The rise and rise of Xi Jinpings

The rise and rise of Xi Jinpings

Context

• The 19th National Congress of the Communist Party of China showcased the primacy of President Xi Jinping. The event focused on his vision and his status thus, restoring its global leadership role on full display.

Significant importance of Me. Xi ruling

• While this self-elevation, Mr. Xi will become the principal mediator of China’s future directions over the next five years and possibly beyond.
• With Mr. Xi steadily accumulating controls of authority and eliminating rivals, there has been a shift towards personalized rule in his first term and now at the Party Congress. The erosion of checks that it involves has attendant risks for China.
• Mr. Xi has been included in the new line-up of the PBSC. This has kept open the possibility of him staying on as the paramount leader or the power behind the throne well beyond 2022.
• His preference for maintaining a strong state and party role in the economy with minimal privatization of state-owned assets and firm control over social and financial risks is unlikely to change in the wake of the Congress.
• He is also positioning China as a defender of globalization, it comes with a strong dose of mercantilism.
• For India, one key outcome of the party meeting is the articulation of China’s increasingly explicit great power ambitions.
• The preoccupation with building up global combat capabilities to safeguard China’s overseas interests also figures prominently in Mr. Xi’s vision.
• Mr. Xi has set the goal of completing modernization of the armed forces by 2035 and transforming the PLA into a world-class military by 2050.
• China is likely to intensify its efforts to shape its periphery and forge a “world community of shared destiny” centred around it. With the U.S. in temporary retreat and the West distracted by internal challenges, China considers this to be a period of strategic opportunity to take its great power project to the next level in the new era that Mr. Xi has envisioned.

The BRI gauntlet

• Mr. Xi’s Belt and Road Initiative (BRI) is the key instrument embedded in the party constitution. There is nothing to suggest that China is inclined to address India’s concerns about the BRI.
• In a development possibly linked to China’s enhanced global agenda, for the first time since 2003, the Politburo includes a diplomat, State Councillor Yang Jiechi, as the Chinese special representative for boundary talks with India.
• It may also be noted that since his 2014 visit to India, President Xi has emerged as the principal Chinese interlocutor for Prime Minister Narendra Modi.

Way ahead

A more assertive China will be one of the most critical factors shaping India’s external environment, apart from engendering new challenges in the management of bilateral relations, more so as the footprints of the two re-emergent countries will increasingly overlap.

India – China

Background

• India – China relations have undergone dramatic changes over the past five decades, ranging from the 1950‘s with a deep hostility in the 1960‘s and 1970‘s to a rapprochement in the 1980‘s and a readjustment since the demise of Soviet Union.
• The modern relationship began in 1950 when India was among the first countries to end formal ties with the Republic of China and recognize the PRC as the legitimate government of Mainland China. China and India are the two most populous countries and fastest growing major economies in the world.
• India and China are playing an increasingly important role in the world economy. A better relationship would boost trade ties, investments and employment in the two countries, and even augment global growth.

India – China Policies

• With the independence of the Republic of India and the formation of the People’s Republic of China (PRC) in the year 1949, one of the policies for the Indian government was that of maintaining cordial relations with China
• When China announced that it would be occupying Tibet, India sent a letter of protest proposing negotiations on the Tibet issue.
• China was even more active in deploying troops on the Aksai Chin border than India.
• India was so concerned about its relations with China that it did not even attend a conference for the conclusion of a peace treaty with Japan because China was not invited.
• India even strove to become China’s representative in matters related to world since China had been isolated from many issues
• In 1954, China and India concluded the Five Principles of Peaceful Coexistence, Panchsheel, under which, India acknowledged Chinese rule in Tibet.
• It was at this time when former Prime Minister of India, Jawaharlal Nehru promoted the slogan “Hindi-Chini bhai-bhai”
• In July 1954, Nehru wrote a memo directing a revision in the maps of India to show definite boundaries on all frontiers; however, Chinese maps showed some 120,000 square kilometres of Indian territory as Chinese. On being questioned, Zhou Enlai, the first Premier of People’s Republic of China, responded that there were errors in the maps
• Top People’s Republic of China leader, Mao Zedong felt humiliated by the reception Dalai Lama obtained in India when he fled there in March 1959.
• China’s perception of India as a threat to its rule of Tibet became one of the most prominent reasons for the Sino-Indian War
• In October 1959, India realized that it was not ready for war after a clash between the two armies at Kongka Pass, in which nine Indian policemen were killed; the country assumed responsibility for the border and pulled back patrols from disputed areas
• Various conflicts and military incidents between India and China flared up throughout the summer of 1962
• On July 10, 1962, around 350 Chinese troops surrounded.

Commercial relations

• Trade volume between the two countries in the beginning of the century, year 2000, stood at US$ 3 billion.
• In 2008, bilateral trade reached US$ 51.8 billion with China replacing the United States as India’s largest “Goods trading partner.”
• In 2011 bilateral trade reached an all-time high of US$ 73.9 billion.
• In 2016, India’s top exports to China included diamonds, cotton yarn, iron ore, copper and organic chemicals.
• In 2016, China exports of electrical machinery and equipment saw an increase of 26.83%to US$ 16.98 billion.
• India was the largest export destination of Fertilizers exports from China.
• There are three border trade points between India and China viz. Nathu La Pass (Sikkim), Shipki La Pass (Himachal Pradesh) and Lipulekh Pass (Uttarakhand).

Investments

• According to data released by China’s Ministry of Commerce, the Chinese investment in India in Jan-Mar 2017 were to the tune of US$ 73 million.
• Cumulative Investment in India till March 2017 stood at US$ 4.91 billion.
• According to data released by China’s Ministry of Commerce, the cumulative Indian investment in China till March 2017 reached US$705 million.

Economic Relations

• India-China economic relations constitute an important element of the strategic and cooperative partnership between the two countries.
• Several institutional mechanisms have been established for enhancing and strengthening economic cooperation between the two countries.
• In accordance with the MoU signed during Chinese Premier Wen Jiabao’s visit to India in April 2005, the two sides have since successfully held eight Financial Dialogues in April 2006, December 2007, January 2009, September 2010, November 2011, September 2013, December 2014 and August 2016 respectively.

Recent developments

• Two developments could lead to even greater momentum for Sino-Indian economic integration.
• Larger companies in both countries are increasingly acquiring third-country companies that already have a presence in China and India.
• China hopes for better ties with India in future by resolving differences over India’s admission into elite Nuclear Suppliers Group and listing of JeM chief Masood Azhar as terrorist by the UN as the two nations signed off their most engaging year bogged down by the twin issues.
• The year 2017 has seen a steady development of China-India relations, with the two countries marching towards the goal of building a more closely-knit partnership.