Coping With China-India Rivalry: South Asian Dilemmas 981126371X, 9789811263712

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Coping with China-India Rivalry South Asian Dilemmas

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Coping with China-India Rivalry South Asian Dilemmas editors

C Raja Mohan Hernaikh Singh

World Scientific NEW JERSEY

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LONDON

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SINGAPORE

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BEIJING

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SHANGHAI

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HONG KONG

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TAIPEI

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CHENNAI

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TOKYO

Published by World Scientific Publishing Co. Pte. Ltd. 5 Toh Tuck Link, Singapore 596224 USA office: 27 Warren Street, Suite 401-402, Hackensack, NJ 07601 UK office: 57 Shelton Street, Covent Garden, London WC2H 9HE

Library of Congress Cataloging-in-Publication Data Names: Raja Mohan, C., editor. | Singh, Hernaikh, editor. Title: Coping with China-India rivalry : South Asian dilemmas / editors C Raja Mohan, Hernaikh Singh. Description: New Jersey : World Scientific, [2023] | Includes index. Identifiers: LCCN 2022049657 | ISBN 9789811263712 (hardcover) | ISBN 9789811263729 (ebook) | ISBN 9789811263736 (ebook other) Subjects: LCSH: China--Foreign relations--India. | China--Foreign relations--South Asia | India--Foreign relations--China. | India--Foreign relations--South Asia | South Asia--Foreign relations--India. | South Asia--Foreign relations--China. Classification: LCC DS341 .C666 2023 | DDC 327.51054--dc23/eng/20221019 LC record available at https://lccn.loc.gov/2022049657

British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library.

Copyright © 2023 by World Scientific Publishing Co. Pte. Ltd. All rights reserved. This book, or parts thereof, may not be reproduced in any form or by any means, electronic or mechanical, including photocopying, recording or any information storage and retrieval system now known or to be invented, without written permission from the publisher. For photocopying of material in this volume, please pay a copying fee through the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, USA. In this case permission to photocopy is not required from the publisher.

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Preface

For close to two decades, the Institute of South Asian Studies (ISAS) in the National University of Singapore has been tracking the rapidly growing interactions — economic, political and strategic — between East Asia and the South Asian subcontinent. Of special interest to ISAS has been the impact of a rising China on the South Asia’s international relations. Although China has been an important external actor in South Asia since the middle of the last century, it is only in the 21st century that China became a decisive influence on the region’s evolution. The emergence of China as the world’s second largest economy has naturally made it the largest trading partner for most of the South Asian countries. China’s rapid military modernisation, facilitated by its expansive economic growth, has a major impact on the region’s security politics. China’s political and diplomatic weight is now visible sharply not only in the economic, foreign and security policies of the South Asian nations but also in their domestic politics. Meanwhile, India has emerged, albeit at a slower pace than China, as a major power over the last two decades. Like Beijing, New Delhi’s geopolitical aspirations too have steadily risen during that period. This has set the stage for growing strategic friction between India and China. The friction has enveloped many regional and global domains, but its greatest expression has been in the shared South Asian neighbourhood. India is determined to sustain its traditional primacy in the region and China is set on consolidating its growing influence in South Asia. The sharpening friction has also begun to intersect with the growing great power tensions, especially between the United States and China. Many elements of these v

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new dynamics have drawn academic engagement, in particular from the major power perspectives. However, the voices of the smaller South Asian nations have not been sufficiently heard or analysed. This volume seeks to address that major gap in the current discourse on the Indian subcontinent and its changing role in great power politics. This volume brings multiple regional voices to assess how the various South Asian nations are dealing with the growing rivalry between India and China. Many of the chapters in this volume were initially published as shorter essays by ISAS in its South Asia Discussion Papers series in 2020. Those essays have been updated and expanded in this volume. Additional contributions have also been commissioned to enrich the special perspectives that this volume presents. We thank Associate Professor Iqbal Singh Sevea, ISAS’ Director, for his support for the project. We also express our gratitude to the chapter contributors to this volume. Several of our colleagues at the ISAS also provided their assistance to the project. We are thankful to Ms Wini Fred Gurung, Ms Harpreet Kaur, Ms Claudia Chia and Ms Shavinyaa Vijaykumarr in this respect. Finally, we owe special thanks to World Scientific Publishing for bringing out this publication. C. Raja Mohan Hernaikh Singh November 2022

© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_fmatter

Contents

Prefacev Chapter 1

Introduction C. Raja Mohan and Hernaikh Singh

Chapter 2

India and China in Afghanistan: A Renewed Theatre of Contestation Shanthie Mariet D’Souza

7

Chapter 3

Bangladesh’s Balancing of China and India: Navigating Between Scylla and Charybdis Iftekhar Ahmed Chowdhury

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Chapter 4

The Egg between the Two Rocks: How Bhutan Has Engaged India and China in Very Different Ways Suhasini Haidar

29

Chapter 5

Drivers of the Maldives’ Foreign Policy on India and China Athaulla A. Rasheed

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Chapter 6

India–China Rivalry in Nepal Pramod Jaiswal

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Chapter 7

China and Pakistan: From Tactical Alliance to Strategic and Economic Interdependence Touqir Hussain

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Chapter 8

Competing for Influence: China and India in Post-COVID-19 Sri Lanka Chulanee Attanayake

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Chapter 9

China: Exploring Certainties in Uncertain Sino-Indian Relations Zheng Haiqi

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Chapter 10 India Meets China in Its Periphery S. D. Muni

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About the Authors121 Index125

© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_0001

Chapter 1

Introduction C. Raja Mohan and Hernaikh Singh

Scholars of Sino-Indian relations have long argued that Beijing and New Delhi are locked in a permanent structural rivalry.1 Yet, there has been consistent ambition in both New Delhi and Beijing that they should work together to build a new Asia. This aspiration dates to the early 20th century when Indian and Chinese nationalists gathered at the 1927 anti-imperialist Congress in Brussels and vowed to jointly build the post-colonial order in Asia.2 However, the new forces rising out of China and India struggled to build a steady and cooperative relationship as the Second World War put them on the opposite sides of the Asian divide. While the Indian nationalists focused on throwing the British out of India, the Chinese nationalists were engaged in ending the occupation of Japanese imperial forces. The Indian and Chinese eagerness to collaborate and their inability to do so persisted through the 20th century. In fact, the contradictions between independent India and the People’s Republic of China became sharper as they found themselves sharing a frontier after Mao Zedong gained control over Tibet. Their inability to settle the dispute over the new boundary and the divergence over the Tibet question saw the Sino-Indian bonhomie of the 1950s end in military clashes in 1962. The normalisation of bilateral relations in the late 1980s saw relative peace and tranquillity on the long and disputed frontier and a steady expansion of bilateral economic and political relations as well as regional and multilateral cooperation. However, that phase began to break

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down in the early years of the 21st century. A series of military crises on the border — of increasing severity — began to have a strong negative effect on bilateral political, commercial and diplomatic ties. The deterioration of Sino-Indian relations also coincided with the sharpening of tensions between China and the United States (US) and a growing warmth between New Delhi and Washington. If the early decades of the 21st century saw India deepen its strategic cooperation with China and Russia through forums such as the BRICS (Brazil, Russia, India, China and South Africa), New Delhi also became an active member of the Quadrilateral Security Dialogue (also called the Quad) that bound India to the US and its Asian allies. While some see it as a return to non-alignment or a discovery of multialignment, there is no question that New Delhi’s problems with Beijing have moved it closer to the US with the object of balancing China. New Delhi has also watched warily as Russia and China beef up their bilateral partnership against the US. Although India continues to engage China and holds onto Russia, the weight of the US and its allies is growing in India’s geopolitical calculus.3 The role of the US and Russia in shaping the complex dynamic between India and China has drawn widespread attention. However, the importance of the subcontinent in shaping the relations between China and India has not been adequately debated. Even less appreciated are the strategies of the South Asian states in shaping the relations between India and China and responding to changes in the nature of the relationship between New Delhi and Beijing.4 China, which shares land borders with Afghanistan, Pakistan, Nepal and Bhutan in the north, has developed strong ties with Bangladesh and has been increasingly active in the waters of the subcontinent, stepping up its maritime and naval engagement with Sri Lanka and the Maldives. More broadly, the rise of China as a great power has rapidly enhanced its strategic profile in the subcontinent. South Asia, on its frontiers, has been no exception. However, the shared neighbourhood has made China’s weight in the region far more consequential. As China became the world’s second largest economy, with an aggregate gross domestic product of about US$17 trillion (S$23.7 trillion) in 2021,5 its economic impact in all regions of the world has dramatically risen. It is no surprise then that China has become a major commercial partner for the South Asian nations, including India. As part of its engagement with the subcontinent in the 20th century, China sought to connect its frontier regions with roadways across the Karakoram

Introduction   3

mountains and Tibet. In the 21st century, connectivity has become a major theme of China’s international engagement, defined by the Belt and Road Initiative (BRI). Three broad corridors — at different stages of development — now radiate south across the Himalayas into Pakistan, Nepal and Myanmar. Complementing them is a Maritime Silk Road that links China’s eastern seaboard with the subcontinent’s ports. All the South Asian countries, except India, have welcomed the BRI.6 China, which has long had a security partnership with Pakistan, has become a major supplier of arms to many countries in the region, causing some anxiety in New Delhi.7 Unlike in the 20th century, when China mostly stayed away from the domestic politics of the South Asian states, it is increasingly seen as an important factor in shaping internal political developments in many South Asian nations.8 China’s economic transformation and the consequent expansion of its comprehensive national power are having strategic consequences everywhere, including in South Asia. Historically speaking, the subcontinent is widely viewed as a single civilisational space. Empires rose and fell across time with different degrees of sway over the region. However, the geopolitical unity of the subcontinent seemed to endure. If the British colonial rule constructed the most expansive political entity in the history of the subcontinent, it also ended in breaking it up into two. The great Partition in 1947 and its aftermath continue to hobble the subcontinent. Although the two events are not related, the Partition of India was followed by the unification of China under communist rule in 1949. The creation of a coherent and eventually powerful political structure to the north would have lasting strategic effects, not in the least the slow but certain evolution of an ‘all-weather’ partnership between China and Pakistan. China’s steady rise unsurprisingly opened significant balancing opportunities for India’s other neighbours. New Delhi had indeed inherited the mantle of the British Raj as the protector of the weaker states in the region but had trouble sustaining it. As the smaller states developed stronger identities of their own, it was inevitable there would be a tension between India’s presumed political primacy and the nationalist sentiments in the neighbourhood. China’s economic transformation and the consequent expansion of its comprehensive national power are having strategic consequences everywhere, including in South Asia. This, in turn, opened ever more possibilities for deepening Chinese imprint in South Asia. On the face of it, the logic of South Asia’s economic geography would seem to favour

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India and compensate for the political divisions between India and its smaller neighbours. However, India’s inward economic turn after independence meant the steady dissipation of natural economic links in the region. To make matters more complicated, most of India’s neighbours too turned socialist and created the conditions that made the subcontinent the ‘least integrated region’ in the world. However, as India and the rest of the region turned towards economic liberalisation and globalisation, the prospects of regional integration brightened. Even as India sought to push South Asian economic cooperation and connectivity, a host of factors severely limited the scale and scope of regional integration under India’s leadership. These included deep elite mistrust of India among the neighbours, the politicisation of commercial projects and the mobilisation of anti-Indian resentments by sections of the political class. Meanwhile, China’s emergence as a powerful economic force with much larger resources than India created an attractive commercial magnet for India’s South Asian neighbours.9 China’s lead in regional connectivity shook India into more decisive responses, especially under the government of Prime Minister Narendra Modi. India formally rejected the BRI, mounted an active campaign against it and mobilised its new strategic partners like Japan and the US to counter China’s regional connectivity initiatives.10 More broadly, the sharpening Sino-US tensions saw the emergence of the Indo-Pacific framework as a strategic counter to China’s economic and military influence.11 These, in turn, have increased the agency and leverage of the smaller South Asian states. Not all countries responded in an identical fashion to the shifting dynamic between India and China over the last seven decades or more. Each of them has a unique story to tell, given their unique locations and separate histories of engaging with India and China. In Afghanistan, China is a relatively new strategic actor. Beijing’s conflict with New Delhi comes from China’s potential ambition to draw Afghanistan into a trilateral regional partnership with Pakistan. China’s strategic ties with Pakistan are deep and entrenched. With Pakistan viewing China as a dependable partner in countering India and New Delhi drawing close to Washington, the stakes of Beijing and Islamabad in their partnership continue to rise. Bangladesh, whose struggle for independence in 1971 saw New Delhi and Beijing ranged on opposite sides, today has well-balanced relations with India and China. Dhaka is consummate in navigating Sino-Indian rivalry for its national benefit.

Introduction   5

Nestling between India and China in the Great Himalayas, Nepal and Bhutan have been at the very centre of the rivalry between India and China ever since the latter came to control Tibet. Recent years have seen an accentuation of the importance of Nepal and Bhutan. Kathmandu and Thimphu, however, have adopted vastly different approaches to dealing with Sino-Indian rivalry. If Nepal’s volatile domestic politics have introduced greater dynamism to its engagement with New Delhi and Beijing, Bhutan’s ties with India and China have evolved more steadily. As a result of China’s emergence as a great maritime power with the ambition to put an anchor down in the Indian Ocean, Sri Lanka and the Maldives have risen rapidly in Beijing’s priorities. This, in turn, has seen India push back vigorously in the two island republics. Colombo and Malé have had a turbulent engagement with India and China. The chapters in this volume bring together perspectives on how the region has manoeuvred between the historically dominant power of the region, India, and a rising power, China. Seven of the following chapters capture the views of Afghanistan (Shanthie Mariet D’Souza), Bangladesh (Iftekhar Ahmed Chowdhury), Bhutan (Suhasini Haidar), the Maldives (Athaulla A. Rasheed), Nepal (Pramod Jaiswal), Pakistan (Touqir Hussain) and Sri Lanka (Chulanee Attanayake). These are followed by two chapters that discuss the changing approaches of China (Zheng Haiqi) and India (S. D. Muni) to the region. Together, these chapters provide important insights into the South Asian responses to the deepening SinoIndian rivalry and the broader consequences for the subcontinent’s international relations.

Endnotes   1 See John Garver, Protracted Contest: Sino-Indian Rivalry in the Twentieth Century (Delhi: Oxford University Press, 2000).   2 Michele Louro, Comrades Against Imperialism: Nehru, India and Interwar Internationalism (Cambridge: Cambridge University Press, 2018).   3 “India seeking courtship with Quad is a negative asset of BRICS, SCO”, Global Times, 12 March 2021; and C. Raja Mohan, “Delhi’s great power diplomacy: The Great Indian Rope Trick”? The Straits Times, 28 May 2022.   4 One early exception has been S. D. Muni and Tan Tai Yong (eds.), Resurgent China: South Asian Perspectives (Delhi: Routledge, 2012).  5 Susanna Gevorgyan, “Economic leaders vs fastest growing economies in 2021”, ­developmentaid, 26 January 2022, https://www.developmentaid.org/

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news-stream/post/136675/economic-leaders-vs-fastest-growing-economiesin-2021.  6 Muhammad Faisal, China’s Belt and Road Initiative in South Asia: An Assessment and Outlook (Ottawa: Macdonald Laurier Institute, June 2021).   7 Anil Chopra, “China’s growing defence exports — Implications and options for India”, Chanakya Forum, 7 March 2022.   8 US Institute of Peace, China’s Influence in the Conflict Dynamics of South Asia (Washington DC, December 2020).   9 D. Suba Chandran and Bhavna Singh (eds.), India, China, and Subregional Connectivity in South Asia (Delhi: Sage, 2015). 10 See Constantino Xavier, Sambandh as Strategy: India’s New Approach to Regional Connectivity (Delhi: Brookings India, 2020). 11 Hemant Adlakha, “BRI and the Indo-Pacific Strategy: Geopolitical vs. Geostrategic”, Modern Diplomacy, 21 April 2022.

© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_0002

Chapter 2

India and China in Afghanistan: A Renewed Theatre of Contestation Shanthie Mariet D’Souza

Summary Afghanistan presents curious case of cooperation and competition for the two Asian giants — India and China. In the aftermath of the standoff at Doklam in 2017, when India and China were looking at opportunities to reset their bilateral relations and mitigate trust deficit, a narrow window of cooperation appeared to have opened with the announcement of the extension of bilateral cooperation to war-torn Afghanistan. Following the informal meeting between India’s Prime Minister Narendra Modi and China’s President Xi Jinping in Wuhan in April 2018, a proposal for joint economic projects in Afghanistan was made by the foreign ministries of both countries. However, the statement did not provide further details on the projects to be unveiled. This generated significant curiosity among long-term Afghan watchers in India, not so much because the conflict situation in the war-torn country would forestall the execution of any such project but due to the structural limitations posed by the starkly divergent ‘end game’ both countries envisage in Afghanistan. It remained a considerable challenge to coalesce India’s economic, security and political interests in Afghanistan with the predominantly security and strategic concerns of China. Apart from

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few joint training programmes for Afghan diplomats and police officers, both countries pursued their Afghan policies independently without much cooperation. The precipitous withdrawal of the United States (US) forces from Afghanistan in August 2021 and the establishment of the Taliban Islamic Emirate have further precluded any scope for cooperation. On the contrary, in view of their sharply contrasting strategic objectives and world views, Afghanistan could emerge as an arena of increased competition between China and India.

The ‘New’ Afghanistan In August 2021, the Taliban seized power in Kabul. In a rather swift turn of events, even as the US and North Atlantic Treaty Organization forces scrambled to pull their last soldier out of Afghanistan, President Ashraf Ghani fled the country, leading to a governmental collapse and allowing the Taliban to capture the seat of power without much bloodletting. Vice President Amrullah Saleh retreated to Panjshir valley, along with hundreds of special forces belonging to the Afghan National Defence and Security Forces (ANDSF), to organise an anti-Taliban resistance. However, without external assistance, that resistance collapsed in a matter of weeks, allowing the Taliban to claim control over the entire country and announced the establishment of the Islamic Emirate.1 Such claim, however, has been disputed and challenged by other terrorist formations like the Islamic State’s Khorasan Province, the Islamic Emirate’s own internal divisions and a nascent National Resistance Front of Afghanistan (NRFA),2 led by Ahmad Massoud, an Afghan politician. Notwithstanding its inability to govern and, more importantly, the obdurate reluctance to dilute its regressive worldview on women and minorities, the effective establishment of the Taliban government has divided the international community, including India and China, into two separate groups. Countries like China and Pakistan have moved ahead in engaging the Taliban and have maintained their diplomatic presence in Afghanistan. On the other hand, India, which evacuated its diplomatic staff and citizens, and shut its embassy and consulates,3 remains extremely concerned with the unfolding humanitarian crises in Afghanistan and yet is reluctant to do business with the de facto rulers of the country.



