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Thriving against the predictions

At the very least, Prime Minister Manmohan Singh’s three-day official visit to China has contributed incrementally to the maturation and diversification of a bilateral relationship that has done hearteningly well over the last two decades, notwithstanding ideologically driven subjective interpretations that suggest the contrary. It resulted in the signing of ten documents, the most important of which was “A Shared Vision for the 21st Century,” and the ann ouncement of ten additional non-documentary outcomes. The key formulation, the defining theme of the visit was that the India-China relationship in this Asian century would have a “significant regional and global influence,” and further that the friendship and common development of the two largest developing countries would have “a positive influence on the future of the international system.” The vision document goes on to characterise India-China relations as a relationship of friendship and trust, based on equality, in which each partner is sensitive to the concerns and aspirations of the other, and not targeted at any other country. The Strategic and Cooperative Partnership for Peace and Prosperity that was established during Premier Wen Jiabao’s visit to India in April 2005 is certainly thriving against the trend of predictions by the ideologically allergic who can see only ‘trust deficits.’

There have been incremental political gains, notably China’s commitment to promote bilateral civilian nuclear cooperation consistent with its international commitments and its support for “India’s aspirations to play a greater role in the United Nations, including in the Security Council.” The planning of more top-level visits in 2008-2009, the decision to have the Foreign Ministers visit each other’s country in 2008, the establishment of a Business Leaders Forum, the holding of joint military training exercises, the launch of a joint medical mission, and the initiation of joint science and technology projects in four identified areas testify to the assurance, range, and depth the bilateral relationship has acquired. India-China relations might not have graduated to a stage where annual summits, on the India-Russia pattern, will be held. But the reality is that every few months, the top leaders of the two countries hold talks on the sidelines of multilateral meetings.

Economics, as Dr. Singh noted, has become a principal driver of the relationship; and the solid, sustained growth of the two largest developing countries against the backdrop of growing uncertainties in the world economy is “in the nature of being an international public good.” China’s, and India’s, investment in the other country may be nothing much to talk about yet — but bilateral trade is galloping ahead. China is already India’s second largest trading partner and the stage has been set for exploring the prospects of a Regional Trading Arrangement. The value of bilateral trade in 2007 was $38.6 billion. With the target of $20 billion set for 2008 reached two years ahead of schedule and the revised target of $40 billion by 2010 likely to be reached by 2008, an enhanced target of $60 billion by 2010 has been set during the visit. Some concern has been expressed over India recently running up a sizeable trade deficit with China, upwards of $10 billion in 2007. It is unlikely that this situation will be transformed any time soon. First, the issue relates to the structure of the bilateral trade. Secondly, as Dr. Singh noted in his address to Indian businesspersons in Beijing, while there were some elements in government policy that hurt the competitiveness of Indian industry and needed to be rectified, “the deficit has to be corrected…by building the strength of Indian industry…[which must] think big.” Thirdly, there are specific trade issues that need to be addressed by both sides. Finally, in this age of globalisation, it is the aggregate picture that matters for a large economy when trade deficits and surpluses are discussed.

It is worth recalling two decades on that the breakthrough that made all this possible was a political accord forged — at the initiative of Deng Xiaoping — during Prime Minister Rajiv Gandhi’s December 1988 visit to China. The accord, which was elaborated and firmed up in bilateral agreements signed in 1993, 1996, and 2003, was that while the two sides would do their best to arrive at a fair, reasonable, and mutually acceptable settlement of the longstanding boundary dispute, they would maintain “peace and tranquillity” along the Line of Actual Control (LAC) pending a settlement. Meanwhile, the differences would not be allowed to obstruct the all-round development of India-China relations. Progress towards a package settlement, attempted in numerous discussions, Joint Working Group sessions, and 11 rounds of Special Representative-level talks, has been snail-paced. Interestingly, the Special Representatives, National Security Adviser M. K. Narayanan and Executive Vice Minister Bai Bingguo, have been re-instructed to “complete at an early date the task of arriving at an agreed framework of settlement.” This they must do on the basis of the Agreement on Political Parameters and Guiding Principles for the Settlement of India-China Boundary Question signed in April 2005. Nobody seriously expects the United Progressive Alliance government to pull out of its hat, before its elected term is over, a final package settlement of this highly sensitive question ‘left over by history.’ A fair, reasonable, and mutually acceptable boundary settlement can come only through give and take, by whatever name called. ‘Giving’ large areas of territory held, or agreeing to significant transfers of population across the LAC, does not seem to be politically feasible for either country. An agreed framework of settlement that is politically saleable will certainly be a big feather in the cap of the UPA government.

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