Diplomatically, China is much closer to Pakistan than any other country in Asia despite regular Chinese police killing of Pakistan-backed Chinese Uighur Muslim dissidents in Western China. China is investing billions of dollars in Pakistan in ports, roads, telecommunication and defence. The reason is simple. In diplomacy, enemy’s enemy is friend. The popular adage automatically brings China and Pakistan together. China, naturally, can’t support UN action against even on a high-profile Pakistani terrorist such as Lakhvi.

Strategically, China has practically encircled India along the former’s long disputed southern borders running into a few thousand kilometers through above Ladak in India’s north-west to Sikkim and Arunachal Pradesh in the country’s north-east, Myanmar, Bangladesh to some extent, Sri Lanka, the Maldives and Pakistan with financial and physical involvement in building strategic infrastructure projects ensuring road and sea links with those nations. In addition, China is also participating in hydrocarbon projects in Myanmar and Bangladesh. Although Myanmar and Bangladesh are friendly with India and Sri Lanka and the Maldives maintained a love-hate relationship with India, Pakistan has been hysterically belligerent towards India.

Until the massive nerve shattering terror attack bringing down New York’s prestigious twin towers of the World Trade Centre, Pakistan had great diplomatic relationship with the US, which always felt uneasy with India’s excellent ties with, first, the Soviet Union and, thereafter, Russia. The US diplomatic engagement with Pakistan farther soured after the US discovered and killed through a secret operation the WTC attack mastermind, Osama bin-Laden, at a well-fortified Pakistani military cantonment area in Jalalabad, where the fugitive was sheltered for years. Pakistan certainly needed an ‘alternate’ friend. The situation naturally brought Pakistan and China closer.

China needs to encircle India, the world’s second most populous country and among the top seven in geographic territorial control, which is visibly getting closer to a new axis of economic and military power – ‘String of Pearls’ as informally coined by Japanese Prime Minister Shinzo Abe — involving the US, Japan, Australia and India. China is also unhappy about the latest global economic forecast that identifies India as China’s principal economic rival at the top. Lately, Japan’s Softbank group chairman, Masayoshi Son, has gone to the extent of placing India ahead of China within the next 25 years with both the countries overtaking the United States in terms of GDP.

The declining Chinese economic growth trend and its surplus industrial capacity due to drop in exports are seen as an advantage to India in the long run. India’s time-tested liberal democratic system brings addition to foreign investors’ trust to the country. Emergence of South Korea and Communist-ruled Vietnam as new economic powers in the north and eastern parts of China and the growing aggressive attitude of Japan in the South China Sea region seem to have a lot to do with China’s changing geopolitical policies and actions in the region.

India could do little to contain the aggressive diplomatic stance of China, except taking a tough and considered view on trade with China. The easiest thing for India would be to stop China’s dumping of industrial products into India to keep its production going in the face of domestic depression and falling exports to traditional markets in North America and Europe. India is running a huge trade deficit with China in excess of $40 billion. In addition, there is a huge smuggling of China-made products – from tooth brush to sophisticated guns and other armament for the use by terrorist outfits in India – into the country.

India’s fast growing telecom sector is being increasingly flooded with Chinese products, including those security-sensitive ones. If India could offer deficit neutrality to Bangladesh in terms of bilateral trade, there is no reason to allow China to destabilize India’s economy with massive dumping of products. China is the largest exporter to Bangladesh, which runs an annual trade deficit with China to the tune of $7 billion. A $40-billion plus annual trade loss from China to India is probably the best way to respond to China diplomatic belligerence towards India.

Economic and political diplomacy are normally in sync with each other. If China thinks it differently, India should respond as per the tenets of trade. It is time that India takes a firm economic and trade stand with China and formulates a policy that ensures the copy book structure of the two most important aspects of diplomacy. India is emerging as a major destination of global investment – from consumer goods, infrastructure, military hardware to banking, insurance and services. India can ignore China which is insensitive to the country’s public sentiment and security. (IPA Service)