India and China in Afghanistan: A Renewed Theatre of Contestation    9

Non-convergence on Interests Peace and stability in Afghanistan have been the stated policy objectives of both India and China. Both countries are concerned about instability and conflict spilling over into their territories and impinging upon their security interests. While India foresees an unstable Afghanistan becoming a fountainhead of security challenges for its territory, China is equally apprehensive of the security implications of terrorism in Afghanistan on its restive Xinjiang province. For New Delhi, a peaceful Afghanistan is a potential land bridge connecting India with energy-rich Central Asia and thus an integral part of its ‘Connect Central Asia’ policy. Beijing is also interested in Afghanistan’s natural resources and the energy sector and as a link to West Asia for its bourgeoning energy requirements. Stability and peace are pre-requisites for such security, economic and strategic objectives to be fulfilled. However, these broad range objectives notwithstanding, significant variations exist in the preferred modalities of both countries for such an ‘end game’ to materialise. Three such variations in the strategic sphere stand out distinctly in post-August 2021 Afghanistan. First, prior to the Taliban victory, New Delhi had maintained a clear stand of not engaging the insurgent group and had mostly viewed the peace process by the US with the Taliban, which had excluded the Afghan government, with caution. China, on the other hand, maintained some sort of curious linkages with the Taliban. Reports from the field indicate that Chinese government officials have met the Taliban leadership secretly on several occasions since 2001. In fact, the Chinese were among the first to reach out to the Taliban when the latter captured power in Kabul in 1996. Such contacts ensured some control over the spread of Islamic extremism among the Uighurs and prevented Chinese nationals and economic interests from coming under attack from the insurgents in Afghanistan. It was easy for Beijing to build on these special links once the Taliban recaptured power in August 2021. In July 2021, a nine-member Taliban delegation visited the port city of Tianjin and met China’s Foreign Minister Wang Yi. The latter reportedly extracted a promise from the group to control the Uighur insurgents.4 India, on the other hand, has been targeted by Talibanlinked groups on several occasions. It views the Haqqani network, a Taliban affiliate and a prominent constituent of the Islamic Emirate, as a fiercely anti-India terror group. Barring a couple of occasions during which Indian intelligence officials and diplomats held talks with Taliban

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delegations, New Delhi’s disappointment with the forcible occupation of power by the Taliban has been well articulated in various forums. Second, unlike India, China does not consider Pakistan to be a destabilising factor in Afghanistan. Owing to its strong and friendly ties with Pakistan, Beijing believes that Pakistan can contain the situation to China’s advantage. Pakistan remains a lynchpin for China’s Afghan policy. Third, although both India and China had expanded their footprint under the security umbrella provided by the US-led international forces in Afghanistan to pursue their economic and security objectives, “Beijing instinctively sees American troops in China’s ‘backyard’ as a serious strategic threat”.5 Thus, while the US departure from Afghanistan is a welcome development for Beijing, for New Delhi, it is a sudden disappearance of the much-needed support system that had facilitated the expansion of its activities and influence in the country. China is a part of a Quadrilateral Cooperation Group, which also includes Afghanistan, Pakistan and the US, which worked unsuccessfully to start peace talks between the Afghan government and the Taliban. New Delhi, on the other hand, was opposed to any hurried withdrawal of American forces from Afghanistan, leaving the door open for the Taliban to subvert the democratic regime in Afghanistan. While both New Delhi and Beijing were sceptical of the agreement between the Taliban and the US being a harbinger of peace and stability in Afghanistan, Beijing was equally sceptical of the prospect of intra-Afghan dialogue. New Delhi, on the other hand, backed an Afghan-led and Afghan-owned process as a pre-requisite for peace in the country. China, however, propounded that the power vacuum which would be created by the US withdrawal, as well as the failure of the intra-Afghan dialogue, would have to be filled by a United Nations (UN) peacekeeping force. At the same time, China maintained that the US troops had wreaked havoc in Afghanistan.6

Divergent Approaches Broadly, New Delhi’s approach to the security challenges posed by conflict-ridden Afghanistan can be categorised as multipronged, spanning across the political, governance, economic, connectivity and security arenas. On the other hand, Beijing has pursued a predominantly securitycentric approach that seeks to prevent Afghanistan from turning into a security nightmare for itself. This fundamental difference, in a way, defines



India and China in Afghanistan: A Renewed Theatre of Contestation    11

why incongruity is almost an obvious aspect of their respective engagement with Afghanistan. In the last two decades, one of the enduring factors of India’s Afghan policy had been to extend its support to the civilian government in Kabul and implement its projects through it. In turn, the civilian government’s credibility among the civilian population was enhanced, enabling the government to work as a bulwark against anti-India activities on Afghan soil. With an aid pledge of US$3 billion (S$4.2 billion), India remains the largest regional donor in Afghanistan. During the tenure of the civilian governments headed by Presidents Hamid Karzai and Ashraf Ghani, most of the Indian aid was provided through the Afghan government based on Afghan needs and priorities. New Delhi would like to believe that its activities in sectors such as health, education, economic, agriculture, women empowerment, capacity building and infrastructure development have not only accrued the goodwill of ordinary Afghans but also have been directed at extending the reach of the Afghan government. Hundreds of Afghan students were provided fellowships to study in Indian universities and thousands of Afghans are granted medical visas to access health facilities in India. Prior to the Taliban takeover, around 3,500 Afghan officials were trained in India each year.7 Even after the establishment of the Islamic Emirate, India has sent several consignments of medicine and wheat for the Afghan civilians. Such gestures are results of its continuing concern for the Afghan civilians. New Delhi has also worked to provide a landlocked Afghanistan with an alternate sea route for commerce through Iran’s Chabahar port, which is managed by an Indian company, India Ports Global Limited. In turn, this has partially decreased Afghanistan’s trade and transit dependence on Pakistan. In 2009, India constructed the 218-kilometre Delaram–Zaranj Highway in the Nimruz Province of Afghanistan, connecting the Delaram District in Afghanistan to the border of Iran, linking Herat and Kandahar, as well as with Mazar-e-Sharif, the capital of the northern Balkh province. India’s intention of building a 900-kilometre railway track from Chabahar to the resource-rich Bamiyan province, where an Indian consortium had won the contract to mine the Hajigak iron ore deposits, however, looks uncertain, after August 2021. Despite several attacks targeting its embassy and civilians, which have resulted in fatalities, New Delhi resisted the temptation of putting ‘boots on the ground’ in Afghanistan, thus refraining from being a party to the conflict and endangering the ‘goodwill’ factor. Its indirect role was

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limited to training Afghan security force personnel in India and providing a limited amount of equipment, which, in recent years, included four Mi-24v helicopter gunships.8 India is the first country with which Afghanistan signed a strategic partnership agreement in 2011, much before it signed a similar agreement with the US. For India, it was the first such strategic partnership in the neighbourhood. In comparison, Afghanistan’s security sector witnessed several prominent activities by China, ranging from engaging the Taliban to capacity building of the Afghan security forces. In the past few years, several secret meetings were held between the Chinese authorities and the Taliban representatives, including some in China itself.9 As part of the joint initiatives with Russia, Iran and Pakistan, China’s apparent strategy was clearly to nudge the Taliban in the direction of a negotiated path of conflict resolution and retain its influence with this group. At the same time, Beijing had also sought to build capacity among the Afghan security forces in non-lethal operations, such as crowd and riot control, criminal investigations and internal security duties. Since 2006, several batches of Afghan security forces, including the Afghan police personnel, were provided with such training in China. In March 2016, the Chief of Joint Staff of the People’s Liberation Army pledged around US$70 million (S$97.8 million) in military aid to the Afghan government’s counter-terrorism initiatives. The first lot of Chinese military consignment, including logistics equipment, parts of military vehicles, ammunition and weapons for the ANDSF, was delivered to the Afghan government in July 2016.10 While sensitivities of the Taliban and Pakistan appeared to have influenced the Chinese decision to limit the training and provision of equipment only to the non-lethal category, this somewhat changed from late-2017 onwards, possibly to bring more pressure on the Taliban to agree to a path of negotiation and make the group amenable to Chinese pressure. In December 2017, senior officials of both countries sought to enhance bilateral cooperation on counterterrorism and border control and, in January 2018, the Chinese embassy in Kabul announced additional military aid to help build up the Afghan army’s capacity. Despite the vast economic potential and interests, Afghanistan figured low in Beijing’s economic imagination and involvement.11 China is, by far, the biggest foreign investor in the country, and Kabul has been an official partner of the Belt and Road Initiative (BRI) since May 2016. This is despite that the original version of the BRI excludes Afghanistan while



India and China in Afghanistan: A Renewed Theatre of Contestation    13

traversing through Central Asia and Pakistan. So far, in the last five years, no specifics of the BRI projects in Afghanistan have been outlined by either country. Beijing has not even specified the funding pattern for the projects. The Taliban assumption of power, however, has renewed the possibility of the fruition of an extended BRI into Afghanistan. In early September 2021, Zabiullah Mujahid, the Taliban spokesperson, said that the new Afghan government wants to join the China–Pakistan Economic Corridor, the Pakistan component of the BRI.12 At the same time, it needs mentioning that except for the US$4.4 billion (S$6.15 billion) Aynak copper mine project in Logar that started in 2008 and the Amu Darya basin oil exploration project in 2011, Chinese companies hardly demonstrated any interest in investing in Afghanistan. Even these two projects have failed to make much progress owing to several reasons, including hitting an archaeological site at Mes Aynak. In tune with its long-term geo-economic pursuits, China has connected the city of Nantong with Mazar-e-Sharif through a railway line. Apart from this, Chinese aid and assistance for reconstruction projects in Afghanistan have been modest. Barring relatively small projects, such as the building of houses for civilians, China’s role in infrastructure development in Afghanistan has largely been absent. Chinese aid to Afghanistan stood at a mere US$320 million (S$446 million) between 2002 and 2014. An additional US$240 million (S$334.4 million) was pledged between 2014 and 2017. This, however, has the potential of undergoing a change in the Taliban-controlled Afghanistan. The Islamic Emirate looks up to Beijing to kickstart major economic projects worth billions of dollars in the country.13

Hostage to the State of Bilateral Ties The prospects for greater cooperation have been held hostage to the state of bilateral ties between India and China and the broader geopolitical competition emerging in the Indo-Pacific. Following the Wuhan informal summit between Modi and Xi, India and China organised two joint capacity-building programmes for Afghan diplomats in New Delhi and Beijing (October–November 2018 and November 2019, respectively) and a community policing programme for Afghan police officers in Ghaziabad in February 2020. The two sides agreed to carry out ‘China–India plus’ cooperation in Afghanistan and speed up the economic cooperation under

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the BCIM (Bangladesh, China, India and Myanmar) framework.14 Although hailed as a new chapter in India–China regional cooperation by diplomats of both countries, these training programmes remained, at best, modest, training only 20 diplomats and 10 police officers. Nevertheless, it was a new beginning. Such cooperation and execution of joint projects indeed reflected the state of play in their bilateral relations and the extent to which both countries attempted to deepen their engagement in a variety of sectors. Post-Wuhan, such joint training programmes, albeit small, were among the several mechanisms unveiled to address the trust deficit between India and China by engaging as frequently as possible using multiple forums. This mechanism could have been strengthened and expanded had the momentum to deepen bilateral engagement continued. That, however, did not happen. Post-August 2021, this phase of experimental cooperation ended. The basic differences between India and China on a range of issues, such as Pakistan, terrorism, the boundary problem, trade and India’s aspirations to become a permanent member of the UN Security Council and the Nuclear Suppliers Group, have persisted. New Delhi is unhappy at China’s repeated objections to any political and economic activity in Arunachal Pradesh and its repeated attempts to ferment instability in the northeastern region and Ladakh. Furthermore, China’s repeated efforts to increase its influence in India’s neighbourhood and the Indian Ocean could push India to put its ‘reset China policy’ to rest and seek closer relations with the US. The standoff between the military personnel of both countries at Ladakh, which began in May 2020, continues to mark a severe disruption to the friendly ties both had sought to build in the months following the Wuhan informal summit. Despite the achievement of de-escalation in two points, negotiations between the two countries to achieve a complete resolution to the standoff have not succeeded. Deep distrust in each other’s strategic intentions marks their bilateral relations. Against such a backdrop, relations between the two nations in Afghanistan, in all likelihood, will be marked by a high dose of competition rather than cooperation. An example of this trend was the COVID-19 pandemic, which initiated a mini competition between India and China to assist Afghanistan’s fight against the virus. Between late February and late May 2020, Beijing provided four consignments of medical and food assistance to Kabul, including a batch of medical supplies exclusively meant for the



India and China in Afghanistan: A Renewed Theatre of Contestation    15

ANDSF to fight the pandemic15 and another consignment of rice and cooking oil “to help the needy people celebrate Eid”.16 India too pitched in with a commitment to supply 75,000 tonnes of wheat, of which 15,000 tonnes were despatched in two tranches in April and May 2020, using the Chabahar port. The same port facility was used to supply 500,000 pills of the anti-malarial drug, hydroxychloroquine, to fight the infection. In early April 2020, India’s Ministry of Defence even planned to deploy naval ships and medical teams in six South Asian countries, including Afghanistan. However, in the absence of any specific request from Kabul, the plan had to be shelved.17 Even though the Taliban regime has not been recognised by either India or China, the post-August 2021 period has been marked by competitive aid supply by both countries. In September 2021, China pledged 200 million yuan (US$31 million) worth of aid to Afghanistan, including food supplies and three million coronavirus vaccines.18 In November 2021, a train carrying more than 1,000 tonnes of food, milk tea powder, cotton-padded clothing, cotton shoes and blankets travelled to Mazar-e-Sharif from China’s Xinjiang province.19 Moreover, China has also repeatedly called for the immediate lifting of the freeze on Afghanistan’s assets in the US and various sanctions to “unconditionally return assets that belong to the Afghan people”.20 India remains opposed to the lifting of sanctions on the Taliban and the freeze on such assets. However, it has despatched at least three consignments of medical assistance21 and another three consignments of wheat to Afghanistan between August 2021 and 8 March 2022.

Future Trajectory The establishment of the Taliban’s Islamic Emirate has led to significant geopolitical realignments in Afghanistan. China considers the arrival of the Taliban in the power centre of Kabul as “a critical transition from chaos to order”.22 Due to its ties with Pakistan and past engagement with the Taliban, China has an added advantage in dealing with the new realities. On the other hand, New Delhi has found itself between the devil and the deep blue sea, having been dislodged from a position of influence in that country. Even though the Taliban leadership has made conciliatory statements welcoming India’s role in Afghanistan, it has been extremely difficult for New Delhi to overcome its past hesitation

16  S. M. D’Souza

and initiate a process of engagement with the Islamic Emirate. India’s views have remained in favour of the establishment of an inclusive government and New Delhi’s policies have worked to evolve a consensus around the issue. Quite naturally, forgetting Afghanistan and its investment in the country as a bad dream is hardly an option for India. A complete domination by the Taliban over Afghanistan is not in India’s interest although it has resisted the temptation of openly supporting the NRFA, which seeks to militarily challenge the Taliban. The formation of an inclusive government, in New Delhi’s view, will dilute the Taliban domination to an extent and protect New Delhi’s interests and undisrupted presence in Afghanistan. On the other hand, China’s support for an inclusive government appears to be only tokenism, as its links with the Taliban remain rather strong. In such a situation of completely diverse end-state and divergent security and economic objectives, a regime of cooperation between India and China in Afghanistan is difficult to foresee in the immediate future. Afghanistan could indeed emerge as a new frontier of competition for the two Asian giants with the intensification of the ‘new great game’ as the other regional powers scramble for influence and control of resources in that country.

Endnotes   1 “Hardliners get key posts in new Taliban government”, BBC, 7 September 2021. https://www.bbc.com/news/world-asia-58479750.   2 Shanthie Mariet D’Souza, “In Afghanistan, the NRF can force a power shift”, Hindustan Times, 18 February 2022. https://www.hindustantimes.com/opinion/ in-afghanistan-the-nrf-can-force-a-power-shift-101645193922819.html.   3 Suhasini Haidar, “140 Indians fly home as govt. closes embassy in Kabul for now”, The Hindu, 17 August 2021. https://www.thehindu.com/news/national/ indians-fly-home-as-government-closes-embassy-in-kabul-for-now/ article35950418.ece.   4 “China Foreign Minister Wang Yi hosts Taliban, calls them ‘pivotal force’”, The Hindu, 28 July 2021. https://www.thehindu.com/news/international/ taliban-leader-meets-chinese-fm-assures-not-to-allow-terrorist-forces-tooperate-from-afghanistan/article35582147.ece.   5 Yun Sun, “China’s strategic assessment of Afghanistan”, War on the Rocks, 8 April 2020. https://warontherocks.com/2020/04/chinas-strategicassessment-of-afghanistan/.



India and China in Afghanistan: A Renewed Theatre of Contestation    17

  6 “China–US cooperation in Afghanistan depends on US’ China policy: Global Times ­editorial”, Global Times, 17 August 2021. https://www.globaltimes. cn/page/202108/1231747.shtml.   7 Ministry of External Affairs, Government of India, 15 October 2018. https:// mea.gov.in/Speeches-Statements.htm?dtl/30500.  8 “India hands over second pair of Mi-24V helicopters to Afghan forces”, Economic Times, 15 October 2019. https://economictimes.indiatimes.com/ news/defence/india-hands-over-second-pair-of-mi-24v-helicopters-toafghan-forces/articleshow/71601616.cms.  9  “China courted Afghan Taliban in secret meetings”, Financial Times, 6 August 2018. https://www.ft.comcontent/66b0906a-993d-11e8-97025946bae86e6d. 10 Ayaz Gul, “China delivers first batch of military aid to Afghanistan”, Voice of America, 3 July 2016. https://www.voanews.com/east-asia/china-deliversfirst-batch-military-aid-afghanistan. 11 Yun Sun, “China’s strategic assessment of Afghanistan”, op. cit. 12 “Taliban rolls out red carpet to China’s Belt and Road Initiative”, Nikkei Asia, 12 September 2021. https://asia.nikkei.com/Politics/Internationalrelations/Afghanistan-turmoil/Taliban-rolls-out-red-carpet-to-China-s-Belt-andRoad-Initiative. 13 Ayesha Tanzeem, “Taliban: China is ready to invest billions in Afghanistan”, Voice of America, 14 October 2021. https://www.voanews.com/a/talibanchina-is-ready-to-invest-billions-in-afghanistan-/6270213.html. 14 Embassy of the People’s Republic of China in the Republic of India, 4 May 2018. http://in.chineseembassy.org/eng/dsxxs/dshdjjh/t1556972.htm. 15 “Chinese military supports Afghan counterpart in fighting COVID-19”, Xinhua, 13 May 2020. http://www.xinhuanet.com/english/2020-05/13/ c_139054387.htm. 16 “Afghan experts commend China’s role in COVID-19 fight”, Xinhua, 22 May 2020. http://www.xinhuanet.com/english/2020-05/22/c_139079981. htm. 17 Suhasini Haidar, “No move to deploy Army medical teams to neighbouring countries sans request: Govt”., The Hindu, 24 April 2020. https://www. thehindu.com/news/national/no-move-to-deploy-army-medical-teams-toneighbouring-countries-sans-request-govt/article31424008.ece. 18 “China offers $31m in emergency aid to Afghanistan”, BBC, 9 September 2021. https://www.bbc.com/news/world-asia-china-58496867. 19 Rohit Ranjan, “China: Freight train carrying food, winter supplies departs For Afghanistan”, Republic World, 22 November 2021. https://www. republicworld.com/world-news/china/china-freight-train-carrying-foodwinter-supplies-departs-for-afghanistan.html.

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20 Ayaz Gul, “China renews call for US to ‘Unconditionally’ release Afghanistan assets and lift ‘Unilateral’ Sanctions”, Voice of America, 7 March 2022. https://www.voanews.com/a/china-renews-call-for-us-to-unconditionallyrelease-afghanistan-assets-and-lift-unilateral-sanctions-/6473642.html. 21 “India sends 3 tonnes of essential medicines as aid to Afghanistan”, Indian Express, 29 January 2022. https://indianexpress.com/article/india/indiasupplies-medicines-to-afghanistan-7747418/. 22 Zhang Zhihao, “Wang Yi: Unfreeze Afghanistan’s assets”, China Daily, 7 March 2022. https://www.chinadaily.com.cn/a/202203/07/WS6225e372 a310cdd39bc8afaf.html.

© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_0003

Chapter 3

Bangladesh’s Balancing of China and India: Navigating Between Scylla and Charybdis Iftekhar Ahmed Chowdhury

Summary Almost since its inception, Bangladesh has sought good relations with both India and China to further its own perceived national self-interests. Furthermore, Bangladesh has had to take resource to deft diplomacy to keep both countries engaged in its development and progress. This chapter will seek to demonstrate how it does this. At the same time, it will argue that unpredictable global developments in the post-COVID-19 era and in the aftermath of the war in Ukraine could upset the applecart for all concerned.

Introduction In a broad sense, since its nascence, Bangladesh has had two foreign policy aspirations. The first was its search for security and the preservation of its sovereignty, and the second was its quest for development and economic welfare. The first required the space for the maintenance of sufficient manoeuvrability in policymaking, particularly as it was a weaker neighbour bordering a far larger state, India. As Professor Hedley Bull had 19

20  I. A. Chowdhury

asserted, “the deepest fears of the smaller units in the global system are their larger neighbours”.1 Therefore, Bangladesh, for the sake of a modicum of regional harmony, appeared to have always felt the need to live in ‘concord’ with but ‘distinct’ from that powerful country, India. The ‘concord’ was necessary because of Bangladesh’s geography — the nation was virtually ‘India-locked’, being surrounded by this neighbour except for Myanmar on one side and a coastline on the Bay of Bengal. The need to remain ‘distinct’ was essential because Bangladesh’s own separate identity, as separate from the Indian communities surrounding it, and a sine qua non for its claim to sovereignty, could only be defined in those terms. The second aspiration — the quest for resources for development and economic welfare — meant having to involve itself with a range of other countries. Initially, it was the West, which provided the new-born nation-state with considerable aid to enable it to support itself. Thereafter, offering itself as a large market for the West, Bangladesh managed to utilise foreign assistance effectively and shift its economic thrust from agriculture to manufacturing, starting with ready-made garments. Eventually, as Bangladesh developed further steadily but surely, it began to require massive investments into the energy sector that was essential to fuel this growth and necessary infrastructure to facilitate the progress. One nation, a rapidly rising power at the global level, though not a neighbour but located in close enough proximity, was China. Bangladesh sorely needed such assistance and China was ready to help. However, the problem was China and India viewed each other as more than competitors; indeed, as rivals on the regional and global plane. To curry favour of one risked the danger of raising the ire of the other. It is also true that the reason China was so keen on Bangladesh was precisely the desire to supplant the influence of India, which had a head start as India was the only ally in Bangladesh’s war of liberation from Pakistan in 1971. China, a close friend of Pakistan, then as now, was slow to relate to Bangladesh. However, when the opportunity arose, China did so in a big way. This put Bangladesh in a problematic spot ‘between Scylla and Charybdis’. Handling India and China simultaneously called for unusual diplomatic deftness. However, Bangladesh did not seem to be coy about attempting it. Perhaps, Bangladesh did not have a choice. It is also true that to be able to follow through on such a strategy, it will require



Bangladesh’s Balancing of China and India    21

influence and capabilities that Bangladesh, which being the smallest and the weakest of the three actors, may not readily possess. This situation between the three countries, which is still current, had its origin in the assumption of office of the three leaders of Bangladesh, China and India — Sheikh Hasina in Bangladesh in 2009, Xi Jinping in China in 2013 and Narendra Modi in India in 2014, respectively. Also, all three, within their respective polities, were viewed and generally behaved as extraordinarily strong personalities, with their powers and control well consolidated within their respective political systems. Each, therefore, exercised significant influence in the spheres of both domestic and external policymaking.

Bangladesh–India Relations Bangladesh’s dual heritage of its ‘Muslimness’ and ‘Bengaliness’ contributes significantly to shaping its external behaviour.2 Traditionally, the received wisdom has been the characteristics represented by the nation’s two largest political parties — ‘Muslimness’ by the Bangladesh Nationalist Party (BNP), of an ideology veering slightly right-of-the-centre led by Begum Khaleda Zia; and the ‘Bengaliness’ by the Awami League led by Hasina, politically positioned slightly left-of-the-centre. The former is known to favour China more and the latter, India, though exigencies of necessity have sometimes blurred this. However, throughout the period mainly covered by this chapter, Hasina and her Awami League have been in government. The BNP was in power till 2007, following which a caretaker government ran the country for two years and held elections, which were won by Hasina and the Awami League. Relations with India, fraught till 2007, were eased during the caretaker government, which pleased Indian leaders, who were further contented when the Awami League led the coalition government following the elections. Indeed, Hasina was described by India’s Foreign Minister Pranab Mukherjee of the Congress-led government of Prime Minister Manmohan Singh as a “close family friend”.3 Relations with India got off to a good start. Hasina assured India that Bangladeshi soil would not be allowed to be used by insurgents of Northeast India, to India’s great relief. The ‘Tin Bigha’ dispute, an apple of discord between the two countries for four decades, was resolved in September 2011. Bangladesh showed keenness to remove barriers to transit trade that India wanted so badly. A senior Bangladeshi

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policymaker, Masihur Rahman, even stated that it would not be a “civilised act” to charge transit fees from India.4 The bonhomie continued even when the Bharatiya Janata Party (BJP) with Modi came into office in May 2014. In June 2014, Sushma Swaraj, India’s Foreign Minister, visited Dhaka. On 7 May 2015, in the presence of Bangladeshi diplomats, the Indian parliament unanimously approved the Land Boundary Agreement with Bangladesh, no mean accomplishment, given the complexity of the issue of the ‘enclaves’. The continued, even burgeoning, connections were aided in some measure by the fact that Mukherjee continued in his position as India’s president. However, the titular position was rendered even more so because he was from the Congress and the BJP was in power. However, this difference had no impact on the links with Bangladesh and the BJP was happy to receive Mukherjee’s helping hand in this regard. Then, Modi visited Dhaka in June 2015. The red carpet was rolled out. As many as 22 bilateral agreements were signed, including on maritime safety cooperation. India extended a US$2 billion (S$2.8 billion) line of credit and pledged US$5 billion (S$7 billion) in investments. Hasina was accorded a very warm welcome when she reciprocated with a visit to India in 2017. However, some issues between the two countries remained, and indeed the delay in their resolution was a matter of growing disaffection in Bangladesh. A major issue was that on water-sharing of the 414-mile-long Teesta River that flows through West Bengal, Sikkim and Bangladesh into the Bay of Bengal. Its flood plain covers almost 14 percent of Bangladesh’s crop area and provides livelihood to 73 percent of its people. At the same time, lifelines in the north of the Indian state of West Bengal and a dozen of its districts are dependent on the Teesta River. Though Article 253 of the Indian Constitution allows the central government to negotiate and conclude transboundary agreements, West Bengal’s Chief Minister Mamata Banerjee prevented New Delhi from signing the water-sharing deal.5 This went down badly in Dhaka. Another issue was the killing of Bangladeshi nationals on the Indo-Bangladesh borders. These continued unabated and raised considerable public ire in Bangladesh.6 Meanwhile, Indian legislations, such as the Citizenship Amendment Act and the preparation of the National Register of Citizens, raised concerns in Bangladesh. This was not only because they were seen as discriminatory against Indian Muslims, co-religionists of an



Bangladesh’s Balancing of China and India    23

overwhelming majority of Bangladeshis, but also because of the fear that ‘delisted’ Muslims could be subjects of the policy of ‘push-in’ to Bangladesh. The revocation of Article 370 concerning Jammu and Kashmir also had a felt impact on public sentiments. The Bangladesh government seemed keen to avoid outright conflict with India. Bangladesh’s Foreign Minister A. K. Abdul Momen described the legislations as “India’s internal policy”, in line with New Delhi’s position, but also added in the same breath that because of these, “if [there are] uncertainties in India, it might affect its neighbours”.7 Hasina’s visit to India in October 2019 was expected to address some of those issues but that was not to be. Furthermore, the anticipated signing of the Teesta deal did not happen. There were some unfortunate protocol gaps that several Bangladeshi media even saw as deliberate due to the increasing Chinese links.8 However, Hasina was still anxious to have Modi for the centenary celebrations of the birth of her father, the Father of the Nation of Bangladesh, Bangabandhu Sheikh Mujibur Rahman, in Dhaka in March 2020. By then, communal riots had spread in India. In Bangladesh, there were public demonstrations against Modi’s visit though the government remained keen. Around that time, the COVID-19 virus began to be registered both in Dhaka and New Delhi. The Modi visit did ultimately take place in March 2021. However, it led to large demonstrations in Bangladesh and police actions resulted in casualties. Also, Modi was seen to have used the visit to generate support within a segment of the Hindu community in Bangladesh to advance the interests of his party in the West Bengal state elections. These events led to heightened adverse anti-Indian sentiments in Bangladesh which were reflected in the social media. However, there is a possibility that actions of Hindutva activists in India, perceived negatively by a large segment of Bangladeshis, could become a potential source of strain in Dhaka–New Delhi bilateral relations. Rereferring to reports of communal unrest in India and perceived marginalisation of Muslims, Hasina herself has intervened to signal to the Indian authorities that “such incidents should not take place (in India) that will have impact on Bangladesh”.9

Bangladesh–China Relations China did not endorse the break-up of its close ally Pakistan in 1971 and thus, by implication, the birth of Bangladesh. However, throughout

24  I. A. Chowdhury

the political history of what was then East Pakistan, which became Bangladesh, the progressive left, ‘pro-Peking’ sentiments always had strong roots not only among the intelligentsia but also among the masses. Chinese Premier Zhou Enlai was among the first foreign leaders to visit Dhaka (1956) where he received a tumultuous reception. After 1971, China put out the position that it was not opposed to Bangladesh per se but only to the ‘singing in a duet of Soviet social imperialism and Indian expansionism’ (India and the Soviet Union were the leading champions of Bangladeshi independence). As a young politician, Mujibur Rahman had also been on a delegation to China in the early days. So, as Bangladesh’s leader, he intellectually seemed to understand China’s position. This position eased with the mutual recognition of Pakistan and Bangladesh in February 1974. In June that year, China expressed satisfaction at Bangladesh’s membership of the United Nations (UN), having opposed it earlier. The Bangladesh–China relationship took off in real earnest, and though it never reached the level of Pakistan, it appeared as an attractive model worth emulating, to many Bangladeshis.10 The two significant watershed points in recent times have been Hasina’s visit to Beijing in 2014 and Xi’s visit to Bangladesh in 2016. China, always the primary source of military hardware for Bangladesh, sold two submarines that reportedly raised some eyebrows in New Delhi. However, it satisfied an important aspiration of the Bangladesh navy. During Xi’s visit in 2016, bilateral relations were raised to the level of Strategic Partnership of Cooperation, such nomenclatures being exceedingly important in the Chinese diplomatic lexicon. In Xi’s presence, China signed 22 projects proposed by the Bangladesh side across sectors such as power and energy, internet connectivity and river management infrastructures which included the all-important Padma Bridge.11 Bangladesh thus became utterly enmeshed in Xi’s Belt and Road Initiative (BRI), which incidentally India opposes, but the credit quantum of US$32 billion (S$44.7 billion) was too great to forego. It was useful for Bangladesh that China’s ‘Kunming Initiative’ evolved into the BCIM (Bangladesh, China, India and Myanmar), a sub-regional organisation and one of several supplanting the almost-defunct South Asian Association for Regional Cooperation. In turn, this would enable Bangladesh to involve India in some of the Chinese-funded projects by putting these components formally under the rubric of BCIM, which India favours, as opposed to the BRI that India shuns.



Bangladesh’s Balancing of China and India    25

Chinese support is satisfying Bangladesh’s enormous infrastructural needs. The Chinese model is usually based on the build, operate and transfer principle. After the joint identification of projects, the Chinese side conduct feasibility studies. Thereafter, they construct the project and, ensuring its operability, hand it over to Bangladesh. While this often ensures timely completion and project delivery, it lacks an adequate technology transfer component. However, one major advantage is better management of finances and costs enables indebtedness to be kept in check. Unlike in some other BRI partnership countries, Bangladesh does not yet appear to be confronting any unmanageable debt burden vis-à-vis China.

Concluding Extrapolations While relations with India and China remain important for Bangladesh, so do those with the United States (US), the United Kingdom and the European Union (EU). With Bangladesh’s commendable performance in economic and social indices, achieved in the pre-COVID-19 era, it was poised to graduate from the list of least developed countries. It was negotiating continued market access of its key manufacturers — ready-made garments — into the US and Europe. However, rapid deteriorating relations between the US and China, and, to a lesser extent, between Europe and China, in the wake of the current pandemic, can pose a problem for Bangladesh. Bangladesh will need to keep a watchful eye on whether any kind of sanctions are imposed on China and whether these would have any ramifications for Bangladesh, given its close economic and security links with China. In many ways, navigating between the US and China, should the world confront a new Cold War situation, might become a more significant challenge for Bangladesh than the problem of handling India and China. The West has been a good ally for Bangladesh on the Rohingya issue. The US and the EU have influenced international institutions to be actively engaged with Myanmar and put pressure on the country to comply with acceptable global norms. Both China and India have been less forthcoming. However, China does act helpfully behind the scenes at times, as in defusing a potential maritime conflict between Bangladesh and Myanmar in November 2008. India will be in the UN Security Council (UNSC) for the next two years as a non-permanent member from

26  I. A. Chowdhury

2021. This would likely also be the time when the UNSC must deal with issues arising out of the legal ruling on the Rohingya case in the International Court of justice in The Hague. India’s role in the Rohingya issue can impact future New Delhi–Dhaka relations. However, so far, to India’s satisfaction, the Bangladesh government has stood firm in ensuring that Bangladeshi soil is not used for insurgency operations in India’s troubled northeast. India has also reciprocated by handing over to the Bangladeshi authorities a convicted assassin of Mujibur Rahman, who was hiding in West Bengal. Bangladesh has also not relented to Chinese wishes to award them the construction of a deep seaport near Chittagong, which the Indians perceived as a potential security threat. Instead, the deep seaport was planned to link Payra to the west of Chittagong in the Patuakhali district. In the project, Bangladesh has interestingly managed to attract both Chinese and Indian investments, billing it as both a BRI and BCIM initiative.12 This is an interesting model of getting India and China to work together, the Chinese considering it as a BRI project while the Indians perceiving it as a BCIM project. However, China, with its deep pocket, dominates the investment scene in Bangladesh. Indeed, in quantity, Chinese investments in Bangladesh were reportedly only second to Pakistan. Momen stated that for Bangladesh being caught in a “debt-trap” was not a worry, as the amortisation schedule has been worked out and Bangladesh’s record in this respect has been good.13 Bangladesh has, to date, succeeded in ‘managing’ both India and China by involving India more in matters pertaining to security (as distinct from defence where China remains the major source of procurement) and letting China rule the roost in infrastructure and other investments. It is noteworthy that this has been facilitated by a tacit understanding on the part of both China and India to acquiesce in this dichotomised and shared role in Bangladesh. Credit for this must be shared by all three capitals — Dhaka, Beijing and New Delhi. Of course, it is also noteworthy that Bangladesh’s relationship with India is more complicated as they are neighbours. The unresolved Teesta water sharing issue is a case in point. However, in the more uncertain future that awaits the post-COVID-19 world, there could be unpredictable developments that might shake the harmonious arrangements above. Currently, the US is involved in diverse problems — race protests and civil-military issues, a hard-hitting pandemic



Bangladesh’s Balancing of China and India    27

and a chaotic administration — that would preclude its interests in distant crises. These, combined with deeply weakened multilateral institutions, could significantly reduce global oversight of the hotspots. Ineffective multilateral institutions, as demonstrated in the ongoing Ukraine crisis, could increase the need for weaker states in the international system to lean towards more powerful friends. China, a permanent member of the UNSC, satisfies this requirement for Bangladesh. There will, therefore, be greater propensity for Bangladesh to deepen those bilateral ties with China. This could impact the equilibrium that Dhaka would prefer to maintain in its ties with Beijing, on the one hand, and New Delhi, on the other. During this time, a rising China, already perceived as a peer of the US, is becoming assertive. It is locked in a serious interface with India along the Line of Actual Control separating their forces in Ladakh in the Himalayas. An outbreak of conflict could nullify any cooperation between them, as the analysis above demonstrates, in Bangladesh. Both Bangladesh and India are heading towards general elections — Bangladesh perhaps next year and India in 2024. The results could have an impact on future developments in their bilateral and regional relations. However, one could argue that the basic extrapolations arrived at in this chapter are likely to remain largely valid. India and Bangladesh will always continue to remain critical partners and neighbours of Bangladesh, and Dhaka will need to keep trying to maintain a relationship that will require nimble balancing between the two large neighbours.

Endnotes  1 H. Bull, The Anarchical Society: A Study of Order in Global Politics (London: Macmillan, 1977), p. 310.  2 Iftekhar Ahmed Chowdhury, Bangladesh: Reflections on an Emergent Nation (Singapore: MarketAsia Books, 2015), p. 15.  3 Pranab Mukherjee, The Coalition Years, 1996–2012 (New Delhi: Rupa Publications, 2017), p. 115.  4 Ibid.  5 Iftekhar Ahmed Chowdhury, “Bangladesh and Paschim Bangla: Why this Kolaveri Di?” ISAS Insight No 157, Institute of South Asian Studies, National University of Singapore, 5 March 2012. https://www.isas.nus.edu. sg/papers/157-bangladesh-and-paschim-banga-ocywhy-this-kolaveri-dioco/.

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  6 C. R. Abrar, “Killings at the Bangladesh–India border”, Daily Star, 17 January 2020. https://www.thedailystar.net/opinion/human-rights/news/ killings-the-bangladesh-india-border-1855045.   7 “‘Worrisome’: Bangladesh on citizenship law protests”, Press Trust of India, 22 December 2019. https://www.ndtv.com/india-news/caa-protestscitizenship-law-protests-bangladesh-on-citizenship-law-protests-says-­ worrisome-2152655.   8 M Serajul Islam, “Prime Minister’s Official visit to Delhi”, The New Age, Dhaka, 9 October 2019. https://www.newagebd.net/article/87024/primeministers-official-visit-to-new-delhi.  9 Devadeep Purohit, “India should ensure religion is not used divisively: Hasina”, The Telegraph, 15 October 2021. https://www.telegraphindia.com/ world/india-should-also-ensure-religion-is-not-used-divisively-sheikhhasina/cid/1834642. 10 For these details, see Iftekhar Ahmed Chowdhury, South Asia in the Contemporary World: A Scholar-Diplomat’s Perspective (Dhaka: Cosmos Books, 2019), pp. 30–43. https://www.isas.nus.edu.sg/books/south-asiain-the-contemporary-world-a-scholar-diplomats-perspective/. 11 See Abu Sufian Shamrat and Md Kashem Ali, “China’s strategic partnership with Bangladesh in the 21st century”, South Asia Journal, 2 April 2018. http://southasiajournal.net/chinas-strategic-partnership-with-bangladesh-in21st-century/. 12 “Payra Deep Sea Port (Construction)”, Reconnecting Asia, Centre for Strategic and International Studies. https://reconnectingasia.csis.org/ database/projects/payra-deep-sea-port-construction/29017d80-6361-42de80b8-a279982dc4fc/. 13 Conversation with the author on 11 March 2018.

© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_0004

Chapter 4

The Egg Between the Two Rocks: How Bhutan Has Engaged India and China in Very Different Ways Suhasini Haidar

Summary In the South Asian battleground between India and China, Bhutan has been an outlier. As the rivalry between India and China sharpens, the two Asian giants have carved out three distinct geographical frontiers between them. The first is on the Line of Actual Control, which runs 3,488 kilometres from Ladakh to Arunachal Pradesh on the Indian side, where bloody clashes and a massive troop mobilisation by Indian and Chinese armies marked the summer of 2020, and a standoff continues. The second is the maritime sphere — an area of contestation as India strengthens bonds with the United States (US), Australia and Japan for the ‘Quadrilateral’ in the ‘Indo-Pacific’ — and the Indian navy counters more aggressive forays by the People’s Liberation Army Navy ships and submarines in its own area of influence — the Indian Ocean region (IOR). The third is the South Asian Association for Regional Cooperation region, where both India (with the exception of Pakistan) and China (with the exception of Bhutan) are major players. While China has made inroads of varying degrees in the fields of trade and investment, infrastructure and military cooperation with every other Indian neighbour, it has made very few with Bhutan.1 Despite 29

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several requests from Beijing, Bhutan has refused to reset diplomatic relations with China, which were snapped in 1959; and dealings with Beijing continue to largely pass through its embassy in New Delhi. Bhutan is also the only country in India’s neighbourhood that has yet to be a member of China’s Belt and Road Initiative. While modern day Bhutan has not striven for balance between its northern and southern neighbours, it has clearly chosen India as it seeks an equitable peace for itself. If Nepali leaders have described their predicament as that of a “yam between two boulders”, Bhutanese commentators have called Bhutan’s as an “egg between two rocks”,2 with an acute sense of the fragility of the kingdom’s situation.

Historical Ties with the North and South Historically, Bhutan or Druk-yul (Land of the Thunder Dragon), which is often referred to as the last Shangri-La, was religiously connected to Tibet from the times of Tibetan King Songtsen Gampo’s reign (605–620 CE). Bhutan’s oldest Buddhist temples — the Kyichu Lhakhang in Paro and Jampa Lhakhang in Bumthang — were part of a series of 12 temples built by Gampo that include Lhasa’s Jo-Khang temple. In 1616, the Tibetan monk, Zhabdrung Ngawang Namgyel, travelled to Bhutan and unified it. He is revered as Bhutan’s founder.3 Three and a half centuries later, post the Chinese annexation of Tibet, the flight of the Dalai Lama to India and Chinese claims on Bhutanese territories, Bhutan withdrew its representative to Lhasa while snapping ties with Tibet and China. Since then, it is Bhutan’s relationship with India that has been its primary link with the world. The India–Bhutan relationship has weathered several storms along the way and stands out in contrast to many other such bilateral relationships between two neighbouring countries of such disparate size. For Bhutan, which has open borders with India, free movement of people and currency exchange, the relationship with India is unparalleled. For India, the relationship also stands out in contrast to its bilateral relationship with all its other neighbours, which have seen varying degrees of friction and even hostility over the decades. However, what has driven the India–Bhutan relationship and made it quite as unique, not just in regional but also in global terms? The answers to this question are important not just for China, which seeks a foot in the



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door to this remote Himalayan kingdom, but also for India that might seek to replicate this model with its other neighbours.

Bhutan and Independent India Despite the disparity in their sizes, India has always adapted its expectations to Bhutan’s decisions, even when its own instincts have favoured a different outcome. Some of those terms were set during the first meeting between the Indian and Bhutanese leadership some months after India gained its independence. In fact, the first discussions between the Bhutanese delegation, led by Bhutan’s Second King Jigme Wangchuck’s highest ranking official (subsequently the King’s father-in-law), Gongzim Sonam Topgay Dorji (also called Raja Dorji) and Prime Minister Jawaharlal Nehru in Delhi in April 1948, did not go very well.4 The meetings, as recorded by Gongzim’s daughter, Ashi Tashi Dorji, were tense, especially after Nehru offered the delegation two alternatives, both unacceptable to Bhutan — to join the Indian Union as an autonomous state or to have an alliance in which Bhutan would ‘hand over’ its defence, external relations and communications (this condition was eventually dropped from the agreement) to India. At one point, Nehru referred to both the “liability” of having to shoulder these responsibilities for Bhutan and to pay an annual fee (₹50,000 [equivalent to S$925 at today’s rate]) for area in the Dooars taken by the British. “Relieve yourself of the liability” was the Bhutanese delegation’s reply. After what appeared to be a very awkward moment, Nehru burst out laughing and the moment passed. However, while Nehru’s first instinct to treat Bhutan as he had treated the Indian Royal States or a protectorate like Sikkim hit the wrong note, he made up for it afterwards. The India–Bhutan Treaty of Perpetual Friendship, signed a year later on 8 August 1949,5 included articles on defence and Bhutan agreed “to be guided by the advice of the Government of India in regard to its external relations”. India also returned 32 square miles of Dewangiri territory taken by the British and revised the annual fee to ₹500,000 (equivalent to S$9,251 at today’s rate). By 1958, Nehru had shed his initial crustiness over Bhutan’s autonomy. He took a perilous and historic journey, some of it by yak and on foot across the Chumbi valley and the Doklam area to visit the Himalayan kingdom. After meeting with the Third King, Jigme Dorji

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Wangchuck, and his Queen, Ashi Kesang Choeden Wangchuck, at their palace in Paro, Nehru addressed a rousing joint public rally with Bhutan’s Prime Minister Jigme Dorji. He said, Some may think that since India is a great and powerful country and Bhutan a small one, the former might wish to exercise power and ­pressure on Bhutan. It is essential that I make clear that our wish is that you should remain an independent country, choosing your own way of life and taking the path of progress according to your will. At the same time, we two should live with mutual goodwill as members of the same Himalayan family. The freedom of both Bhutan and India should be safeguarded so that none from outside could do harm to us.6

Since then and right until now, modern India and modern Bhutan have strengthened their unique relationship with three distinct anchors. The first is the bond shared by their leadership, regardless of who actually rules in New Delhi and Thimphu. The second is India’s assistance in Bhutan’s development: harnessing Bhutan’s richest renewable resource of hydropower, the maintenance of roads in Bhutan by India’s Border Roads Organisations (BRO) and education for its citizens. The third is Bhutan’s decision to adopt the Indian style of democracy, and with India’s help, to further it (Bhutan’s fourth King once said that Chinese communism was “incompatible” with the Buddhism that is the core of Bhutan). All three Kings of Bhutan have also been chief guests at the Republic Day parade in India and Indian prime ministers have, with very few exceptions, traditionally made Bhutan the first country of their visit after being sworn in. Prime Minister Narendra Modi, who has visited Bhutan twice in two terms, and each of the Bhutanese prime ministers since Bhutan’s first election in 2008 have kept this tradition going. Perhaps the greatest example of “leading from the front” on bilateral ties was in 2003 when the fourth King actually led his troops into battle to defeat the anti-Indian United Liberation Front of Assam and Bodo rebels who had infiltrated into Bhutan’s south. Ties have also been cemented by infrastructure development in Bhutan. Over the last six decades, the Indian BRO has built 1,600 kilometres of roads, 120 kilometres of tracks, 5,000 metres of bridges, helipads, Paro airport and the country’s telecommunications network along them under its ‘Project Dantak’. When requesting help with the construction of their roads, each of Bhutan’s proposals was both



How Bhutan Has Engaged India and China in Very Different Ways    33

need-based and strategic. “All the new roads [they] proposed to construct were being aligned to run southwards towards India from the main centres of Bhutan. Not a single road was planned to be constructed to the Tibetan (Chinese) border”, recounted one of independent India’s pioneers in forging ties with Bhutan, Nari Rustomji, a bureaucrat who also served as the Dewan, or Prime Minister, of Sikkim from 1954 to 1959, in his book, Dragon Kingdom in Crisis. When the Chinese presented a fork in the road, Rustomji said, “with feelers to bring Bhutan within the orbit of their influence”, Bhutan stood firm in “maintaining an independent stand”.7 Meanwhile, the India–Bhutan collaboration on hydropower, called the “centerpiece”8 of bilateral relations by former Bhutanese prime minister, Tshering Tobgay, has been a cause for both bonhomie and discord between the two countries. India’s assistance in constructing and funding Bhutan’s biggest hydropower projects and buying the electricity from it has more recently clashed with environmental concerns over the dams built and increasing worries of mounting debts from the projects in Bhutan due to delays.

Guarding Bhutan’s Seclusion and Sovereignty The most significant article in the agreement of “perpetual peace and friendship” of 1949 was Article 2, which declared that India would not interfere in Bhutan’s internal affairs and Bhutan would allow itself to be “guided” by India on external affairs (this was amended in 2007).9 Article 6 contained Bhutan’s assurance that there would be “no export of arms, ammunition, etc., across the frontier of Bhutan either by the Government of Bhutan or by private individual”. This article had a strange use for Bhutan some years later at the end of the India–China war in 1963. India asked Bhutan if its troops returning from the front in the North East Frontier Agency (Arunachal Pradesh) could take a faster route through Bhutan’s eastern border, something the King hesitated to do as it could have given the impression that Bhutan was offering India military support in the war. Eventually, a compromise was reached where the soldiers were given passage but were asked to deposit their rifles and weaponry at the Trashigang Dzong armoury before travelling west through Bhutan to India, unarmed. The weaponry lies there till today. “The running anxiety during the 1960s for Bhutan was to steer its external relations with China by giving neither provocation nor the

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impression of getting into a bear hug of dependence with India. Both could jeopardise [Bhutan’s] autonomy”, wrote former Foreign Secretary Jagat S. Mehta.10 In his memoirs, former Foreign Secretary, T. N. Kaul,11 who managed relations with Bhutan at the time, also details how King Jigme’s decision not to start diplomatic missions in more than a few places is a matter of economy and of ensuring a tight control on Bhutan’s imprint on the world. As a result, major countries accredited themselves as Ambassadors to Bhutan through their embassies in New Delhi but were not ‘encouraged’ to visit very often. That practice continues to date and ambassadors of powerful permanent members of the United Nations (UN) Security Council (UNSC), including the US and China, and even major donors to Bhutan like Australia and Germany, have to request invitations to visit Thimphu. At the same time, Bhutan has opened the door to diplomatic autonomy very slowly over the decades, which has sometimes caused misgivings with India. In the 1960s, Bhutan’s desire to join the UN cropped up as one such issue. According to Kaul, there were worries amongst the leadership that India would one day ‘absorb’ Bhutan, something confided to him by the Queen (Royal Grandmother to the Present Fifth King, Jigme Khesar Namgyel Wangchuck) in 1964. These worries were accentuated when Bhutan failed to get membership of the Universal Postal Union on its first attempt in 1961 and the sense was that India had not helped canvass support. “We believe India is the only country that can help us to achieve our natural aspirations. However, any hesitation on India’s part to get us into the United Nations Organisation (UNO) naturally raises suspicions amongst our people. I can assure you that once India gets us into the UNO there will be no suspicions but complete trust between us”, Kaul quoted the Queen as saying. India promised its support. Bhutan set up its own Ministry of Foreign Affairs (MFA) in 1969, was admitted as a member of the UN in 1971 and even joined the Non-Alignment Movement (NAM) in 1973.

Talks with China Bhutan’s diplomatic forays meant that China began to push once again for diplomatic ties and while the Fourth King, Jigme Singye Wangchuck (the present King’s father), rebuffed that idea, he became increasingly open to boundary talks with China despite India’s clear resistance to it. In 1979,



How Bhutan Has Engaged India and China in Very Different Ways    35

ties between India and Bhutan received a jolt at the NAM summit in Havana. Bhutan decided to vote in favour of admitting the Pol Pot-led Cambodian Khmer Rouge regime into the NAM, something India had opposed while China supported it. During a visit to Mumbai in September 1979, the Bhutanese King sought to dispel the idea that Bhutan wanted closer ties with China but insisted that the boundary talks were required. “Recent intrusions by Tibetan graziers deep into Bhutanese territory have underlined the need for direct talks between Thimphu and Beijing with the explicit purpose of demarcating and delineating the boundary between the two countries”, King Wangchuck said, and “no definite decision” had been taken by the Bhutanese National Assembly’s (BNA) assent for the talks.12 Just a month later, however, the BNA did give its assent, according to official records, after the Chief of Survey said that India had promised cooperation in providing documentary evidence for Bhutan’s claim. “The National Assembly unanimously resolved that the Royal Government must demarcate the northern boundary of Bhutan as soon as possible. The MFA and the Office of the Chief of Survey must make all necessary preparations to hold negotiations with the Chinese government in this regard”, said the Assembly’s resolution.13 Then, in 1981, Bhutan’s Foreign Minister, Lyonpo Dawa Tsering, formally informed New Delhi that his country was going ahead with the talks and after one preparatory round in 1983 between Lyonpo Dawa and Chinese Foreign Minister Wu Xueqian in New York, the first round of talks on the boundary issue was held in Beijing in April 1984. The talks between Bhutan and China, held over 24 rounds since 1984 but suspended after the Doklam standoff in 2017, have always centred around three disputed areas: Jakarlung-Pasamlung (a combined area of around 495 square kilometres) in northern Bhutan; and Doklam, along with pasturelands nearby Sinchulung, Dramana and Shakhatoe (269 square kilometres) at the western trijunction with India and China. Much to India’s chagrin, China pushed for a swap in a proposal made public by the Fourth King after the 11th round of talks in 1996,14 offering Bhutan the northern areas in exchange for the more strategically important western one at Doklam, an offer it repeated over the years. At India’s request, Bhutan has held off making the deal but the pressure from China to resolve the boundary situation continues. Sometime in the past two decades, the People’s Liberation Army (PLA) of China began to build the dirt track at Doklam that became the centre of the three-month-long

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standoff between Indian and Chinese troops in June 2017. Despite a détente between New Delhi and Beijing, the PLA continued to build up its military installations, roads and trenches around the Doklam plateau, indicating it is consolidating its positions in the area with the hope it will negotiate successfully for the last part of the land with Bhutan, on its terms and as per its earlier proposal.

Stick and Carrot Policy One reason for Bhutan’s wariness of China is the ‘stick and carrot’ policy of the government in Beijing: making territorial claims and then demanding talks on them as a way of pushing for full diplomatic relations. This is also the reason Bhutan most wants a demarcated and settled boundary with China. After Tibet’s takeover, in 1959, for example, the PLA occupied eight Bhutanese enclaves, with Chinese Premier Chou En-Lai making the demand for bilateral talks to discuss their return. Later, in 1979, the Fourth King’s push for talks came after a border incursion by the PLA. In 1996, after Bhutan raised Chinese “logging and road construction activities” in the disputed territories during the 11th round of talks, China proposed an interim agreement for the maintenance of peace and tranquillity along the borders, the only such formal bilateral document between them (signed in 1998).15 It could be argued that the Doklam crisis was triggered by a similar push for bilateral talks and it was followed by the highest-ranking visit by Chinese Vice Minister of Foreign Affairs, Kong Xuanyou, to Bhutan in 2018. A recent move by China at the UN Development Programme-led Global Environment Facility meeting in June 202016 to claim the Sakteng Wildlife Sanctuary in Bhutan’s eastern territory is disputed — it may well be another attempt to ensure Bhutan’s acquiescence to more boundary talks with China and to the proposed swap. Disturbing signs for New Delhi that China may have made some headway in that plan appeared in October 2021, when Bhutan’s MFA announced it has signed a memorandum of understanding (MoU) on a three-step roadmap to bring the boundary negotiations to a “successful conclusion that is acceptable to both sides”.17 However, no details of the MoU have been released thus far.



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Mother–Daughter Relationship? Through all these moves, New Delhi has remained extremely interested, taken note of the talks and expressed its concerns behind closed doors.18 India has largely maintained public silence as it does not wish to disturb its ties with Bhutan. There have, however, been some exceptions. During the first-elected Prime Minister Jigmi Y. Thinley’s tenure (2008–2013), Bhutan went into diplomatic overdrive with the world, increasing the number of countries with which it had diplomatic relations from 22 to 53 and reaching out for support for a campaign for a non-permanent seat at the UNSC in 2012, which failed. The shocker for New Delhi, however, was a meeting between Thinley and Chinese Premier Wen Jiaobao in June 2012 on the sidelines of the ‘Rio+20’ Summit in Brazil. A year later, the Manmohan Singh government’s decision to withdraw energy subsidies to Bhutan on the eve of its general elections that summer contributed to Thinley’s shock defeat. When the new government under Prime Minister Tshering Tobgay prepared its first round of boundary talks with Beijing a few months later, New Delhi took no chances. It dispatched both National Security Adviser Shivshankar Menon and Foreign Secretary Sujatha Singh to Thimphu to brief the Bhutanese prime minister. “Bhutan’s relationship to India today is like that of a successful daughter to a possessive mother”, writes Karma Phuntso in his comprehensive work, The History of Bhutan, with a somewhat unseemly analogy that suggests that India controls Bhutan with “purse-strings”. “While China is keen on diplomatic overtures, Bhutan remains cautious, like a shy daughter influenced by her mother to keep away from an unworthy suitor”, he adds.19

China’s Charms Many in Bhutan would cringe at such a thought, given the country’s own independent history. As a new generation in Bhutan spreads its wings worldwide, the question that endures is also whether the kingdom will remain as impervious to its northern neighbour and as close to its southern neighbour. Bhutanese students have been increasingly looking away from Indian colleges to those in Thailand, Singapore and Australia. Hindi movie songs are heard much less in Thimphu clubs today than Korean

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K-pop or Western beats. Whether it is for economic growth opportunities, skilling or funding, Bhutanese entrepreneurs are looking further afield than what India offers. Meanwhile, Chinese goods and tourists are making their presence felt in the kingdom. In an interview about China’s ‘charm offensive’ in 2017, author Bertil Lintner described the acrobat performances and university scholarships that Beijing now sends to Bhutan. “It’s only a matter of time before they put a Panda on a plane and send it to Thimphu”, he added, only half-joking.20 “Today, Bhutan’s relation with China remains frozen like [the] Himalayan ice itself while Bhutan–India relation burns like [the] heat of Indian tropics. But the global shift in the regional and international relations mostly brought about by forces of globalization is changing this status quo”, wrote author Dorji Penjore reflecting on the issue in 2004.21 The status quo has not moved yet in India-Bhutan ties, partly due to some deft manoeuvring by the leadership and diplomats on both sides. When Bhutan dropped out of the New Delhi-driven initiative for a Motor Vehicle Agreement between Bangladesh, Bhutan, India and Nepal in 201722 or when Bhutan approved the first-ever tourist fee for Indian travellers in 2020, the Indian government accepted the decision. When Bhutanese officials protested against low Indian tariffs or the 2015 cross-border trade in electricity regulations that put Bhutanese power at a disadvantage to Indian power, New Delhi accommodated those concerns and revised its policy.23 On other counts, India’s decision to demonetise its currency notes, bringing in the Goods and Services Tax in one stroke and the sudden announcement of the lockdown due to the COVID-19 pandemic has hit Bhutan’s economy badly although the Bhutanese government has chosen not to protest publicly. However, when the Modi government cancelled exports of Indian-made COVID-19 vaccines promised to Bhutan for its second round of vaccinations in June 2021, Thimphu did react: putting out a worldwide appeal for vaccine supplies from other countries. In an unprecedented move, the Tshering government decided to accept vaccines from China and the US, among other countries that offered.24 While the two sides have papered over the cracks since then — Bhutan awarded Modi with its highest civilian honour, the Order of the Druk Gyalpo, in December 2021 and Indian External Affairs Minister, S. Jaishankar, became the first foreign dignitary hosted by Thimphu in April 2022, after the COVID-19 pandemic — New Delhi must consider carefully the



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long-term impact of reneging on promises to Bhutan in this manner — both on bilateral ties and public perception.

