PoK, Here We Come!

Pakistan Occupied Kashmir, Here We Come!

The informal summit at Mahabalipuram, Tamil Nadu, has some unremarkable, if solid, agenda items. But these could have appeared in any bilateral state visit between the heads of government of India and China. These concern trade, investment, technology, tariffs, visas, broad-based terrorist threats and so forth.

Such matters can, and do, also get taken up at other venues and summits that dot the annual calendar. These, jointly and severally, afford handy delegation level talks on their sidelines.

But an informal summit like the one in Wuhan, China, and the one now, which allows several hours of one-on-one informal meetings, can work on medium term strategic issues better than most other formats.

The defensive positions and formal reservations can be set aside as already read, as both leaders come to them extremely well briefed.

The type of work they individually and jointly do at such summits therefore, may not emerge into the official lexicon on either side, let alone the public domain, for a considerable time after.

Even if certain sensitive things are agreed upon, the enabling actions that are put into motion, also take time to fructify.

But, as a consequence, these confidential tete a tetes as a diplomatic construct, can truly tackle game-changer issues.

Which is possibly why India and China have begun to hold them soon after the lengthy stand-off at Doklam.

In a broader context, that is no doubt impelling, China is under considerable financial pressure and stress even as its economic growth has halved from peaks of a few years ago. This is a widely held perception in strategic circles, though details of how tough the situation is are hard to come by, given China’s opaque systems of governance.

But, it is safe to assume that China carries massive debt, most of the legacy amounts from its high growth years being internal debt, as otherwise, if it were external, the world would be privy to it. Suffice is to say, its foreign exchange dollar/euro reserves, though it runs into trillions, is not even a fraction of what is the position here.

There is also the massive amounts owed to China by a host of impoverished or fairly poor nations that have availed of China’s offer to build large infrastructure in their countries. Yet other countries have sold China their land and mines. China’s ongoing liabilities are considerable without commensurate revenues to balance it.

That China has obtained masses of such infrastructure on long lease in these countries when they have been unable to pay instalments against their debt, inclusive of tax holidays and other favorable terms, does not, as yet, help its cash flow. Nor does it make China popular in this day and age, because it smacks of colonial style imperialism.

Nevertheless, to get this reality going into economic viability, China needs people to use, and pay for the facilities they have created. But even a couple of years after Hambantota and Gwadar are operational, next to nobody has come to call at these ports.

In the case of Gwadar, the resentment against both the Pakistanis and Chinese felt by the Balochis makes it a volatile prospect for trade that needs to pass from that port through and from Pakistan.

In the case of Sri Lanka, nobody else seems to want to use a Chinese port, when China has gone out of its way, in the garb of helping, to menace most of the countries bordering the South China Sea, and even further afield in the Asia-Pacific and Indian Ocean region.

The China Pakistan Economic Corridor (CPEC), that will absorb at least $ 60 billion of China’s money, is also in financial trouble. Investment from China has slowed of late as a consequence, and the costs of keeping what has been put on the ground secure have risen exponentially. It is also extremely vulnerable to a conventional war between India and Pakistan. This could well be provoked by cross-border terrorist attacks and the belligerence against India of Pakistan’s armed forces along the international border or line of control (LoC).

Pakistan, on its part, is unhappy that the CPEC has not generated very many Pakistani jobs, or contributed substantially to its economy while saddling it with massive debt. A politically unstable Pakistan, run, de facto, by its all-powerful army, is near bankrupt. It is totally dependent on loans from the multi-lateral lending agencies, and China. Aid is also taken from whichever quarter it can secure it. This makes the future prognosis even bleaker.

Besides, like the Palestinians before them, fellow Islamic nations are reluctant to fund Pakistan. It is widely seen as a basket case and bottomless pit, that carries the opprobrium of being terrorist central too. America’s strategic dependence on Pakistan, because of its long standing involvement in Afghanistan has diminished. And this to the extent that the US is pulling out of the region irrespective of the consequences.

The prospect of piggybacking on an “Islamic nuclear capacity” is no longer as alluring as it once was, given the fate that engulfed Col. Gaddafi of Libya, and the pressures being exerted on would-be nuclear Iran.

And using seconded or retired Pakistani troops, trainers and advisers, in Saudi Arabia and the UAE, has not yielded very good results versus the Houthi rebels, or even for routine security work internally.

As Pakistan’s sole benefactor cum colonizer today, things are not going very well financially for China. It is forced increasingly, to protect its sunk investment, to prop up the Pakistani military with money, planes, guns, and tanks. This, at its own expense, to all intents and purposes.

