Modi’s US policy: Can India shape an Asian Century without China?

  • Sushil Aaron, Hindustan Times
  • Updated: Jun 10, 2016 18:37 IST
Notwithstanding close ties to the US, India should remain alert to the opportunity and risk that China represents and nurture a narrative that reflects both adequately. (AFP)

Narendra Modi is pushing India-US ties in ways that work at cross purposes with the objectives of the India-China relationship. He should realise that many countries, including the US, continue to advance ties with China while expressing concerns about Beijing’s territorial ambitions. India’s interests are not served by settling into an adversarial relationship with China.

Prime Minister Narendra Modi has again underlined his preference, when it comes to deciding between Washington and Beijing. Via three summits and seven meetings with US President Barack Obama in two years, Modi has decisively lurched India into the US orbit, consolidating steps to bring the two sides closer — a strategy initiated by the previous Manmohan Singh government.

In January 2015 India and the US agreed on a Joint Strategic Vision for the Asia-Pacific and Indian Ocean Region to promote “peace, prosperity and stability in those regions”. Amid a fluid Asian landscape that was coming to terms with China’s rise and territorial assertion, New Delhi endorsed Washington’s views on the importance of freedom of navigation and over flight throughout the region, “especially in the South China Sea” Following through, India and the US have, as part of expanded military-to-military ties, finalised the text of a logistics support agreement where both countries can avail of support facilities in each other’s territory, confirming at least in Beijing's eyes that this bilateral surge is about China, as this Global Times article shows.

There are, of course, sound reasons for India to forge closer ties with the US. As the September 2014 India-US joint statement indicates, Delhi sees the US “as a principal partner in the realisation of India’s rise as a responsible, influential world power”. India looks to the US as a source of investment, weapons, high technology and expertise in several areas including agriculture, education, health, energy and space. It wants to leverage Washington’s influence in international institutions for its purposes and values American counterterrorist cooperation and intercession with Pakistan.

There’s also a strong social impetus for closer ties. Thanks to the precipitous decline in its education system, a significant chunk of India’s elite are sending their children to the US for study and work —and these are now part of a 3 million diaspora that understandably clamour for closer ties with Washington. The common English language and American soft power exercised through universities, film, music and merchandise makes it easy for people-to-people ties to thrive. The US, meanwhile, sees India as a promising market and as a potential counter to China in Asia.

Competing interests

All this would translate into a fairly stable harmony of interests if there wasn’t an explicit security edge to the India-US relationship that adversely affects China and India-China ties, notwithstanding Delhi’s anxieties about Beijing’s ambitions. As things stand, both the India-US rhetoric and direction of bilateral ties work at cross purposes with the declared objectives of the India-China relationship, which even Modi has signed on to — as recently as 2015. India will be hard pressed in times ahead to square the circle.

Take, for example, the May 2013 India-China joint statement after Premier Li Keqiang’s visit to India. It said “The two sides welcome each other’s peaceful development and regard it as a mutually reinforcing process. There is enough space in the world for the development of India and China, and the world needs the common development of both countries…Both countries view each other as partners for mutual benefit and not as rivals or competitors.” (emphasis added)

There is, in addition, language on the “promotion of a multi-polar world” in the 2013 joint statement and the one issued after President Xi Jinping’s India visit in September 2014. In fact, in the May 2015 joint statement after Modi’s return visit there is a striking paragraph on India and China’s shared outlook on world affairs:

“The leaders agreed that simultaneous re-emergence of India and China as two major powers in the region and the world offers a momentous opportunity for realisation of the Asian Century. They noted that India-China bilateral relations are poised to play a defining role in the 21st Century in Asia and indeed, globally. The leaders agreed that the process of the two countries pursuing their respective national developmental goals and security interests must unfold in a mutually supportive manner with both sides showing mutual respect and sensitivity to each other’s concerns, interests and aspirations. This constructive model of relationship between the two largest developing countries, the biggest emerging economies and two major poles in the global architecture provides a new basis for pursuing state-to-state relations to strengthen the international system.”

Whatever happened to notions of an Asian Century in the space of one year? Indian analysts have a ready answer. The incursion of Chinese troops in Ladakh while Modi was chatting to President Xi Jinping on a swing at Ahmedabad was a serious breach of trust. China will always keep propping up Pakistan to contain India. It is blocking proscription of terrorists like Maulana Masood Azhar on technical grounds at the United Nations and it is currently backing Pakistan, not India, when it comes to membership of the Nuclear Suppliers Group. Indian policymakers likely insist that Delhi’s pro-US tilt is the product of Beijing’s efforts to undercut India (and they will contest arguments which suggest that closer India-US ties over the last decade may have prompted Chinese counter-reaction).

China’s actions vis-a-vis India in recent years are legitimate grounds for alienation but it is debatable if they warrant a hiatus in high-level political contact and visible conversation – and an explicit banding with the US just when Beijing is using its brinkmanship and construction activity in the South China Seas as a way to sort its friends from adversaries. It is not clear why India cannot be an instrumentalist bystander — a strategic position, anyway, for our post-Nehruvian policymakers.

India has been lately caught in a bind by being projected by others as a net security provider in the Indian Ocean and primed to take on a greater role in line with its great power ambitions. The sense in Southeast Asian capitals like Singapore and Hanoi is that they were waiting for India to step up and stand up to China.

Chinese dredging vessels are purportedly seen in the waters around Fiery Cross Reef in the disputed Spratly Islands in the South China Sea in this image from video taken by a P-8A Poseidon surveillance aircraft provided by the United States Navy, May 21, 2015. (REUTERS)

Complex motivations in changing Asia

A few points worth noting in this regard. One, at the stage of development it is in, when most of India’s challenges are internal, confronting China and souring relations with its establishment is not in our economic interest.