The Egg Between Two Rocks Through it all, the promises made between Bhutan and India 70 years ago still hold even as China’s desire for closer relations with Bhutan remains strong. While Bhutan’s leadership has managed to keep the two giants to its north and south from impinging on its sovereignty and preserved its culture, it must also be acknowledged that both India and China have maintained a sense of restraint in their ties with Thimphu in a way they have not in other parts of the region. It would seem that under the fragility lies a determined resilience in the face of change which has protected the “egg between the two rocks” through the ages.

Endnotes   1 Riya Sinha and Niara Sareen, “India’s limited trade connectivity with South Asia”, Brookings India, 26 May 2020. https://www.brookings.edu/research/ indias-limited-trade-connectivity-with-south-asia/.   2 This comment was made by a senior Bhutanese official in an interview with the author.  3 Karma Phuntso, The History of Bhutan (Penguin Random House, 2013), p. 206.   4 Documents contained in Ashi Tashi Dorji, Her Life and Legacy, by Bhutan’s Royal Grandmother Ashi Kesang Choeden, Pema Wangdi and Tshering Tashi, self-published, 2017.  5 “India Bhutan Treaty of Perpetual Peace and Friendship”, Ministry of External Affairs, Government of India, 1949. https://mea.gov.in/bilateraldocuments.htm?dtl/5242/treaty+or+perpetual+p.  6 Foreign Policy of India Text of Documents, 1967–1974 (New Delhi, 1964), p. 8. https://shodhganga.inflibnet.ac.in/bitstream/10603/17331/8/08_ chapter%203.pdf.   7 Nari Rustomji, Bhutan: Dragon Kingdom in Crisis (Oxford University Press, 1958).   8 Suhasini Haidar, “Hydropower centrepiece of ties with India: Bhutan PM”, The Hindu, 14 June 2014. www.thehindu.com/news/international/southasia//article61451631.ece.

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 9 The treaty was updated in 2007. See “India Bhutan Friendship Treaty”, Ministry of External Affairs, Government of India, 2007. https://mea.gov.in/ Images/pdf/india-bhutan-treaty-07.pdf. 10 Jagat Singh Mehta, Negotiating for India: Resolving Problems Through Diplomacy (Manohar Publishers, 2006). 11 Triloki Nath Kaul, Diplomacy in Peace and War: Reflections and Recollections, 2016 (published posthumously after Kaul’s death in 2000) (Gyan Publishers, 2016), p. 93. Originally published by Vikas Publishing House, 1979. 12 Saeed Naqvi, “Bhutan and China: Clues to crisis from 1979”, The Asian Age, 4 August 2017. https://www.asianage.com/opinion/oped/040817/bhutanand-china-clues-to-crisis-from-1979.html. 13 Translated Resolutions Adopted by The 51st Session of the National Assembly Held from 18th–29th November 1979. https://www.nab.gov.bt/ assets/uploads/docs/resolution/2014/51st_Session.pdf. 14 Proceedings and Resolutions of 75th Session of the National Assembly held from 20th June–16th July 1997. https://www.nab.gov.bt/assets/uploads/docs/ resolution/2014/75th_Session.pdf. 15 Medha Bisht, “Bhutan: Internal developments and external engagements”, Manohar Parrikar Institute for Defence Studies and Analyses, January 2010. http://www.idsa.in/sites/default/files/countrybrief_Bhutan.pdf. 16 Suhasini Haidar, “China Doubles down on claims on Eastern Bhutan Boundary”, The Hindu, 5 July 2020. https://www.thehindu.com/news/ international/days-after-demarche-china-doubles-down-on-claims-oneastern-bhutan-boundary/article31993470.ece. 17 Bhutan MFA press release on 14 October 2010, https://www.mfa.gov. bt/?p=11456. 18 Suhasini Haidar, “Bhutan, China sign MoU for 3-step roadmap to expedite boundary talks”, The Hindu, 14 October 2021. https://www.thehindu.com/ news/national/bhutan-china-sign-mou-for-3-step-roadmap-to-expediteboundary-talks/article37011831.ece?homepage=true. 19 Karma Phuntso, op. cit., p. 575. 20 Bertie Lintiner, “China turns on charm offensive for Bhutan”, YaleGlobal Online, 22 September 2016. https://yaleglobal.yale.edu/content/ china-turns-charm-offensive-bhutan. 21 Dorji Penjore, “Security of Bhutan: Walking between the giants”, Journal of Bhutan Studies, 2004. http://himalaya.socanth.cam.ac.uk/collections/ journals/jbs/pdf/JBS_10_09.pdf. 22 Decision of the Joint Sitting on Motor Vehicles Agreement for the Regulation of Passenger, Personnel and Cargo Vehicular Traffic Between BBIN, Proceedings And Resolution of the National Assembly of Bhutan (3 May–



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20 June 2017). https://www.nab.gov.bt/assets/uploads/ocs/resolution/2017/ 9thSessionEng.pdf. 23 “Indian amends regulations on cross-border electricity trade”, Kuensel, 25 December 2018. https://kuenselonline.com/india-amends-regulationson-cross-border-electricity-trade/. 24 Suhasini Haidar, “Hit by India’s vaccine export ban, Bhutan seeks help”, The Hindu, 27 June 2021. https://www.thehindu.com/news/international/hit-byindias-vaccine-export-ban-bhutan-seeks-help/article35006213.ece.

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Chapter 5

Drivers of the Maldives’ Foreign Policy on India and China Athaulla A. Rasheed

Summary Following the 2018 election, Maldivian President Ibrahim Mohamed Solih sought to revitalise his country’s ‘India First’ policy. This heralded an end to the former government’s pro-China stance. The Maldives’ relationship with India is influenced by their physical closeness, a history for friendly ties and regional diplomacy. China does not have such benefits in its relations with the island state. This chapter identifies political ideas as the key drivers of foreign policy purposes. Social constructivists have framed foreign policy in terms of how ideas shared by the leaders can cultivate foreign policy purposes.1 Political ideologies can drive the interests of the leaders to seek regional cooperation that best promotes their national circumstances.2 This chapter further discusses how political ideas of the different Maldivian governments have shaped the country’s changing political and developmental partnerships with India and China since 2013. It also argues that the impacts of the Maldives–India and the Maldives–China engagements are determined by the capacity of the Maldivian government and public to navigate foreign relations without compromising the country’s political independence and territorial integrity.

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Introduction It was not unexpected to see China donating a supply of pandemic prevention materials to the Maldives during the COVID-19 crisis. India, Malé’s other regional neighbours and international development partners have been doing the same.3 China’s continued engagement will also test the Maldives’ recent foreign policy shift towards India. After his election victory in 2018, Solih focussed on revitalising the country’s ‘India First’ policy, a change from the pro-China stance adopted by former president, Yameen Abdul Gayoom. In their joint statement during Solih’s visit to India in December 2018, Indian Prime Minister Narendra Modi and Solih renewed their shared ideas of neighbourly relations and friendship for regional stability.4 The Maldives invariably lies within India’s sphere of influence and its regional foreign policy has been shaped by their “geographical proximity as well as traditional bonds of friendship”.5 However, such regional traditions may not have necessarily shaped the Maldives–China relations. Historically, national interests for political independence and developmental gains had been at the core of the Maldives’ foreign policy discourse, even when it negotiated the 1887 protectorate agreement with the British Governor of Ceylon (now Sri Lanka) to guarantee protection against regional pirates in return for tribute payments to the British. Subsequent terms of independence from the British rule, drawn up in 1965, were shaped by ideas of national sovereignty and self-proclamation. Postindependence institutions further created an authoritarian republic that sought political and economic independence by promoting international tourism and national development based on environmental identity.6 Ideas of economic rent-seeking have shaped the Maldives’ governance of a tourism-based economy since the 1970s. Ideas of climate change have shaped the political leaders’ interpretation of national circumstances since the 1980s to successfully gain international cooperation to address its development challenges. The 2008 democratic change further paved the way for divided political ideas between conventional elites and democratic reformers in subsequent years. Such change in political ideologies has shaped the Maldives’ foreign policy interests between India and China, particularly since 2013 when China launched the Belt and Road Initiative (BRI).



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Regional Traditions and Political Independence The Maldives is a small island state in the South Asian region that maintains friendly relations with its neighbours, including India. India has been its most important strategic ally and development partner since the establishment of diplomatic ties in 1965. India shows its leadership in both political and strategic fronts as far as interests of the South Asian region and the Indo-Pacific are concerned. Traditionally, South Asia has been a strategic region in international relations because its security structures have been shaped by ideas of nuclear deterrence between India and Pakistan. In the region’s security, India leads a political discourse of good governance and democratic institutionalism for regional stability. Moreover, cooperation between the regional neighbours has been shaped by ideas of regional solidarity as promoted in their regional organisation, the South Asian Association for Regional Cooperation (SAARC). The Maldives, like its regional neighbours, has always sought regional alliances within these regional boundaries and promoted an ‘India First’ policy in regional security and development cooperation.7 Despite the ‘India First’ policy in regional politics, the Maldives’ partnership with China has expanded, particularly during Yameen’s term in office. During his visit to China to attend the opening ceremony of the Second Summer Youth Olympics in August 2014, Yameen confirmed his interest in expanding the BRI in the Maldives. This foreign policy decision increased China’s presence in the South Asian region and raised strategic concerns for India. Similarly, domestic concerns of the Maldives slipping into a Chinese debt trap and China accruing a naval presence in the country heightened as the Maldivian parliament enacted a law in 2015 to allow foreigners to own land in the Maldives.8 The parliament repealed this law in 2019 after Yameen lost power. The growth of the Maldives– China engagements raised regional strategic concerns for India as China’s increasing presence could compromise its regional security dynamics. Despite India’s concerns, the Maldives’ investments with China soared to great extents between 2015 and 2018, leading to significant investments and a free trade agreement (FTA) allowing unlimited exchange between the two governments. This growth of the Maldives–China relationship has invariably been indicative of the political ideas of Yameen’s government to embrace the BRI for development benefits.9

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The brother of former president, Maumoon Abdul Gayoom, who had a 30-year political stronghold, Yameen was regarded as a power-oriented leader who also sought political stability through development planning. Ideas of self-determination, political independence and development cooperation for mutual gain informed his government’s foreign policy. During his inauguration speech, Yameen stated that “the Maldives is in a deep economic pit…[and] when you lose, be courageous and in victory, be magnanimous. We will decide our affairs”.10 Ideas of political independence have influenced foreign policy on both regional and international issues, including his decision to exit the Commonwealth in 2016.11 The Maldives rejoined it in 2020. On the issue of sovereign rights to self-determination, Yameen stressed that “we have moved our national strive beyond our boundaries, into the international arena to compete with professionals and experts of international stature” and that “the national debate should be about whether we, as a nation, have what it takes to strive and win the international race”.12 He went as far as to reaffirm the constitutional grounds for the supremacy of the state to promote political independence and opportunities for development gains. Internationally, the Maldives’ Minister of Foreign Affairs, Dunya Maumoon, confirmed, “After fifty years of being a UN [United Nations] member, I say to those sceptics…we are not only willing but also able!…We are not only viable but also valuable! And as Maldivians, we are proud of what we have achieved”.13 In recognising the failures of international system to protect island nations like the Maldives from larger nations’ interference in their internal affairs, Yameen also stated that “empowering its people economically would be a great stride for Maldivian domestic affairs” and that “we are trying to find easier ways for us to have access to aid by bringing in big investments”.14 Such political ideas have shaped the Maldives’ foreign policy and have driven it closer to China through opportunities under the BRI platform.

Drive towards the BRI and Mutual Respect The roots of the Maldives–China relations have predominantly been linked to political and economic ideas behind the BRI. The BRI was built on foreign policy principles, of mutual gain, economic cooperation and diplomacy that do not impose political conditions on the internal affairs of its partnering states.15 While it seeks to achieve economic supremacy for



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China, the BRI has also re-created the international architecture for development cooperation. China believes that the world should be a multipolar system and that states should engage in collaboration through a “new type of state-to-state relations — non-alliance, non-confrontation and not directed against any third party”.16 It has pursued development cooperation for more inclusive and balanced engagements between the states that aim to “complement the development strategies of countries involved by leveraging their comparative strengths”.17 In this policy framework, the expansion of the BRI in South Asia brought opportunities for the Maldives to enhance its ties with China. Even before Yameen’s ascension to power, China was regarded as a close friend. Former president, Mohamed Nasheed, who embraced an ‘India First’ foreign policy culture, had also adopted cordial relations with China and expressed a willingness to support China on issues of mutual concern.18 However, the core principles of China’s foreign policy, including respect for territorial integrity and sovereignty, non-interference in domestic affairs, equality and mutual benefit, non-aggression and peaceful co-existence, were more appealing to the Yameen government. In agreeing with Chinese President Xi Jinping that what China had to offer would expand the Maldives’ development trajectories, Yameen confirmed that the alliance had been built on “excellent bilateral relations and development cooperation, based on mutual trust and understanding”.19 Such shared ideas shaped both countries’ foreign policies on development cooperation and regional security fronts. The expansion of investments in the Maldives also brought China closer to India’s sphere of influence. In 2018, the alleged presence of China’s naval fleet in the territorial waters of the Maldives raised political and security concerns in India which was critical about the Yameen government’s handling of the domestic situation. Intervention from India was sought by the opposition leaders in the Maldives. However, India was more concerned about the Chinese naval fleet, which created a strategic buffer against any such intervention. The irony was that China’s position on this situation aligned with Yameen’s idea on political independence. China provided the assurance that “What is happening inside the Maldives is the internal affairs of the country. The international community shall play a constructive role on the basis of respecting the sovereignty of the Maldives, instead of further complicating the situation”.20 China’s support to the Yameen government built further

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confidence in the relationship between the two countries. However, this has not been able to shape its policy on regional security or on India because the Maldives also has a vested interest in regional solidarity. It would not have promoted any engagement with China that could have prompted any regional conflicts or compromised regional security.

Competing Ideas Concerning India and China Regional alliances are built on political, economic and cultural cooperation. China’s engagement in the Maldives created regional power vacuums, inviting competition between India and China. This type of power competition has existed since early 2012 when Nasheed was overthrown in an alleged coup executed by his political opposition. Since his election in 2008, Nasheed’s pro-democracy government had endorsed the ‘India First’ policy based on building regional alliance and development cooperation. A US$511 million (S$711 million) project to develop the international airport was one of India’s high-end investments, representing close bilateral ties through economic cooperation between the two states.21 In addition, to support the security, health and education sectors, India extended a US$100 million (S$139.1 million) ‘standby credit facility’ to the Maldives in 2011.22 The airport development project also highlighted the emergence of political competition between India and China in the Maldivian territory. With the fall of Nasheed, the incoming government was quick to re-contract this airport development project to China. Such behaviour attracted political discourses, including China’s “land-grabbing” practices23 and so-called “debt trap diplomacy”24 that can harm the Maldivian economy. Similar foreign policy discourses were welcomed from India’s strategic policy circles, which raised concerns about the regional power vacuum created by political uncertainty associated with the Maldives’ foreign policy towards China. However, such interpretations of national circumstances have changed with Solih’s government, which has now delegitimised most policies of the Yameen government. After his defeat, Yameen was convicted on corruption charges, including corruption in foreign investment engagements.25 However, the Supreme Court overturned the sentence and released him in November 2021.26 At the time of writing, new corruption charges have been brought against him. Solih government’s purposes are to consolidate democratic practices in domestic and foreign policies. Rejoining the Commonwealth in



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2020 was part of such policy initiatives. The renewal of the policies for cooperation with India has been at the core of the Solih government’s agenda. Today, India is the Maldives’ closest development and strategic partner. However, despite the focus on the ‘India First’ policy, how Solih government position itself both against China and other development partners will also have implications on the role India will play with respect to the Maldives. The BRI drew a significant political and economic interests towards China. What India can offer today in terms of political stability and development opportunities will determine the shape of present and future Maldives–India relationships. As Malé’s foreign policy started to shift towards India, the ideas of so-called China’s “debt trap” also started to help India to navigate its political and economic diplomacy in the Maldives. For example, the Maldives reportedly owed China between US$1.5 billion (S$2.1 billion) and US$3 billion (S$4.2 billion) in loans.27 Such potentially negative impacts China has had on the Maldives have allowed India and like-minded international actors to enhance their engagements to counter China’s economic expansion in the Maldives. The shift in the policy towards India has allowed India to reciprocate through financial support, including Indian government’s announcement of US$1.4 billion (S$1.9 billion) relief to support the Maldives to overcome existing economic challenges associated with the Chinese debt.28 The Maldives’ behaviour towards China or any other extra-territorial powers will concern India. In recent years, the Maldives has also become valuable to the Indo-Pacific strategy of the Quadrilateral Security Dialogue (also called the Quad) partners, which include India, Japan, the United States (US) and Australia. The Quad aims to protect common values and curb China’s economic expansion in the Indo-Pacific’s maritime territories. India is more confident in dealing with these extra-territorial partners as they understand India’s position in South Asia. For example, India unprecedentedly welcomed the Maldives–US defence cooperation agreement in 2020.29 This complements India’s strategic interests in the Maldives’ territorial space. India’s military and security engagements explain these strategic interests. In 2021, India signed a development cooperation agreement with the Maldives to launch the Greater Malé Connectivity Project, one of the largest infrastructure projects in the Maldives. It is funded by an India grant of US$100 million (S$139.1 million) and a Line of Credit

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of US$400 million (S$542 million).30 Political cooperation has been extended further through bilateral discussions to expand India’s diplomatic presence in the Maldivian territory.31 India’s military and strategic presence has also been expanded recently by placing Indian Navy and Coast Guard in Addu and other parts reportedly to “maintain and operate a Dornier twin-engine aircraft and two helicopters” under the Maldives National Defence Force.32 The Maldives–India strategic developments also reflect similar behaviour from Australia in its ‘step-up’ approach towards its Pacific neighbours. The recent growth of Chinese investments in the Pacific Islands has enhanced Australia’s strategic interests in its neighbours.33 Such behaviour of larger states in regional constellations is not uncommon in the history of international relations. Traditionally, smaller states in regional constellations have acted within the benevolence of their larger neighbours for security and development reasons. However, both in the South Asian and Pacific Island regions, the small island states have navigated their regional alliances, including China, and this has primarily been driven by their national interests, that is, domestic political ideas that their national circumstances are better addressed through Chinese investments.34 In the context of the Maldives, such ideas have shifted between Indian and Chinese policies. For example, Solih has reviewed investment commitments under the BRI, including the FTA.35 This ideational shift to a stronger alliance with India could politically drive the Maldives away from China. Despite the ‘India First’ policy, China has continued providing aid and development support to the Maldives. For example, the Maldives’ Foreign Minister Abdulla Shahid acknowledged their united efforts to fight COVID-19.36 Chinese aid, along with other development partnerships, has the potential to generate material benefits which would shape the government interests to cooperate rather than distance itself from China in a time of crisis. However, the COVID-19 pandemic is a circumstantial change that may not create ideational shifts in the current government’s stance on the Maldives–India relations.

