Thursday, April 26, 2018

Narendra Modi-Xi Jinping meet: China is 'wooing' India because Donald Trump's moves have left it no choice

- As Narendra Modi lands in Wuhan for a much-anticipated one-on-one with Xi Jinping, it is worth exploring the motivations that have driven China to the discussion table. It is a stretch to assume that Beijing, which refuses to consider India as its equal and never fails to be condescending about the economic and military power differential, would suddenly warm up to its neighbour out of "goodwill". China doesn't do "goodwill".

Its actions (not just under Xi but specially under him) are guided by a pragmatic cost-benefit ratio, and are based on a Sino-centric geopolitical strategy that seeks — through assertive maritime, expansionist and revisionist policies — to restore the Middle Kingdom to its "lost glory".

As Stratfor contributor Zhixing Zhang writes in Forbes: "Beijing's assertive maritime policy is an attempt to secure its access to overseas markets and prevent a challenger from emerging to threaten its multiplying interests around the world. And like the Han and Tang dynasties before it, China today will run up against other empires as it pursues its geopolitical strategy in the surrounding region and farther afield.

A 'great power aspirant' that aims to challenge and eventually replace America's global dominance in every field from ideology, culture, geopolitics, military, technology to political system and economy — replacing the dollar with renminbi as the premier mode of global exchange for one — it is inconceivable that China would court 'middle power' India out of goodwill. Xi is more likely to interpret such a gesture as weakness.

India should be under no illusion that this "reengagement" or "reset" (whatever it's called) is borne out of China's desire to listen to India or try and understand its concerns and red lines in the path of mutual growth and development. These might be good slogans for framing the dialogue but we should look for motivations elsewhere. A good starting point would be the flux in international order and two recent developments that have thrown a challenge at Xi and diminished his ability to play the power broker in Korean Peninsula.

The first one pertains to Donald Trump's decision to impose tariffs on Chinese imports to correct an imbalance in bilateral trade. North Korean dictator Kim Jong-un's decision to suspend all testing of nuclear weapons ahead of his proposed meeting with the US president presents the second challenge for Xi. Both developments are inextricable and demand a set of hard choices from the Chinese president.

Limiting the irritants in India-China bilateral ties may result in a more manageable relationship, which in turn should allow China more legroom to exploit the world's fifth largest and fastest growing major economy. Xi's decision to sit across the table with Modi arises primarily from this compulsion.

To a certain extent, Trump's faith in direct threats than quiet diplomacy has constrained China's hands and squeezed Xi's bargaining space. The US President's move to slap tariffs worth $50 billion on Chinese imports and threats to slap another $100 billion unless China gives better market access to American firms and allows the US to export more cars, aircraft, soybeans and natural gas into China to remedy the $375 billion deficit has prompted a conflicting response from China.

Xi has made some conciliatory noises on lowering tariffs on American cars and opening the domestic market but he has simultaneously moved to impose a retaliatory $50 billion tariff on American goods, raising the spectre of a trade war.

A set of action and reactions have followed. The US has announced that it is ready to talk to China over the issue and accordingly a meeting was set up in Beijing between Xi, vice-president Wang Qishan and Chinese officials on one side and US treasury secretary Steven Mnuchin and National Economic Council head Larry Kudlow on the other on 3 and 4 May. Latest reports, however, indicate that a resolution might not be in sight. Trump has added two more hawks to the US delegation amid a buzz of "more action" against Beijing. ContinueReading

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