China’s tariff negotiations with the US, its biggest export market still, are not going very well either. President Trump is determined, like none other before him, to wring unprecedented concessions out of the People’s Republic. This is altering the status quo drastically. This more so because Chinese exports to a slowed US economy, and a recessionary Europe have dwindled over the last several years. There is little upside in prospect even in the medium term. 

China’s production costs have also risen substantially occasioning many foreign manufacturers to emigrate to Vietnam, Bangladesh, and India. It is in urgent need of finding other markets, and India, with its size and population, is a good prospect despite a handsome trade surplus in China’s favour already.

India, on its part, has steadfastly refused to join China’s belt and road initiative, unlike Nepal, because  the CPEC runs from Xinkiang via PoK and Gilgit-Baltistan, which are both Indian territory that it intends to reclaim. This, more so, after the abrogation of Articles 370 and 35A and the reorganization of J&K into two union territories for now.

In is thought, in the strategic thinking of the Government of India, that it is impossible to remove  Pakistan’s Kashmir obsession till the rest of the territory is reclaimed from Pakistani occupation as well.

India has vowed to do so of late, at the opportune time. It has also made it clear to China that any infrastructure it has built, or is in the process of building in PoK and Gilgit-Baltistan, is without its expressed permission. This includes the road and associated infrastructure, a dam in PoK and so forth. The native people of the region are also unhappy with the Pakistani-Chinese occupation and want to revert to India at the earliest.

The time is ripe therefore, and perhaps the matter has been, or will be, discussed between Prime Minister Narendra Modi and President XI Jinping at Mahabalipuram.

If China tacitly approves of India reclaiming PoK/Gilgit-Baltistan and uses its good offices to hold Pakistan to a token resistance; a case can be made for India joining the belt and road initiative in return.

This will give new life and strength to the whole enterprise, without  compromising China’s abiding support to its ally Pakistan, and  the latter’s legitimate territorial integrity.

That Baluchistan that contains the port of Gwadar, will chafe at the bit and seek independence from Pakistan, is a real, if separate, issue, and China will have to come to terms with it later, perhaps in league with India.

However, subduing Pakistan’s aggressive instincts, its calls for jihad, including its cross-border terrorism, is as much in China’s best interest as India’s.

 Trade cannot flow between Xinkiang and Gwadar, and all points of the compass within India, and via Pakistan, if peace and tranquility is not secured. China can make this happen, if it undertakes an about turn from the long held policy of using Pakistan to bait India.

(1,418 words)

For: Sirfnews

October 12, 2019

Gautam Mukherjee

The Shingle Is The Same,But Everything Is Changed

The Shingle Is The Same, But Everything Is Changed

Ancient civilisations have a predilection for retaining the markers of the ages they inherit. Rome is always careful to leave its ambience as the “eternal city’’ undisturbed. China reveres its storied and ancestral past, and is loathe to rip apart even its modern ideological structures. This, also if they have outlived their purposes in certain areas. India has always been a confluence of cultures and ideas. These have formed and travelled both outwards and inwards in a wide arc of influence and inspiration. To not take this along into the future, even as perversions are corrected, would not do its essential ethos the justice it deserves.

The People’s Republic of China is today a considerable capitalist success, second only to the US in terms of the size of its economy. It is still Communist, in name, and political organization; but no longer in terms of its economic policies.

This change has been wrought since the 1980s, under the guidance of its late great leader Deng Xiaoping, who decided to change direction. This, after the collectivisation failures and excesses of the Mao era came to an end with the Chairman’s death. Particularly, since it did not add much economic value, and was marked and scarred by a tremendous cost in human suffering. Chairman Mao’s administration, since 1949, is credited with having killed over 30 million of his own people.

China has made quick economic strides since the 1980s, with 30 years of continuous double-digit growth, using its version of the dictatorship of the proletariat.

However, it was helped in this spectacular performance, by not allowing for the tumult of democracy. Since 1997, it has had to endure the freedoms of democracy, in a limited way, and as an exception, in Hong Kong. This, of course is due to historical reasons, because the island was under British colonial administration for a very long time. This may have been authoritarian too, but European democratic ideals, and the principles of free trade were taught, revered, and were, to some extent, implemented. Hong Kong was, and is, a dynamic trading citadel.

Having got Hong Kong back in 1997, after 156 years, under the treaty obligations signed by an imperial Britain with Qing China post the Opium Wars, China has tried to proceed with delicacy and caution.