Conclusion The Maldives’s foreign policy imperatives relating to India and China have predominantly been shaped by political ideas and ideologies of the



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present and past governments. South Asian policy experts have discussed the growing concerns in India of China’s economic expansionism in its regional sphere of influence. This includes the growth of China’s diplomatic and economic engagements in the Maldives. Traditionally, India has been the closest ally of the Maldives and has, over the years, protected and promoted the territorial integrity of the Maldives. The Maldives continues to reciprocate this neighbourly relationship by embracing an ‘India First’ policy in regional alliance building. However, India’s engagements in the Maldives can also take the form of political expansionism. Growth of China’s engagements in the island state has created political competition for India. Yameen’s government drew the Maldives away from India in terms of development cooperation by establishing stronger ties with China. Solih’s government has now re-instated the neighbourly bonds with India by expanding the latter’s military presence in the Maldives. If India wants to proactively counter the Maldives–China relations, it must aim to address the national circumstances that shape the Maldivian government’s desire to seek development cooperation from China. Despite domestic interests to coordinate maximum aid benefits, India’s strategic interests to curb China’s growth are inevitably drawing more military projects into the Maldives. How the Maldivian government and public navigate the Maldives–India engagements will determine the integrity of their political system and sustainability of political independence and territorial integrity.

Endnotes  1 See Athaulla A. Rasheed, “Ideas, Maldives–China relations and balance of power dynamics in South Asia”, Journal of South Asian Studies, 6(2), 2018, 123–139; Alexander Wendt, “Anarchy is what states make of it”, International Organization, 46(2), 1992, 394–419; Trine Flockhart, “Constructivism and Foreign Policy”, in S. Smith, A. Hadfield and T. Dunne (eds.), Foreign Policy: Theories, Actors, Cases (UK: Oxford University Press, 2016); and Sarina Theys, “Introducing constructivism in international relations theory”, E-International Relations, 2018. https://www.e-ir.info/2018/02/23/introducingconstructivism-in-international-relations-theory/.   2 Wesley W. Widnaier, “Constructing foreign policy crisis: Interpretive leadership in the cold war and war on terrorism”, International Studies Quarterly, 51, 2007, 779–794.

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 3 For more information on foreign aid support related to COVID-19, see Ministry of Foreign Affairs of the Maldives, “Media”, 2020. https://www. foreign.gov.mv/index.php/en/mediacentre/news?start=25.   4 Ministry of External Affairs India, “India–Maldives joint statement during the state visit of Prime Minister to Maldives”, 2019. https://www.mea.gov.in/ bilateral-documents.htm?dtl/31418/India Maldives+Joint+Statement+during +the+State+Visit+of+Prime+Minister+to+Maldives.   5 Vinay Kaura, “A new chapter in India–Maldives relations”, The Diplomat, 22 December 2018. https://thediplomat.com/2018/12/a-new-chapter-inindia-maldives-relations/.   6 Athaulla A. Rasheed, “Historical Institutionalism in the Maldives: A Case of Governance Failure”, The Maldives National University Journal of Research, 2(1), June 2014. https://mnu.edu.mv/wp-content/uploads/2016/12/Article-1. pdf.  7 Athaulla A. Rasheed, “Can the Maldives steer regional politics?” E-international Relations, 30 January 2019. https://www.e-ir.info/2019/01/30/ can-maldives-steer-regional-power-politics/.  8 Sanjay Kumar, “This will make the country a Chinese colony”, The Diplomat, 25 July 2015. https://thediplomat.com/2015/07/ this-will-make-the-country-a-chinese-colony/.  9 Athaulla A. Rasheed, “Ideas, Maldives–China relations and balance of power dynamics in South Asia”, Journal of South Asian Studies, 2018. https://esciencepress.net/journals/index.php/JSAS/article/view/2606. 10 J. J. Robinson, “New Maldives leader vows stability after crisis, protests”, Reuters, 18 November 2013. https://www.reuters.com/article/usmaldiveselection/new-maldives-leader-vows-stabilityafter-crisis-protestsidUSBRE9AG09L20131117. 11 Michael Safi, “Maldives quits Commonwealth over alleged rights abuses”, The Guardian, 14 October 2017. https://www.theguardian.com/world/2016/ oct/13/maldives-quits-commonwealth-over-alleged-rights-abuses. 12 The President’s Office, “Unofficial translation of the Independence day remarks by his excellency Abdulla Yameen Abdul Gayoom, President of the Republic of Maldives”, 2017. https://presidency.gov.mv/Press/Article/18056. 13 For the full speech, see the Permanent Mission of the Maldives to the United Nations, “Statement by HE Ms Dunya Maumoon, Minister of Foreign Affairs at the General Debate of the Seventieth Session of the UN General Assembly – 3 October 2015”, 15 October 2015. http://maldivesmission.com/ index.php/statements/statement_by_he_ms_dunya_maumoon_minister_ of_foreign_affairs_at_the_general_debate_of_the_seventieth_session_of_ the_un_general_assembly_3_october_2015. 14 Athaulla A. Rasheed, “Historical Institutionalism”, Journal of South Asian Studies, 6(2), 2018, 129, n. 5.



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15 State Council of PRC, “China’s foreign aid”, 2014. http://english.gov.cn/ archive/white_paper/2014/08/23/content_281474982986592.htm; “Work together to build the Silk Road Economic Belt and the 21st century maritime Silk Road: Speech by HE Xi Jinping President of the People’s Republic of China at the opening ceremony of the Belt and Road Forum for International Cooperation”, Xinhuanet, 14 May 2017. http://www.xinhuanet.com/ english/2017-05/14/c_136282982.htm; and Zhang Yanbing and Huang Yin, “Foreign aid: The ideological differences between China and the West”, CIR, 22(2), 2012. 16 See Avery Goldstein, Rising to the Challenge: China’s Grand Strategy and International Security (Stanford, CA: Stanford University Press, 2005). 17 Ibid. 18 Ministry of Foreign Affairs of China, “President of Maldives Nasheed meets with Vice Foreign Minister Zhang Zhijun”, 10 November 2011. https://www. fmprc.gov.cn/mfa_eng/wjb_663304/zzjg_663340/yzs_663350/gjlb_663354/ 2737_663478/2739_663482/t876708.shtml. 19 For the full statement, see Ministry of Foreign Affairs of the Maldives, “Press statement by His Excellency Abdulla Yameen Abdul Gayoom, President of the Republic of Maldives, on the state visit by His Excellency Xi Jinping, President of the People’s Republic of China”, 2017. https://www. foreign.gov.mv/index.php/en/media%20centre/news/2716-press-statementby-hisexcellency-abdulla-yameen-abdul-gayoompresident-of-the-republicof-maldives-on-thestate-visit-by-his-excellency-xi-jinping-presidentof-thepeople-s-republic-of-china. 20 Shannon Tiezzi, “China to India: Respect Maldives’ Sovereignty”, The Diplomat, 8 February 2018. https://thediplomat.com/2018/02/china-to-indiarespect-maldives-sovereignty/. 21 Rajeev Sharma, “India, Maldives row over airport contract”, The Diplomat, 5 December 2012. https://thediplomat.com/2012/12/india-maldivesrow-over-airport-contract/. 22 N. Manoharan, “An agenda for the new government: Policy options for India and Maldives”, Institute of Peace and Conflict Studies, 2014. http://www. ipcs.org/issue_select.php?recNo=557. 23 Humaam Ali, “Land grab and state within state are key problems: Nasheed”, Raajje, 27 April 2018. https://raajje.mv/31378. 24 Ronak D. Desai, “With a new president, can the Maldives escape China’s debt trap?”, Forbes, 29 October 2018. https://www.forbes.com/sites/­ ronakdesai/2018/10/29/with-a-new-president-can-the-maldives-escapechinas-debt-trap/?sh=5fee8e6a6e99. 25 “Abdulla Yameen: Maldives ex-leader convicted of money laundering”, BBC News, 28 November 2019. https://www.bbc.com/news/world-asia50590921.

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26 Mohamed Junayd, “Maldives’ ex-president Yameen walks free after graft conviction overturned”, Reuters, 1 December 2021. https://www.reuters. com/world/asia-pacific/maldives-ex-president-yameen-walks-free-aftergraft-conviction-overturned-2021-11-30/. 27 Viraj Solanki, “A watershed for Indian Ocean Security Cooperation”, International Institute for Strategic Studies, 21 December 2018. https://www. iiss.org/blogs/analysis/2018/12/maldives-indian-ocean. 28 Vinay Kaura, op. cit., p. 3. 29 Abhijnan Rej, “India welcomes US–Maldives defence cooperation ­agreement in a sign of times”, The Diplomat, 15 September 2020. https://thediplomat. com/2020/09/india-welcomes-us-maldives-defense-cooperation-agreementin-a-sign-of-times/. 30 “India, Maldives to sign pact on Greater Malé Connectivity Project”, Indian Express, 24 February 2021. https://indianexpress.com/article/india/indiamaldives-greater-male-connectivity-project-7471603/. 31 Government of India, “Cabinet approves opening of a new Consulate General of India in Addu City, Maldives”, 25 May 2021. https://www. pmindia.gov.in/en/news_updates/cabinet-approves-opening-of-a-newconsulate-general-of-india-in-addu-city-maldives/. 32 David Brewster, “Maldives: India first or India out?” The Interpreter, 24 November 2021. https://www.lowyinstitute.org/the-interpreter/ maldives-india-first-or-india-out. 33 Christina Zhou and Michael Walsh, “Australia pledged to ‘step up’ in the Pacific amid growing Chinese influence, but are we on track?”, ABC News, 18 January 2020. https://www.abc.net.au/news/2020-01-18/australia-pacificstep-up-in-review/11863150. 34 Athaulla A. Rasheed, “Climate ideas as drivers of Pacific Islands’ Regional Politics and Cooperation”, E-International Relations, 15 January 2020. https://www.e-ir.info/2020/01/15/climate-ideas-as-drivers-of-pacific-islandsregional-politics-and-cooperation/. 35 Anbarasan Ethirajan, “Maldives–China deal ‘one-sided’, says ex-president Nasheed”, BBC, 2018. https://www.bbc.com/news/world-asia-46269504. 36 “Maldives receives aid from China to combat COVID-19 pandemic”, Global Times, 31 March 2020. https://www.globaltimes.cn/content/1184285.shtml.

© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_0006

Chapter 6

India–China Rivalry in Nepal Pramod Jaiswal

Summary Nepal is located strategically between India and China, which is a paramount concern for both countries’ security and stability. The slightest stir in Nepal will have a spillover effect on these two rapidly growing economies. Both countries are determined to be global powers and are competing for influence in the region. As their security interests overlap, both Indian and Chinese military forces compete with each other in Nepal. This competition has intensified after Nepal became a republic and China increased its engagement in South Asia, including Nepal, through its ambitious Belt and Road Initiative (BRI). Moreover, with the ratification of Millennium Challenge Corporation (MCC) Nepal Compact, a United States’ (US) mega grant project, China’s presence in Nepal will further expand.

Introduction International politics is the realm wherein great powers are continually looking for opportunities to expand their hegemony whenever and wherever possible.1 In such a world, small states lying on the periphery of regional powers are subject to intense pressures, leading to limitations on their sovereignty. Nepal, a landlocked country, is a classic case of a small state striving to preserve its independence against challenges from China 55

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and India, its two neighbouring great powers, which have been locked in an intense security competition to expand their hegemony over the Himalayan state.2 Sandwiched between China and India, Nepal occupies a unique position in the strategic calculations of both these countries. Due to their geographical proximity, India and China have had a considerable influence on the decision-making process of Nepal.3 An unstable or hostile Nepal can skew geopolitical equations in the region and divert the attention of the Asian powers away from accelerating their economic growth and impact their security considerations. Thus, while both India and China need to keep Nepal in their sphere of influence, they can only do it gently, lest the delicate balance of power is upset. Here lies Nepal’s opportunity to play one neighbour against another to maintain its independence and ensure its progress.

Factoring China and India in Nepal The ruling regimes of Nepal have always tilted towards China for its survival whenever it has perceived any threat from India. During the monarchy, India supported the democratic movement in Nepal, led by Bishweshwar Prasad Koirala and Girija Prasad Koirala, which forced King Mahendra and King Birendra to develop closer ties with China. After Nepal became a republic in 2008, Prime Ministers Pushpa Kamal Dahal (Prachanda) and K. P. Sharma Oli also warmed up to their relations with Beijing during their first tenures as India antagonised them by supporting the opposition parties in the country. However, the duration of each tilt towards China was short-lived as India either mended its relations with them (for example, in the case with King Mahendra and in the second term of Oli) or succeeded in overthrowing them with the support of an alternative political force (for example, in the case of King Gyanendra, during Dahal’s first term in office and during Oli’s first term in office). Most of the democratic governments in Nepal were realistic and favoured stronger relations with India without sidelining ties with China. Though Nepal tilted towards China occasionally, it was careful in its response. China always considered the Nepali King as a credible and stable partner as, being the Commander-in-Chief of Nepal’s Army, he served their security interests emanating from Tibet. Even though Dahal and Oli sought stronger ties with and a deeper role for China in Nepal, the



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Chinese advice was for Nepal to maintain closer relations with India because of its geopolitical realities. After Nepal became a democratic republic, China lost its most credible partner — the monarchy — and it started to engage with the political parties, mostly the Communists due to their ideological affinities. China strengthened its relations with Nepal during Dahal’s first term in power as there were increasing anti-China (read pro-Tibetan) activities in Nepal in 2008 as the Tibetans wanted to internationalise their issue around the time of the Beijing Olympics. Similarly, during Oli’s first term, both countries signed a series of agreements aimed at ending India’s monopoly in Nepal. The most notable was the Treaty on Trade and Transit and a feasibility study of railway connectivity between China and Nepal. India has played a significant and determining role in much of Nepal’s political transition. However, the Chinese too have been active in this respect, having supported the unification of the Communist parties leading to the formation of the Nepal Communist Party (NCP) in 2018 and in resolving differences between the senior leaders of the NCP.4 It had also intensified its relations with the NCP through party-to-party contact.

Competition and Confrontation There has been intense competition between China and India in Nepal. When King Mahendra agreed to the Chinese proposal on the construction of the Kathmandu-Kodari road, the first opening between the two countries in the 1960s, India was disappointed as the road would prove to be of strategic importance to China. India argued that the road would facilitate the movement of the Chinese armed forces right up to the Nepalese border.5 During the Indian Lok Sabha session on 25 November 1961, Indian Prime Minister Jawaharlal Nehru stated that India’s security concerns would be adversely affected by the road and that it violated the 1950 Indo-Nepal Treaty of Peace and Friendship as Nepal did not consult India regarding the issue. Nepal criticised India arguing that the matter was an internal affair. Similarly, during the construction of the East–West Highway in 1983, China proposed to take up the construction of the segment of the highway between Kohalpur to Banbasa as India had withdrawn from an earlier commitment to build this road. This segment was strategically susceptible

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for India as it was just across the Mahakali River, which was the border between Nepal and India. Nepal had to negotiate a loan from the World Bank and the Arab Fund and declined China’s investments in an attempt to address Indian sensitivities. Later, India sanctioned ₹500 million (S$9.2 million) as grant assistance to Nepal for the project but Nepal had to pay US$2 million (S$2.8 million) as compensation to China for breaching the contract.6 The competition for influence along the Nepal–China border has continued till today. In 2010, India provided development assistance of ₹100 million (S$1.8 million) for the remote hill region of Mustang. Soon after, China responded with financial assistance worth ₹10 million (U$184,000) for the construction of a library, science laboratory and school building with computers in Chhoser village (adjoining Jhongwasen district of Tibet) in the same region to counter Indian influence. The ambassadors of both countries visited the area. In response to several Indian and western-funded non-governmental organisations, there has also been an increasing number of Chinese-funded non-government organisations being established in Nepal. China plans to connect Nepal with its Qinghai Railway, which the Chinese government hails as one of modern China’s greatest feats. The railway, which connects Beijing to Lhasa in Tibet, has completed its construction till Xigaze. It is expected to be extended to the Nepalese border, Keyrong, and further to Kathmandu, Pokhara and Lumbini. In response to the railway, India has proposed to extend its rail links to Nepal at six points along the border. These are from Raxaul, Jogbani and Jayanagar in Bihar to Birgunj, Biratnagar and Bardibas in Nepal. In Uttar Pradesh, the line will connect Nautanwa and Nepalgunj, and in West Bengal, it will connect New Jalpaiguri with Kakarbhitta. India has announced assistance worth ₹10.88 billion (S$200.2 million) for the expansion of the railway service in five places along the India–Nepal border.7 The first phase of the railway line was inaugurated in December 2018 by Uttar Pradesh’s Chief Minister, Yogi Adityanath. Furthermore, in May 2018, India again proposed to connect Raxual of India (Birgunj in Nepal) to Kathmandu with the railway line. Similarly, there is intense competition between India and China in providing development projects to Nepal. China ranked as Nepal’s fourth largest bilateral development partner by disbursement in FY2017/18, after the United Kingdom, the US and Japan, while India occupied fifth place. In FY2011/12, India disbursed US$50.6 million (S$70.4 million) to



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Nepal, while China disbursed US$28.3 million (S$39.4 million). However, by FY2017/18, China had overtaken India. It provided US$58.7 million (S$81.7 million) to Nepal while India provided US$56.7 million (S$78.9 million). Out of China’s total funding, almost two-third was in the form of grants, while the remainder was a loan. In contrast, India’s funding comprised 70 percent grants and 30 percent loans. Hence, in terms of grants, India is still ahead of China.8 China and India are also competing for influence in the security sector in Nepal. Military ties between Nepal and India have been deep-rooted and historic. Nepalese Gurkhas have participated in all operations undertaken by the Indian army since its independence. India has been providing weapons to Nepal’s army, with 70 percent of the aid in the form of grants, since 1962. Following the conclusion of the peace process and with the integration of the former Maoist combatants into the Nepal army, Nepal sought US$18.33 million (S$25.5 million) worth of military supplies from India.9 It constructed the National Police Academy and several other military infrastructures and trainings. Similarly, a major portion of Chinese assistance is channelled to the security sector as it wants Nepal to curb anti-China (pro-Tibetan) activities along its borders. Since Chinese Defence Minister Chi Haotian’s visit to Kathmandu in February 2001, there has been rapid increase in Chinese assistance in the security sector. There have been high-level visits by the heads of the Chinese People’s Liberation Army and Nepal army. The most recent is the visit by Chinese Defence Minister and State Councilor, Chang Wanquan, in 2017 and State Councilor and Defence Minister, Wei Fenghe, in 2020.10 In response to the regular joint military exercise between India and Nepal, China has also been organising a joint military exercise since April 2017. The first was a 10-day long military drill called ‘Sagarmatha Friendship’, organised in Nepal in July 201811 and the second edition of the 10-day long joint military exercise ‘Sagarmatha Friendship-2’ was held at Chengdu in Sichuan Province in September 2018.12 Until April 2017, the Nepalese army only held military exercises with India and the US. Furthermore, China had supported the construction of the United Nations Regional Peace Keeping Centre at Panchkhal. It has also increased the number of places for the training of senior Nepalese army officers in its military academy. In 2018, China doubled its military aid to Nepal, amounting to over US$22 million (S$30.7 million). Besides, China also provides equipment and training to the Nepalese army.

