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The choice before China

India would be amongst the major gainers of companies moving out from China.

Harsha Kakar | New Delhi |

The India-China standoff in Ladakh continues. Talks at the highest military level have ensured that physical violence between the two armies remains contained.

The final resolution will flow through diplomacy and can never be rushed. Forces from both nations have dug in with matching strengths. India has announced that it will not buckle under Chinese pressure and will continue enhancing its infrastructure development in the region.

India has never sought any nation’s territory, nor will it sacrifice its own. Whenever India faces a crisis, nationalism rises to the fore.

Within India, calls to boycott Chinese products including its apps is gaining ground, hurting China. The programme which enables detection and removal of Chinese apps had witnessed over a million downloads in less than a week before being disabled by Google Play Store, on China’s request.

The Global Times, conveying Chinese concerns, stated on 2 June, “If the Indian government allows the irrational anti-China sentiment to continue ruining bilateral relations, it is likely to draw tit-for-tat punishment from Beijing.” China is worried.

China currently has a large share of the Indian market, especially of its cheap electronic goods. Its Xiaomi mobiles alone possess 30 per cent share of the Indian mobile market and its One Plus series was India’s No 1 brand in 2019.

India is a large market with its middle class possessing immense purchasing power, which China cannot afford to lose. With the global economy shrinking, China needs its hold in the Indian market to survive. If this boycott gains ground, Chinese exports would be impacted and along with it, its economy. Simultaneous is the call by the Indian Prime Minister to ‘be vocal for local.’

In India-China relations, economic cooperation and unilateral military actions cannot go hand in hand. China must determine what it desires. It cannot apply military pressure on one hand and seek economic cooperation with the other. It must choose between needing Indian markets or pushing for a military showdown.

Even if the Indian government maintains silence, nationalism will ensure Chinese products are rejected. The support to Amul’s tweet of boycotting Chinese goods is a case in point. China is also worried about the emerging trade war with the US, while projecting a brave face. The US has already made Huawei, a prime Chinese concern, redundant by blocking supply of microchips to it. Huawei stated that the company is in for hard times.

India which was considering Huawei for its 5G market would now change its mind. Chinese companies in security-related sectors can never be trusted. China fears India may join the US, adding to its economic woes.

The Global Times published an op-ed subtly warning India against taking advantage of the ongoing trade war. It stated on 31 May, “India needs to be careful about being involved in US-China rivalry,” adding: “Fundamentally speaking, India has little to gain from engaging in a US-China conflict over any topic, with more to lose than gain.”

China fails to understand that the more aggressive it attempts to be, the stronger would be Indian response. It has witnessed that in Doklam, is witnessing it currently and would witness it in trade ties too.

Every nation follows its national interests and if India’s national interests involve siding with the West to isolate China, then so be it.

Despite the standoff, China continues to profess friendship as stated by the Global Times on 5 June, “We have no reason to make India our enemy.” Can China be trusted? In the middle of a growing trade war and increased pressure on companies from Europe, Japan and the US to shift manufacturing from China, its economic woes would increase.

India would be amongst the major gainers of companies moving out from China.

The government is already offering sops to Indian medical manufacturers to reduce dependency on China for API in drug manufacturing.

India will move towards self-dependency. While China managed some reprieve in its trade battle with the US due to its internal violence, this would be short lived. With violence receding, US pressure on China would reemerge with a vengeance.

Expansion of the current G-7 to G-11/12 as a counter to the G 20 and India’s willingness to be a part of it indicates India will not toe the Chinese line unless China displays maturity. When questioned on the US decision to expand G-7, the Chinese spokesperson, Zhao Lijian stated, “We believe this is the role of the overwhelming majority of the countries in the world. Any attempts to seek a small circle against China is doomed to fail and is unpopular.” China realizes that India joining this group would add to its isolation.

The Global Times commented on 5 June, “if India hastily joins a small circle that perceives China as an imaginary enemy, China-India relations will deteriorate. This is not in India’s interests. The current bilateral relations have already been on a downward trend.” However, if China continues its immature and self-destructing actions, India will act according to its own interests. China has not learnt from its Australia gamble.

It attempted to bulldoze Australia by offering two choices – either stop accusing China, implying sacrificing its principles, or face economic actions. Australia chose principles. India has not yet come to that stage, as it maintains maturity in its dealings with China. It expects China to reciprocate; however, if it does not, India may be compelled to choose.

Threats are not a solution in the long term, especially if the nation is not a pushover. India is neither a small Asean nation which could be browbeaten by Chinese pressure nor one of its lackey states like Pakistan or North Korea, which survive on Chinese largesse.

India is seeking resolution of the standoff, not from a position of weakness but from a position of equality. Its desire to avoid escalation should never be mistaken for its weakness. It is no longer the nation of 1962, but one far stronger than in 1967. The choice remains China’s.

The writer is a retired Major-General of the Indian Army.