Even now in 2019, China continues to profess a principle of “one nation, two systems”, for the benefit of the advanced and sophisticated people of Hong Kong and the sake of their promised autonomy. However, it has been tightening its grip over the island very gradually over the years.

But now, its centralised ways are facing embarrassing opposition from the residents, who think very differently from those who live and work on the mainland.

China’s stiffening stance under President Xi Jinping, might be because it calculates that it can afford to substitute very successful Shenzen, on the mainland, in place of Hong Kong, and not suffer in terms of connectivity and trade with the rest of the world.  But, as may be expected, the people of Hong Kong are not amused. Most people in Hong Kong however, particularly the wealthy, have seen the writing on the wall, and are emigrating to other countries, including Singapore and Canada.

In addition, scant miles away from Red China is Taiwan, formerly the island of Formosa- now constituting all of The Republic of China, which is democratic, and fiercely independent of the mainland.

The vagaries of history may have to answer for why Red China continuously claims Taiwan to this day. But, it is a separate country today, recognized by the whole world, and backed in its independence by the US. It was born after Generalissimo Chiang Kai Shek and his Nationalists fled the mainland after losing the fight to Mao Tse Tung and his Communists in 1949.

So China lives cheek by jowl with democracy, both within its own territory in Hong Kong, and in the lost territory of Formosa/Taiwan. But it manages to follow a different drummer ideologically for itself.

It has long been speculated how long China can hold out before its masses reach out for more political freedom despite considerable prosperity compared to the old days. But for now, under President Xi Jinping, things seem to be in control. A repeat of the Tianeman Square protests of 1989 seem unlikely on the surface. Although a slowed economy, running at half of its boom years in terms of GDP, the tariff wars with its biggest export market in the US, and massive national debt, could fuel unrest at any time. The world is perpetually running blind to a certain extent when it comes to China, and will only find out if anything comes out in the open.

India too is going through a transition. It is redefining the meaning of secularism and socialism inserted into the preamble of the Indian Constitution during the Emergency of the 1970s. From the early days after independence in 1947, a Hindu majority country was seen to pointedly favour its minorities. 

This was the norm for decades, and led to a distorted sense of both entitlement in certain quarters, and glaring exclusion in others. The unfairness of the situation was not thought to be remarkable. In fact, the people of the country were lectured and hectored to shun majoritarian tendencies.

The present government is actively engaged in rectifying the situation with the enthusiastic backing of over 40% of the electorate. In fact, if the NDA allies are counted, the percentage is closer to 50%. The remainder of the votes are fragmented and no other political entity can boast of much more than 30%, if that.

This transitionary period is not without its share of heartburn, particularly as the once mighty and seemingly all- knowing have been replaced by the electorate.  In economic policy too, the earlier dispensation professed to spend on the upliftment of the poor, even as it neglected the engines of growth. This led to runaway inflation, as expenditure bore no relationship to income, in a deficit fueled and extremely corrupt administration. The money for the poor only saw under 15% of it reaching its destination.

Today, the welfarism continues but so does growth. And the benefits for the poor reach them in every instance without middle-man pilferage.

In a very telling way, both secularism and socialism have come to mean very different things today. Secularism is now an even playing field for all. 

Hinduism is allowed its rightful place in the public discourse without imposing on any of the other religions. But by the same token, manipulated and forced conversions are being checked. However, because of decades spent with a tilted outlook, evening the balance may look revanchist to those who have been dispossessed of their authority. This is not right, despite the caterwauling, but can nevertheless be understood.

In a sense, both India and China have decided to retain the framework created and established by their founding fathers, while modifying the content to suit present times and the demands of the future.

The recent changes in J&K however have shown up the limitations of retaining unfair legal structures. So, in a way, the conversions made there must be seen as exceptions that prove the rule. There is a new secularism, a new socialism, as practiced by a renewed and resurgent India.

China is on its way to seeking global leadership based on its considerable success. This, of course, is not without its obstacles. India, on its part,  is busy course-correcting internally as much as externally to remove the impedimenta to its future greatness. It is also determined to seize its leading position in the comity of nations, economically, politically, militarily and culturally.

Will there be increasing convergence between the two Asian giants? Rivals, even senior and junior ones, will never converge, and so this seems unlikely. A transactional cooperation, yes, will increase as the time goes on, but good fences always make for good neighbours.

(1,324 words)

October 2, 2019

For: Sirfnews

Gautam Mukherjee