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Similarly, with the growing Chinese interest in Nepal in recent years, the volume of Nepal–China trade has shown positive growth. Nepal’s trade with China largely flows through Tibet and Hong Kong. The two countries have opened six points along the Nepal–China border for overland trade. These are Kodari-Nyalam; Rasuwa-Kerung; Yari (Humla)-Purang; Olangchunggola-Riyo; Kimathanka-Riwo; and Nechung (Mustang)-Legze. Similarly, during the visit of Nepal’s President Bidhya Bhandari to Beijing in April 2019, both countries signed the protocol on implementing the Agreement on Transit and Transport. According to the agreement, Nepal can use four Chinese seaports in Tianjin, Shenzhen, Lianyungang and Zhanjiang and three land ports in Lanzhou, Lhasa and Shigatse for third-country imports. It will also allow Nepal to carry out exports through six dedicated transit points between Nepal and China.13 The agreement is likely to further boost Nepal–China trade. According to the Economic Survey of 2017/18 of the Nepal Ministry of Finance, while Nepal’s merchandise exports to India increased by 9.8 percent during the first eight months of the fiscal year 2017/18, exports to China grew by a massive 62 percent. Exports to the other countries grew by 9.1 percent in the same period. According to Nepal’s Department of Industry, since 2013, China has also overtaken India in several investment projects. In FY2012/13, 575 Chinese companies acquired approval for investments from the Department of Industry, compared to 566 from India.14 Chinese and Indian investments overlap in Nepal, especially in sectors like tourism, hydropower and cement. Apart from these, Chinese investment interest also lies in hotels, restaurants, electronics, cell phone services, radio paging services, readymade garments (pashmina), nursing homes, hydropower and civil construction while Indian investors are interested in paint, steel industries, banks and education.15 Moving forward, China is likely to further expand its footprints in the economic sector in Nepal. In recent times, Chinese companies have also been taking over major construction contracts in Nepal. According to Raman Mahato, Executive Director at Raman Construction Pvt Ltd., Chinese construction companies are about to control almost all the contracting business of Nepal.16 Indian banks have limited presence in Nepal; the most notable being the joint venture of the State Bank of India and Punjab National Bank in July 2019. Nepal’s Rastra Bank has now granted a licence for the payment system operation to Chinese financial services corporation, UnionPay International, to roll out its financial services in Nepal.17



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Chinese aid projects are also more visible compared with those of the Indians and are generally large and centrally located. China has the advantage of having less ambitious objectives, that is, to counter the threat to its security from the Tibetan rebels and enhance its influence within Nepal to that effect, and it uses its aid in that direction. India, contrarily, has diverse objectives, uncoordinated activities among its agencies and an exaggerated sense of its influence (otherwise natural) in Nepal. Furthermore, India-aided projects are undertaken in a haphazard manner without serious thinking — these are normally done to mark bilateral visits of prime ministers and other dignitaries and special occasions of India like the Republic Day and Independence Day. There is little homework and planning to allocate these projects strategically to meet the larger developmental needs of Nepal and manage popular perceptions about India in Nepal. Chinese aid in the initial phase focused on promoting industries, along with infrastructure building in Nepal to have multiple effects from its aid programmes and indirectly decrease its economic dependence on India. Meanwhile, India invested in road construction that has facilitated the expansion of the Indian market in Nepal as well as opened the Indian market to Nepal and enhanced connectivity between the two countries. India’s support for building the Siddhartha Highway is one such example. There is a dominant perception in Nepal that Indian policy of investing in roads and communication is basically to serve its interests — to use Nepal as an extended market for Indian goods and encourage cheap Nepalese migrant labour into India. Moreover, the Nepalese believe that Indian projects come with many conditions and the delivery of projects is usually delayed, unlike the Chinese, who finish their projects on time. In fact, in recent times, there are also several Chinese projects which have not reached their completion in the stipulated time. With relatively smaller stakes, China has comparatively reaped better dividends than India in its engagement with Nepal. As China’s engagement with Nepal deepens, riding on the perception of China as a benign neighbour with limited interests in Nepal, its influence is likely to grow. In such a situation, where there is inadequate understanding of India’s strategic compulsions and interests, India will have to significantly modify its engagement strategy, keeping in mind its weakness in delivery capacity and the adverse popular perception of it as a wily and scheming neighbour.18

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The Path Ahead As a result of the political instability in Nepal, there has been increasing interest from India and China. While India resumed its top-level visits to Nepal after 17 years, with Prime Minister Narendra Modi making three visits in four years after coming to office in 2014, Chinese President Xi Jinping visited Kathmandu in 2019 after a hiatus of 23 years. During their respective visits, both leaders pledged to provide railway connectivity to Kathmandu, increase development assistance and enhance trade and cooperate on matters relating to security and border management. In May 2017, China and Nepal signed a memorandum of understanding on the BRI.19 However, despite its signing, both countries have failed to agree on any major BRI projects in Nepal in the last five years. Similarly, the railway connectivity project, which was highly publicised, has not made headway due to India’s displeasure towards such projects. However, having said that, as highlighted in this chapter, the economic engagement between Nepal and China is growing and will further deepen in the coming years. On the other hand, India’s leverage in Nepal became limited during Oli’s tenure as prime minister. The ‘economic blockade’ of Nepal by India in 2015 did not help its cause as many Nepalese saw it as India’s high-handedness against its small neighbour. The border row between India and Nepal, with strong comments on Chinese involvement by the incumbent Indian Chief of Army Staff, General M. M. Naravane, and Indian media, has further fuelled anti-India feelings in Nepal.20 On the contrary, China, which was seen as ‘non-interfering’ neighbour in the past, is being criticised for its increasing involvement in the domestic affairs of Nepal. The Chinese and the senior leaders of CPC could not protect the NCP from the split despite their intense pressure on the left leaders. External factors will also contribute to intensifying the India–China rivalry in Nepal. China was not comfortable with the MCC Nepal Compact, a US$500 million (S$679.4 million) grant from the US to build power and road infrastructure projects, which has been finally ratified by the Nepalese parliament. Beijing has predicted that Washington is going to be more proactive in Nepal, especially considering Washington’s push to ratify the MCC in Nepal. China considers the development project as an important initiative under the US’ Indo-Pacific strategy that it believes is created to counter China’s influence in the region.



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Similarly, China is irked by India’s active role in the Indo-Pacific region and in the Quadrilateral Security Dialogue (also called the Quad) and sees India challenging its interest in the Indian Ocean. Under these circumstances, China has opened fronts in the Himalayas where India has concerns. The border standoff in Bhutan, border encroachment by the Chinese in Humla in Nepal and border standoff with India in Sikkim, Ladakh and Arunachal Pradesh are recent examples. Hence, the India–China competition in the Indo-Pacific region is bound to intensify their rivalry in the Himalayas. New Delhi needs to make some serious and important policy reorientations in its relationship with Nepal. Otherwise, their bilateral ties will face some challenging times ahead. The increasing presence of the Chinese in Nepal and the South Asian region will certainly not help India’s position — not with Beijing being keen to further enhance its presence in the Himalayan kingdom.

Endnotes   1 Kenneth N. Waltz, Theory of International Politics (Reading Mass: AddisonWesley Publication Co., 1979), pp. 72–73.   2 M. Dabhade and H. Pant, “Coping with challenges to sovereignty: Sino-Indian rivalry and Nepal’s foreign policy”, Contemporary South Asia, 13(2), 2004. https://www.tandfonline.com/doi/abs/10.1080/0958493042000242945.   3 Jawaharlal Nehru, India’s Foreign Policy (New Delhi: Government of India, 1961), pp. 42–43.   4 “In a series of meetings, Chinese envoy calls for unity among ruling party members”, The Kathmandu Post, 2 May 2020. https://kathmandupost.com/ politics/2020/05/02/in-a-series-of-meetings-chinese-envoy-calls-for-unityamong-ruling-party-members.  5 B. C. Upreti, Uneasy Friends: Readings on Indo-Nepal Relations (New Delhi: Kalyan Publications, 2001), p. 3.  6 Ibid, p. 105.   7 Pramod Jaiswal, “IDSA comment: India–China power game in Nepal and the consequences”, Manohar Parrikar Institute for Defence Studies and Analyses, 16 September 2010. http://www.idsa.in/node/5970/1703.  8 Economic Survey 2017/18, Ministry of Finance, Government of Nepal. https://mof.gov.np/uploads/document/file/for%20web_Economic%20 Survey%202075%20Full%20Final%20for%20WEB%20_20180914091 500.pdf.

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  9 Pramod Raj Sedhain, “India–Nepal military: Relation and aid”, The Daily Journalist, 2014. http://thedailyjournalist.com/the-strategist/india-nepalmilitary-relation-and-aid/. 10 Foreign Ministry announces Chinese Defence Minister Wei Fenghe’s visit to Nepal, The Kathmandu Post, 28 November 2020. https://tkpo.st/33lUJKQ. 11 “Nepal, China hold first-ever joint military exercises” The Economic Times, 12 July 2018. https://economictimes.indiatimes.com/news/defence/nepalchina-hold-first-ever-joint-military-exercises/articleshow/58208949.cms? utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst. 12 “Nepal, China military drill to be held in September”, Business Standard, 21 July 2018. https://www.business-standard.com/article/news-ians/nepalchina-military-drill-to-be-held-in-september-118072100288_1.html. 13 “Nepal signs deal with China to access seven Chinese sea and land ports”, The Kathmandu Post, 30 April 2019. https://kathmandupost.com/ national/2019/04/30/nepal-signs-deal-with-china-to-access-seven-chinese-seaand-land-ports. 14 “China overtakes India in project numbers”, Sharesansar, 1 November 2013. https://www.sharesansar.com/newsdetail/china-overtakes-india-in-projectnumbers. 15 A Survey Report on Foreign Direct Investment in Nepal, Nepal Rastra Bank, June 2018. https://www.nrb.org.np/contents/uploads/2020/04/Study_ Reports-A_Survey_Report_on_Foreign_Direct_Investment_in_Nepal.pdf. 16 “Chinese contractors have captured almost all the contracting business of Nepal: Raman Mahato”, Reporters Nepal, 22 February 2019. https:// en.reportersnepal.com/2019/02/253459. 17 “Chinese UnionPay International gets license of payment system operator in Nepal”, Republica, 24 July 2019. https://myrepublica.nagariknetwork.com/ news/chinese-unionpay-international-gets-license-of-payment-systemoperator-in-nepal/?categoryId=blog. 18 Pramod Jaiswal, India–China–Nepal: Decoding Trilateralism (New Delhi: G B Books, 2016), pp. 93–94. 19 “Nepal signs MoU on OBOR with China”, The Himalayan Times, 12 May 2017. https://thehimalayantimes.com/kathmandu/nepal-signs-mou-relatedobor-china/. 20 In May 2020, India and Nepal were drawn into a diplomatic standoff over their border. In November 2019, India had published an updated map that included Kalapani as a part of Pithoragarh district of the Indian state of Uttarakhand. This led to the ire of the Nepalese who consider Kalapani as part of their territory. See Amit Ranjan, “India–Nepal Tensions: The Issue of Lipulekh”, ISAS Working Paper No. 325, Institute of South Asian Studies, National University of Singapore, 5 June 2020. https://www.isas.nus.edu.sg/ wp-content/uploads/2020/06/325-1.pdf.

© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_0007

Chapter 7

China and Pakistan: From Tactical Alliance to Strategic and Economic Interdependence Touqir Hussain

Summary What began as a tentative tactical alliance between China and Pakistan 70 years ago has matured into an extraordinary relationship of mutual strategic and economic dependence. Its core stimulus still remains the China–India rivalry and India–Pakistan conflict but, as India has risen and China has resurged, these rivalries are beating to the rhythm of new historical changes with South Asia becoming an arena for shifting and overlapping coalitions among the regional and global players at the centre of which lies the emerging new ‘Cold War’ between China and the United States (US). This chapter looks at this developing political and security landscape and its implications for peace in South Asia, especially with India and Pakistan respectively having found common purposes in American and Chinese strategic objectives in the region and beyond.

Remote Origins The China–Pakistan ‘all-weather’ friendship began in 1951. Both countries were isolated. They felt insecure and faced common challenges. 65

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Pakistan saw India as a primal threat while China viewed India as a potential rival. Pakistan faced enormous economic and security challenges and struggled for its survival. China and Pakistan recognised each other’s challenges and constraints and thus began their tentative relationship, which has come a long way from its modest origins. In nearly seven decades of friendship, China and Pakistan have responded consistently well to the evolving regional, global and geopolitical context. In a culmination of this sustained process, their partnership “has gone beyond bilateral dimensions and acquired broader regional and international ramifications…and matured from a tactical alliance to strategic partnership”.1

Tactical Alliance The first time China and Pakistan saw an exceptional value in their relationship was following the 1962 Sino-Indian war and the US support for India that shocked Pakistan, being Washington’s ally. Beijing and Islamabad anticipated the future implications of these developments in nearly identical terms. This led to their boundary agreement of 1963. The 1965 India–Pakistan war further gave China an opportunity to demonstrate its support for Pakistan and it took advantage of the situation masterfully. China skillfully went through the motions of acting as Pakistan’s natural ally without risking a military conflict with India. In the process, it earned great public acclaim and gratitude in Pakistan. After the US suspended arms transfers to both India and Pakistan following the 1965 war, which affected Pakistan more than India, it retreated from the region while leaving behind the contradictions in the US–Pakistan relations that became apparent to Islamabad. Pakistan’s need for a new benefactor following the ‘betrayal’ by Washington and China’s search for an ally triggered by the Sino-Indian conflict and emerging tensions with Moscow (which was backing India) were a perfect fit. And Pakistan’s relations with China took off. For China, it was an investment in the future; for Pakistan, it was the fulfilment of an immediate need, providing as it did, a big power support to help it cope with its security and foreign policy challenges and economic development needs. These set up an important feature of the future relationship. In its hour of need, Pakistan could always look up to China.



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Although China could not offer much economic assistance, it began meeting Pakistan’s defence requirements and started a major highway project — the Karakoram Highway — to lay the foundation of a future role in Pakistan’s economic development. In time, Beijing went on to help Pakistan with such landmark projects as the Heavy Mechanical Complex, Chashma nuclear power plants, Heavy Rebuild Factory and Guddu Power Project, among others. Half a century later, China became a commanding force of change for Pakistan’s economic future with the China–Pakistan Economic Corridor (CPEC) project. Over the years, China also became a dependable defender of Pakistan in the United Nations (UN) and other regional and global forums where India challenged Pakistan.2 And it has been helping Pakistan diplomatically on the Kashmir dispute.

From Alliance to Reliance India continued to provide a core stimulus in bringing China and Pakistan closer to each other in more ways and for more reasons than did the US, which kept weaving in and out of the relationship with Pakistan, thereby injecting an element of uncertainty that Islamabad could not live with. India’s rivalry with China was constant as was China’s response to it, alongside China’s need for Pakistan. So, when Pakistan and China described their relations as ‘an all-weather friendship’, it was more than a cliché. As bilateral relations progressed, China took advantage of Pakistani public perceptions of a hostile India and unreliable America to build a romanticised image of China–Pakistan relations. It guided the terms of engagement but shrewdly gave Pakistan an illusion of being an equal partner in the midst of growing anti-Americanism in Pakistan that further made China look, by contrast, an unselfish and eternal ally. This lowered the threshold of disappointment on both sides. Ever mindful not to cross the threshold, the two countries have gone overboard with soaring rhetoric to illustrate the relationship. It served many purposes, especially of submerging any differences of policy and perceptions in the flood of rhetoric. Over the years, China has enabled Pakistan to develop a credible deterrence against India that became the bedrock of China’s gleaming image in Pakistan. Beijing’s contribution to Pakistan’s defence capability

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began in the late 1960s with the supply of modest quality Chinese defence equipment that finally led to its presumed help in Pakistan’s nuclear weapons and ballistic missiles programmes.3 And, today, China is the most reliable source of modern military hardware and technology to Pakistan. From 2009 to 2018, Pakistan imported US$6.17 billion (S$8.6 billion) worth of arms (58.42 percent of its total arms imports) from China.4 Pakistan is also in negotiations to buy the longer-range Chinese HQ-9 system, a Chinese analogue to the Russian S-300 long-range surface-to-air missiles.5 The two countries jointly manufacture military aircraft and other weapons systems, notably JF-17 multirole combat aircraft, Al-Khalid or MBT-2000 and the A-100 multiple rocket launcher. The language used in the official communications and documents of the two countries over the years reflects the historical progression of the relationship: In the early years, the relationship was merely described as ‘friendly relations’; in the 1980s, it was ‘traditional friendship’; in the1990s, it evolved into ‘comprehensive friendship’; the 2003 Joint Declaration on Direction of Bilateral Cooperation called it an ‘all weather friendship’; the 2005 Treaty of Friendship, Cooperation and Good Neighborly Relations termed it as ‘bilateral strategic partnership of good neighborly friendship’ and in July 2013, when the CPEC was launched, it was ­evaluated as the ‘China Pakistan all weather strategic cooperative partnership’. By 2018, it had been elevated to ‘China Pakistan all weather strategic cooperative partnership and building closer Pakistan China community of shared future in the new era’.6

Rivalries, Insecurities and Mistrust With China’s resurgence and India’s rise, the China–India rivalry too has been escalating, manifesting itself at both the political-strategic and military-strategic levels. The ideational competitiveness arising from high levels of nationalism in both has resulted in its intensification.7 There is today an arms competition ‘chain’ in which Beijing responds to Washington and, in turn, New Delhi to Beijing (and then Islamabad to New Delhi).8 Responding to China’s military and economic rise, India and the US have reached out to each other since the late 1990s to build a relationship



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that incorporates strategic consultation, military collaboration and arms transfers. India, along with Japan and Australia, is also part of the American-led four-nation group the Quadrilateral Security Dialogue (also called the Quad) — which is a linchpin of Washington’s IndoPacific strategy. “South Asia is fast emerging as a sub-region of the larger Indo-Pacific theatre where US–China rivalry is now in full play”.9 India’s strong relationship with Washington and adversarial relationship with Pakistan, China’s ally, serves not only India’s own interest to stand up to China but also advances the US’ policy of balancing China by strengthening India and containing Pakistan. Indian Prime Minister Narendra Modi’s Pakistan policy has found common purpose in the US’ strategic objectives in the region. India’s hardline stand against Pakistan used to be restricted by US–Pakistan relations. Now, the two run parallel as American and Indian interests have both come to focus negatively on Pakistan on many issues. The US’ policies in South Asia that once hampered India’s regional goals are now advancing them. The US and India’s opposition to the CPEC has knitted their South Asia strategies together serving varying objectives towards Pakistan. While New Delhi aims to weaken it, Washington wants Pakistan to be a weak ally of China but capable enough to serve American purposes. It is not in the US’ interest to destabilise Pakistan, as US–India relations cannot address all of Washington’s challenges in the region. Yet, with the India–Afghanistan relationship pivoting on close cooperation on Pakistan on one side and the US–India strategic partnership on the other, from which Pakistan faces both collateral and intended damage, it understandably feels under siege. And, as India and the US rely on each other, it also creates insecurities in China.10 “The China–Pakistan partnership serves the interests of both by presenting India with a potential two‐front theatre in the event of war with either country distracting New Delhi from the task of reaching its potential as a major regional and global player”.11

China’s Lengthening Strategic Shadow With the Belt and Road Intitiative (BRI) project, for which the CPEC represents a critical platform, China has found a new meaning in its

