software expertise and China's cheap quality hardware could make
for a beautiful and extremely lucrative partnership with political
consequences that might prove disheartening to the likes of Tibet,
Nepal and Pakistan. And perhaps also the US.
India and China have roughly $4 billion in trade between them the equivalent of the trade that flows between mighty Vietnam and
China. Russia and China exchange $20 billion annually. The room
for growth between the two giants is enormous.
countries have a vast population of barefoot peasants left completely
out of the glitter of Bombay, Shanghai and Canton. In Bombay, beggars
and yogis crowd and amaze foreign travelers with pleas for help,
body-bending acrobatics and mystical pronunciations all for
a rupee or ten. In Canton and Shanghai, the beggars are less visible
and less aggressive, but they exist; ten to a tiny room, packing
fish or hauling boxes.
India were to set up a few factories and shipping depots, they could
take advantage of China's super-cheap manufactured goods and pass
them on to the poor and destitute of interior India. China's East
Coast glitter outshines India's only star (Bombay), but new trade
cooperation could turn cities like Jaipur, New Delhi and Hyderabad
into manufacturing hubs, relieving Bombay of the crush of the masses.
for its part, needs the IT revolution to hit even harder than it
already has in order to prepare for the influx of foreign-owned
telecommunications and Internet service that is part of WTO membership.
India's advantage in terms of microchip development and design,
programming and e-commerce, provides China with a source and India
with a new Asian market.
is interesting to note that China, while courting India's software
business, is currently involved in a pivotal situation concerning
foreign investment and trade in the telecommunications sector. Goldman
Sachs and News Corp among others invested $325 million in
Netcom, a private Chinese telecom company. China then decided to
incorporate state-run China Telecom's northern provinces into Netcom,
creating China Netcom. Investors now worry about the shares will
they be returned or will they stay within the now Beijing-controlled
also recently announced a host of new regulations pertaining to
such business deals, including the need for all foreign software,
telecom and Internet providers to provide a guarantee that their
products are "no threat to China's national security and stability."
At the same time, Beijing encouraged Chinese telecommunications
companies to "buy local." Beijing also released a list
of new rules for Internet providers requiring information of users'
addresses, trends, phone numbers to cut down on "subversive
the same time, hundreds of Chinese computer-heads from the Silicon
Valley are returning to the mainland to work for more money in a
more dynamic, risky (i.e. profitable) market. So as Zhu tramps around
India trumping up software/hardware trade, the authorities back
home are clamping down on foreign investment and Internet bars,
while bringing Chinese IT talent back
economists admit they have much to learn from China's WTO campaign
and dealings with foreign firms dealings that seem to promote
trade while in effect bringing in foreign expertise to augment and
protect domestic enterprises.
50 years the two countries have had virtually no contact not
even flights. A direct flight between Beijing and New Delhi will
begin in March; previously it cost 9200 RMB to fly from China to
India over Singapore. Conversely, it costs 5500 RMB to fly from
Beijing to Minneapolis.
are but baby steps, but the political consequences for the region
and the world of this new partnership are important. First, the
Tibetans in northern India, who represent the Tibetan culture more
closely than their brethren in the Tibetan Autonomous region, may
find the Indian government less accommodating if millions (billions)
of dollars in trade are held up because of Beijing's displeasure
at their continued presence in India. A promising note on this subject
is India's "we are a democracy" retort to Beijing's demand
for a written guarantee of a no-protest zone during Zhu's visit.
a tiny poverty-stricken, rebellion-wracked nation wedged between
the two may also feel the brunt of a new alliance. The Maoists are
in the midst of an ideological ecstasy which is sustaining their
numbers and fervor for violence. India, accused by some Nepalis
of having a hand in last year's royal slaughter, has no love for
the Maoists that are moving into northwest India and gaining support
amongst the peasants there. In this new climate of anti-terrorism,
"achieving stability" in Nepal could be a bonding crusade
for China and India.
is watching these developments between the two former enemies very
closely. China and Pakistan have enjoyed a good relationship built
on military transfers and direct investment by China. Pakistani
generals were in Beijing yesterday as part of a regular visit and
met with President Jiang Zemin. Jiang reiterated China's neutral
stance concerning the conflict between Pakistan and India and claimed
that both countries are friends and partners. China looks to continue
economic and military ties with Pakistan, but not at the expense
of renewed tensions with India.
three nations seem to understand that their relationship and the
Kashmir problem should have nothing to do with each other and
so it stands
of the major catalysts for China and India renewing ties is the
arrival of the US in the region. Pakistan and the US have grown
closer since Sept. 11. Sanctions were lifted and promises were made
by both nations. China sees encirclement, India sees hypocrisy and
betrayal (Pakistan no democracy does sponsor terrorism, according
to the Indians).
China forges strong ties with India as well as Pakistan, the economic
and political profits to be gained may help to counter US dominance
to the west in what is left of Afghanistan. If the two can find
economic common ground, they could be a far more powerful engine
for Asia in the future than Japan was in the past and economics
is the source of might which has replaced force today.
interesting question is the effect of one political system on the
other. China's authoritarian system has kept domestic tension down
and separatists and dissidents in jail, while opening up the door
to foreign investment inch by inch. India's democratic system has
allowed for riots, protests and the election of a hard-line Hindu
government while the disparity between rich and poor eclipses that
effect can a comment like "we are a democracy" have for
Zhu's delegation? What can the Indians learn from China's grip on
economic and political growth?
current relationship between India and China is far too tenuous
and young to provide answers to any of these questions, but like
any new relationship, the room for growth is limitless.