favour, with coal and gold being the dominant constituents of the export basket to India. All other things remaining the same, the trade difference will only increase in Australia’s favour and is unlikely to change unless value-added products constitute a larger share of India’s exports. All in all, the techno-economic implications for India of uranium supplies from Australia are limited. In addition, the stringent safeguards that Canberra is likely to demand, as part of a bilateral agreement, may invite a political and scientific backlash in India, and New Delhi will — in all likelihood — proceed cautiously.

Does Australia’s decision to sell uranium to India despite the latter’s insistence on not signing the Non-Proliferation Treaty have implications for bilateral ties and the evolving security apparatus in the Asia-Pacific? It needs to be recognised that there are historical moments in every relationship. Decisions taken at those moments can potentially transform a friendship, take it to an unprecedented new level of understanding, and in the process create the momentum for a new phase of deep strategic engagement. The Australia-India relationship has reached just such a moment of renewal and rediscovery.

As yet, despite a growing convergence of values and interests, and having two very competent High Commissioners in place, there is still little real conversation happening between key players in Australia and their counterparts in India. New Delhi and Canberra may know each other, but they still do not have a nuanced understanding of the other. Thus, in the absence of a sustained engagement at multiple levels of opinion and decision makers, even a single issue can derail bilateral ties, as was witnessed during the attacks on Indian students. This needs to change if the two countries have to work with each other in their own mutual interest, and in the interests of the wider region.

Take the case of India. At the official level, there are no more than one or two officers in the severely short-staffed ministry of external affairs who pay attention to Australia, and rarely for more than a couple of hours a week. It requires great persistence for Australian officials and diplomats to secure high-level attention from India, and this lack of real communication even at the government-to-government level does undermine the political relationship.

In Australia, while the problems are different, they are equally debilitating for the relationship. On the one hand, there is undoubtedly a collective desire to see improved relations with India. On the other, Australia is excessively cautious about not offending China as it builds a relationship with India. For instance, Australia’s decision to disconnect from the quadrilateral dialogue with India, Japan and the United States, to assuage Beijing’s nervousness, was arguably short-sighted.

Moreover, the Australian understanding of India, with all its complexities, is severely limited. Till about three decades ago, Australia could claim to be one of the principle centres in the world for the study of India, in various disciplines, and some of the most exciting work on India came from Australian universities. The Subaltern school of scholars is just one example. Not any longer. The study of India in Australia today is in deep decline and little effort is being made to revive departments that had once flourished.

The reality today is that Australia and India have more in common with each other, than perhaps at any time in the past. There is also a greater need and urgency to work with each other. The economic relationship is rapidly growing and will continue to remain robust in the foreseeable future. Strategically, both countries need to work to develop stable and cooperative security architecture for the Asia-Pacific. Such an arrangement would necessarily include China, to ensure that its rise is not disruptive. What has been missing is a “strategic breakthrough”.

A decision by Canberra to sell uranium would symbolically convey to India Australia’s willingness to genuinely invest in the relationship. This could be the building block of a new phase in bilateral ties. More importantly, there needs to be far greater political and intellectual engagement between the two countries. While a new forum for business leaders has been announced, there also needs to be a platform for political leaders and opinion makers from both sides. The Australia-India relationship is an idea whose time has come; it would be a historical tragedy if the leadership of the two countries did not grab this opportunity.

(co-written with Rajeev Anantaram)

(Source: Business Standard)