Two, Modi must remember that for all their anxiety about Chinese expansionism, other Asian powers, including Australia, are eagerly consolidating economic ties with China. Singapore, a thought leader in Asia and one very wary of Beijing’s ambitions had bilateral trade with China worth $121.5 billion last year. Vietnam wants India to export weapons and explore oil in the South China Sea to contest China’s claims but its trade volumes with the latter are expected to reach $100 billion this year. Likewise, Australia’s strategic community is very worked up about Beijing’s adventurism but China is the country’s largest trade partner with two-way trade at A$153 billion in 2014. And US-China trade was worth $599 billion last year.

Clearly all these powers are reconciled to China being a central part of their future. India is arguably no different, maintaining a healthy trade of $80 billion in 2015 but Delhi fails to maintain a public narrative that captures both economic opportunity and political differences — it has a tendency to get into a sulk imagining unchanging Chinese malevolence, which plays its part in the slowdown of ties.

The reason Delhi needs to challenge its own adversarial lens from time to time is that strategic assumptions of today may not hold in the face of a crisis tomorrow. What form the US-China confrontation on South China Sea will eventually take is unclear. Will the US succeed in rolling back Chinese positions or acquiesce with a (new) status quo like it did in Ukraine, leaving other powers in the region confused and vulnerable? What is the guarantee that priorities in Washington will not change; some analysts like FT’s Geoff Dyer note that the Pentagon is currently more on a confrontation mode with China than the White House wants to be – and these dynamics too can change.

The principal question is why should India be party to recriminations concerning the South China Sea and invite further Chinese investment in the South Asian neighbourhood, either though active the wooing of Sri Lanka or buying land in the Maldives?

As historian and IR scholar Srinath Raghavan argues “China’s rapid military modernisation and assertive behaviour are evident. But there is little to suggest that we needed to cosy up to the US on such terms”.

He writes: “An overwhelming amount of China’s own trade flows through the South China Sea, so how is it in Chinese interests to impede freedom of navigation there? The phrase “freedom of navigation” is a euphemism for the freedom of the US navy to patrol close to Chinese coasts. By embracing it so enthusiastically, we are signalling our willingness to help uphold US naval dominance in the Asia-Pacific. The claims by some Indian analysts that the US will help ensure a multipolar Asia is naïve. The US is committed to only ensuring its own unquestioned primacy. And there are ways of leveraging American power to our own purposes without going down the current path.”

And Raghavan also mentions that the Trans-Pacific Partnership, which the US is pressing ahead along with 11 other countries, threatens to shut out India of the most dynamic economies in the Asia-Pacific owing to the high regulatory standards which India cannot meet — and so while there may be a measure of convergence on security matters India’s emerging partnership with the US in the Asia-Pacific “will stand on a weak economic leg”.

This is clearly a complex environment, where no power’s motivations, including the US, are what they seem. Each nation is looking out for itself, talking up the dragon but actively dealing with it simultaneously and India must be no different.

This is admittedly not easy for India since it has a border dispute with China; the China-Pakistan axis is a constant irritant and Beijing resists granting market access to address trade imbalances. But since India has glossed over the American funding of the Pakistan military for decades which nurtured terrorist networks that harm India ¬and since we understand Washington’s compulsions when it privileges Pakistani interests in Afghanistan at the expense of India’s (i.e. by not picking the Haqqanis as drone targets, as some in Delhi would prefer), it may similarly be useful to have a more nuanced reading of China’s motivations and strive to alter its objectives in India’s favour.

Consider OBOR

One way of practically doing so is to craft a creative response to China’s One Belt One Road (OBOR), a gigantic initiative that will build land and sea links between China and Europe through projects that build roads, railways, ports, power plants, logistical hubs and other infrastructure. Well-regarded Indian analysts have already asked Delhi to consider the merits of engaging with OBOR (see here, here, and here).

Spanning 65 countries and covering 60% of the world’s population, the trade with countries involved is expected to reach $2.5 trillion by 2025. China is investing $46 billion in the China-Pakistan Economic Corridor as part of OBOR. A large part of the initiative still is provisional at the moment as securing credit, consent of other countries, and establishing the terms of governance is a work in progress. But even sceptics will concede that this will remake Asian and world geography. According to a report by the Peterson Institute for International Economics, Chinese state banks have already invested more than $250 billion in new projects; in the first half of 2015, Chinese companies signed 1,401 project contracts worth $37.6 billion. “At maturity, investment in the Belt and Road is expected to reach $4 trillion, equivalent to China’s 2015 foreign currency reserves.”

A map illustrating China's "One Belt, One Road" initiative at the Asian Financial Forum in Hong Kong, January 18, 2016. (Reuters / Bobby Yip)

India has so far not expressed an interest in OBOR and is pretending that it can work with alternatives like Chabahar — which are effectively trifle investments given the scope of Chinese ambitions. The OBOR is grand in conception but specialists argue that it also faces uncertainties like failed timelines and low returns of investments in sparsely populated countries like Central Asia or violent ones like Pakistan. In such a scenario, India stands as an opportunity for China and vice versa. For India to steer clear of an enterprise of such scale is to be blissfully unmindful of an Asia that will soon emerge.

To summarise, India needs a level-headed analysis of great power motivations in a changing Asia, it should remain alert to the opportunity and risk that China represents and nurture a narrative that reflects both adequately. It can be wary of Beijing’s ambitions and extend the scale and breadth of military partnerships in the region —including with the US — but without being drawn into everyday battles that are not necessarily ours.

China is, to be sure, an awkward customer to handle. But tackling it requires dexterity, expertise and stamina. Rushing in to de facto alliances on terms that don’t always suit us is the lazy way of doing foreign policy.

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