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relations with Pakistan.12 China’s fast-growing demand for energy sources and markets for its Western regions and investment opportunities for its companies has augmented Pakistan’s importance by virtue of its geostrategic location. Above all, Pakistan helps advance China’s surging global economic and strategic ambitions. It has made China and Pakistan greatly interdependent, further raising Beijing’s stakes in Pakistan. China cannot afford the failure of the CPEC as this would spell the failure of the BRI. China now has a vested interest not just in defence but also in the economy of Pakistan and its international standing. No wonder, it has managed to shield Pakistan from being blacklisted by the Financial Action Task Force. And it has also blocked India’s entry into the Nuclear Suppliers Group without Pakistan. The importance of the CPEC has grown because of Gwadar Port’s deep-sea port, its geo-strategic location and the reliance of the landlocked Central Asian states and China’s Xinjiang province for access to the sea for its products. Gwadar has the capacity for Pakistan to foster economic growth and strategic partnerships with other countries.13 To Pakistan, the CPEC is designed to help strengthen its economic foundation by addressing its development deficit while putting Pakistan on the path to sustainable economic growth. It is also perceived to be able to improve Pakistan’s image as a business-friendly country while allowing China, already Pakistan’s largest trading and foreign direct investment partner, to invest more in Pakistan. Overall, it will boost Pakistan’s capacity to serve China’s economic and strategic purposes. The CPEC is also expected to raise Pakistan’s own stake in its economic prosperity and political stability, strengthening its resolve to fight against militant organisations. Pakistan will also have a vested interest in the security of north-western China, the stability of which is critical to the success of the CPEC. This, in turn, may bring strategic clarity to Pakistan’s Afghanistan policy for its own sake and for the sake of the success of China’s BRI project. “The success of China’s huge investment (however) depends upon Pakistan’s own ability to maintain its security and stability. It is on Pakistan to make this huge Chinese investment sustainable and valuable in the long term”.14

A New Partnership China realises that it has few allies in the current US–China Cold War. The US, with its traditional alliances in Asia to which has been appended its



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Indo-Pacific strategy, and an extraordinary relationship with India, is the predominant power in Asia. China has to meet this challenge through a well-calculated and clever strategy. Not only does China have to avoid a two-front war with the US and India and focus on the US by lowering tensions with India but it also has to prioritise the Asia-Pacific region over South Asia.15 China is cognisant of the trouble India can incite in Tibet, Xinjiang and Pakistan’s Northern Areas of Gilgit Baltistan. This will encircle China in its periphery. Yet, China’s own border dispute with India involving Kashmir can harden its stance against India if required. China is thus not without options. It can ramp up support for Pakistan and raise the pressure on the border with India. Following the Indian action of 5 August 2019 to abrogate Kashmir’s special status, China twice raised the matter in the UN Security Council and took a hard stance in the 2020 border tensions with India. The Chinese have been clearly provoked16 by the Indian decision to turn Ladakh into a Union territory, which C Raja Mohan refers to as Modi’s “discarding of India’s political defensiveness on the Kashmir dispute”.17 Pakistan too feels aggravated. The Kashmir dispute gives China and Pakistan a shared interest and opportunity, but for their own reasons, to put a coordinated pressure on India. In sum, Pakistan has literally become the sole strategic partner of China in Asia, serving the latter’s interests not only in South Asia but also indirectly in the Indo-Pacific context. Across the larger BRI and, more specifically, the CPEC and Gwadar, China will be able to side-step the US and its ‘allied’ naval dominance across the Indo-Pacific, using Chinese leader Mao Zedong’s strategy, “The enemy advances, we retreat; the enemy camps, we harass; the enemy tires, we attack; the enemy retreats, we pursue”.18 The view that the US has been withdrawing from Central Asia, the Middle East and Afghanistan makes the Chinese believe that it opens doors for China.19 For Pakistan also, the China relationship has become ever more important. The centrality of this relationship to Pakistan’s foreign policy was further solidified during the visit to China by Prime Minister Imran Khan from 3 to 6 February 2022. A series of new agreements were signed during the visit that took place during the Winter Olympic and was thus also meant to highlight support for Beijing in this period of diplomatic tensions with the West. The China–Pakistan joint statement on the visit, apart from other things, reaffirmed their growing economic ties. According

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to the statement, the two countries pledged “bilateral cooperation in areas of economic and technical, industry, investment, infrastructure, space, vaccine, digitalisation, standardization, disaster management, culture, sports and vocational education”.20

Looking beyond the Strategic Relationship with China Pakistan’s growing challenges like the uncertain headwinds over Afghanistan’s future, continued pressures from an assertive and dominant India, threats from terrorism and extremism (internal and cross border) and an economy which is struggling are emerging as important influences on foreign policy whose orientation Pakistan would like to change from geopolitics to geo-economics. Also weighing on the mind of the foreign policy establishment may be the “new wave of terrorism, with Balochistan as its primary target” and the “killings along the Pak–Afghan border plus sporadic IED [improvised explosive device] attacks…on police stations in Islamabad, Peshawar and Lahore”.21 Successful navigation of these challenges will require good relations with all the big powers more so as the Ukraine crisis may end up strengthening the Western alliance whose combined weight would be difficult to resist or oppose. Pakistan may have concluded that while its foreign policy must remain anchored in the strategic relationship with China, it should strengthen its relations with the West. That must include a working relationship with Washington which also needs Pakistan.22 Islamabad’s decision to skip US President Joe Biden’s Democracy Summit in December 2021, followed by the offer to be a bridge between the US and China, clearly signals Pakistan’s desire to be in both camps. This would be an effective way to deal with the schism that had lately been caused in Pakistan’s strategic thinking by the US–China tensions. Pakistan probably feels the relationship with Washington may or may not bring benefits but would spare Pakistan being a target of US pressures as part of US–China competition in case Pakistan opted for a total alignment with China. As part of expanding the ties with the big powers, Pakistan is also seeking friendly ties with Russia.23 Khan followed up his high-profile visit to China in early February 2022 with a visit to Russia later in the month. Pakistan’s Foreign Minister Shah Mehmood Qureshi said after the visit



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that one of the objectives of the visit “was to enhance and maximise Pakistan’s diplomatic space in the fast-changing global politics”.24 Meanwhile, the US too has been watching. It is no coincidence that right during Khan’s visit to Beijing, the US State Department spokesperson, Ned Price, said, “Pakistan is a strategic partner of the United States. We have an important relationship with the government in Islamabad, and [it is] a relationship that we value across a number of fronts”.25 Indeed, rare words in recent decades! He added Washington is not asking countries to choose between the US and China.

Conclusion Pakistan has decided to affirm its strategic relations with China but seeks an opening to the US. The US is maintaining its strong relations with India but may possibly open to Pakistan. Pakistan’s growing outreach to the big powers could thus change the strategic landscape in the region, giving a new dimension to the historical Pakistan–China relations. Pakistan–China relations, which began as a response to China–India rivalry and Pakistan’s insecurities vis-à-vis India, have come a long way. For both countries, the relations are no longer about India. For India too, the relations with both China and Pakistan are not just about these two countries. India’s Pakistan policy has become a footnote in its relationship with Washington. And its China policy is a subset of Washington’s China policy. Finally, Russia too has become part of the equation. This strategic kaleidoscope could change further as the long-term implications of the Russian invasion of Ukraine and its impact on the post-Cold War international order become clearer. When the balance of power becomes many sided, it arguably enhances the prospects of peace and stability giving countries greater options — to ramp up the conflicts or ease them. However, will this happen in South Asia? India and Pakistan have so far found common purposes in American and Chinese strategic objectives in the region and beyond and are benefiting from it. But for how long? With so many interlocking interests, the US and China are likely to eventually find a modus vivendi — one may call it ‘competitive coexistence’ or ‘managed strategic competition’, as the international system cannot bear the strain and uncertainty of perpetual and unresolved tension between the big powers as it raises the prospect of conflict and economic uncertainty.

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For similar reasons, China may want to find a way to coexist peacefully with India. As China expands its relations with Pakistan and enhances its role as an accessory to its strategic reach in the region and beyond, it gives China flexibility to use the relationship in dealing with India. It enables Beijing to up the ante or compromise. One of its concessions to India could be that China helps to moderate Pakistan’s stance on the Kashmir dispute by counselling Pakistan to put the dispute on the back burner. To Pakistan, the messaging from China has been to strive for a peaceful coexistence with India and friendly relations with the US so that Pakistan can increase the space for its economic development.26 US– Pakistan relations will also help moderate India’s Pakistan policy just as China–Pakistan relations can help moderate Pakistan’s India policy. China does not want a long-term conflict with India nor does it want Pakistan to live in conflict with India more so as China does not want to fight its friends’ wars. “China no longer believed in military interventions in support of friends, such as it had made earlier for North Korea and Vietnam”.27 Pakistan could thus possibly become a role model of a country which has good relations with both China and the US. Pakistan, having had the closest of relations with both the US and China at one time or another, could be an ideal test case of peaceful competition between the two, fusing geopolitics and geo-economics. All that may or may not happen as one never knows what picture might emerge in the future strategic arrangements and alignments in the region. However, should the above projection, which remains only one of the probable scenarios, albeit the best-case scenario, come true, it might create conditions propitious for the long-awaited normalisation of relations between India and Pakistan. And that will be a good development for the two countries, the region as well as global politics.

Endnotes   1 Khalid Mahmood, “Pakistan–China strategic relations”, Institute of Strategic Studies Islamabad, 4 August 2011. http://issi.org.pk/pakistan-chinastrategic-relations/.   2 Munir Akram, “A strategic challenge”, Dawn, 29 April 2018. https://www. dawn.com/news/1404556.



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  3 Arif Rafiq, “Corona Virus Fall out will test the China Pakistan relationship more than ever before”, The National Interest, 9 May 2020. https:// nationalinterest.org/feature/coronavirus-fallout-will-test-china-pakistanrelationship-more-ever-152736.   4 Rajesh Basrur, “Friction with a rising China India and China: A managed nuclear rivalry?” The Washington Quarterly, October 2019. https://www. tandfonline.com/doi/abs/10.1080/0163660X.2019.1666354.   5 Charlie Gao, “Pakistan has China to thank for these powerful weapons”, The National Interest, 5 May 2020. https://nationalinterest.org/blog/buzz/ pakistan-has-china-thank-these-powerful-military-weapons-151276.   6 Khalid Masood, “Pakistan-China relations in a changing geopolitical environment”, ISAS Working Paper No. 357, Institute of South Asian Studies, National University of Singapore, 30 November 2021. https://www.isas.nus. edu.sg/wp-content/uploads/2021/12/WP-357-1-1.pdf.   7 Rajesh Basrur, “Friction with a rising China. India and China: A managed nuclear rivalry?” op. cit.   8 Robert Einhorn and W. P. S. Sidhu, “The strategic chain: Linking Pakistan, India, China and the United States”, Brookings Institution, March 2017. https://www.brookings.edu/research/the-strategic-chain-linking-pakistanindia-china-and-the-united-states/.   9 Khalid Masood, “Pakistan–China relations in a changing geopolitical environment”, op. cit. 10 Marvin Weinbaum and Syed Mohammad Ali, “Seizing the moment: New pathways to US Pakistan relationship”, Middle East Institute, Washington, 3 March 2020. https://www.mei.edu/publications/seizing-moment-changepathways-sustainable-us-pakistan-relationship. 11 Harsh Pant, “The Pakistan Thorn in China-India-U.S. relations”, The Washington Quarterly, 35(1), 16 December 2011. https://www.tandfonline. com/doi/abs/10.1080/0163660X.2012.642294. 12 Khalid Mahmood, “Pakistan–China strategic relations”, Institute of Strategic Studies, Islamabad, Pakistan, 4 August 2011. http://issi.org.pk/ pakistan-china-strategic-relations/. 13 Maqsood Asia, “China-Pakistan strategic partnership and India’s regional ambitions in South Asia”, Institute of Strategic Studies, Islamabad, Pakistan, October 2021. https://www.issi.org.pk/wp-content/uploads/2021/10/4_SS_ Asia_Maqsood_No-3_2021.pdf. 14 Ibid. 15 Yun Sun, “China’s strategic assessment of India”, War on the Rocks, 25 March 2020. https://warontherocks.com/2020/03/chinas-strategicassessment-of-india/. 16 Ashley Tellis, “Hustling in the Himalayas: The Sino-Indian border confrontation”, Brookings Institution, 4 June 2020. https://carnegieendowment.

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org/2020/06/04/hustling-in-himalayas-sino-indian-border-confrontationpub-81979. 17 C. Raja Mohan, “Modi’s World: Changing the terms of India’s Global Engagement”, The Strait Times, 30 May 2020. https://www.straitstimes.com/ opinion/modis-world-changing-the-terms-of-indias-global-engagement. 18 “A Single Spark Can Start A Prairie Fire”, Selected Works of Mao Tse-tung, 5 January 1930. https://www.marxists.org/reference/archive/mao/selectedworks/volume-1/mswv1_6.htm. 19 The author’s conversation with Ms Yun Sun, Senior Fellow and Co-Director of the East Asia Program and Director of the China Program at the Stimson Center, United States, on 13 June 2020. 20 Ali Siddiqi, “The implications of deepening economic ties between Pakistan, China”, VOA News, 15 February 2022. https://www.voanews.com/a/theimplications-of-deepening-economic-ties-between-pakistan-china-/ 6443711.html. 21 Nasim Zehra, “Pakistan’s growing security challenge”, The Arab News, 21 February 2022. https://www.arabnews.pk/node/2028946. 22 “US has no choice but to work with Pakistan, says envoy Anwar Iqbal”, Dawn, 17 February 2022. https://www.dawn.com/news/1675518. 23 Aizaz Ahmad Chaudhry, “Delicate balancing act”, Dawn, 22 February 2022. https://www.dawn.com/news/1676409. 24 Kamran Yousaf, “Qureshi justifies PM’s Russia visit, says ‘diplomatic space’ increased”, The Express Tribune, 25 February 2022. https://tribune.com.pk/ story/2345268/qureshi-justifies-pms-russia-visit-says-diplomatic-spaceincreased. 25 Anwar Iqbal, “Pakistan still a strategic partner, reaffirms US”, Dawn, 4 February 2022. https://www.dawn.com/news/1673142. 26 Aizaz Ahmad Chaudhry, “Delicate balancing act”, op. cit. 27 Riaz Mohammad Khan, “Pakistan China relations: An overview Pakistan”, Pakistan Horizon, Pakistan Institute of International Affairs. https://www. jstor.org/stable/24711187.

© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_0008

Chapter 8

Competing for Influence: China and India in Post-COVID-19 Sri Lanka Chulanee Attanayake

Summary The COVID-19 global pandemic, described as the most significant public health challenge of this generation, has had an extremely adverse impact on Sri Lanka, bringing numerous challenges, including rising poverty rates, low socio-economic conditions, and unstable and volatile political conditions. It has put the country’s health service under tremendous pressure and brought the economy virtually to its knees. The economy, which was growing under three percent in 2019, was already in dire condition and now faced fiscal deficits, declining foreign exchange reserves and a ballooning debt. As a result, inflation rose to an all-time high leading to shortages in food and essentials. The pandemic’s unpredictable nature and the challenges facing Sri Lanka have forced Colombo to seek external assistance. While India was the first respondent to South Asia’s pandemic crisis, New Delhi’s struggle in managing the pandemic has provided the opportunity for China to emerge as the saviour. This chapter explores how the pandemic has provided the opportunity to both India and China to further continue their competition for influence on the tiny island state in a post-COVID-19 situation.

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Introduction The COVID-19 global pandemic has posed unprecedented challenges to public health, food supply systems and employment and has caused a dramatic loss of human life and devastating disruptions to economies and societies worldwide. In October 2020, the World Health Organization (WHO) predicted that tens of millions of people would fall into extreme poverty. The global number of undernourished people, estimated at nearly 690 million, would increase by 132 million due to the pandemic.1 The World Bank noted that in 2021, about 97 million people would be victims of COVID-19-induced poverty, increasing the global poverty rate from 7.8 to 9.1 percent.2 In South Asia, the number of poor was estimated to increase by 15 percent or 42 million people. That half of the additional extreme poor in the world are located in the region.3 Millions of enterprises and businesses were also predicted to face an existential threat. Half of the world’s global workforce would lose their livelihoods. Sri Lanka has not been exempted from this reality caused by the outbreak of COVID-19. The island has been significantly impacted by the outbreak and has resulted in it facing a range of challenges, including rising poverty rates, low socio-economic conditions, and unstable and volatile political conditions. Despite its considerably advanced public health system, Sri Lanka was severely affected by the COVID-19 pandemic. The island was under-resourced to face a global pandemic of this calibre. As of 2017, Sri Lanka had 492 intensive care unit (ICU) beds and 2.42 beds per 100,000 population. This figure is at the lower end of the international standard, which requires 1–30 ICU beds per 100,000 people. The patient to medical officer ratio in intensive care was 3.30–4.24 in different hospitals, and the ICU resident/patient ratio was 1:5.4 These figures indicate a relative lack of capacity in the country’s healthcare sector to deal with a significant health crisis, as it could only accommodate around 2,000 COVID-19 patients at one time. Additionally, Sri Lanka’s economy was in dire condition due to low growth averaging under three percent, high public debt nearing 90 percent of gross domestic product (GDP) and large fiscal deficits of nearly seven percent of GDP as of the end of 2019. With foreign exchange earnings declining due to the dip in tourism and foreign remittance revenues and



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the downgrading by credit agencies, the country is facing a severe food emergency. The pandemic’s unpredictable nature and challenges called Sri Lanka to seek external assistance. However, the pandemic is not simply a health tragedy or an economic problem. The response to and management of the pandemic has also been mired in politics. At the domestic level, political decision-making has either stressed or helped to improve the outbreak management — the reaction and responses of some countries were better than others.5 Internationally, the challenges called for coordinated efforts from the different countries, including sharing resources and expertise and providing support in fulfilling much-needed health infrastructure. The pandemic’s unpredictable nature and challenges have resulted in the smaller countries seeking external assistance. While India was the first respondent to calls for assistance from the South Asian states, New Delhi’s own struggle in managing the pandemic has provided the platform for China to lend support and present itself as a saviour and friend of Sri Lanka in time of need.

China and India’s Pandemic Diplomacy Emerging as a provider of public goods to the international community is an integral part of a country’s ascent to global leadership. For many years, both India and China have presented themselves as public good providers for the developing nations and contributed healthcare, technical support and education to the neighbourhood. When the pandemic broke out, New Delhi and Beijing used the opportunity to enhance their role as public goods and services providers. India was the first respondent to the South Asian region. Prior to the pandemic, India had emerged to become a significant provider of public goods and services to its immediate neighbourhood in areas such as healthcare, education, training, and scientific and technical support.6 Emphasising the ‘Neighbourhood First’ policy, India adopted a twopronged approach — multilateral and bilateral engagements. It reactivated the South Asian Association for Regional Cooperation (SAARC) as a forum to formulate a regional action plan to combat the pandemic. In this regard, Prime Minister Narendra Modi called on the SAARC leaders to strategise to fight the COVID-19 threat jointly and initiated discussion via

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video conferencing.7 Addressing the first video conference on 15 March 2020, Modi established a joint SAARC Fund to combat the pandemic by committing US$10 million (S$13.99 million).8 Following this, the other member states, sans Pakistan, directly pledged their contributions to the SAARC Fund to fight the pandemic. Sri Lanka contributed US$5 million (S$6.99 million), Bhutan US$100,000 (S$139,957), Bangladesh US$1.5 million (S$2.09 million) and the Maldives US$200,000 (S$279, 913). Pakistan’s US$3 million (S$4.19 million) contribution was placed with the SAARC Secretariat.9 India later sent US$1.7 million (S$2.38 million) worth of medical equipment to Afghanistan, Bhutan, Bangladesh, Nepal, the Maldives and Sri Lanka from the contribution it pledged to the fund.10 New Delhi capitalised on its position as a major global pharmaceutical and medical product manufacturer and offered humanitarian assistance to its neighbours. Its bilateral diplomacy saw it supplying test kits and medical equipment and essential medicines such as paracetamol and hydroxychloroquine (HCQ) and medical supplies, including surgical masks and head caps, sterile surgical latex gloves and ventilators to countries in the region. It also sent rapid action teams consisting of medical professionals to assist its neighbours as first responders. Between March 2020 and May 2020, India sent three consignments of essential medical supplies to Bangladesh.11 It supplied 320,000 dosages of paracetamol and 250,000 dosages of HCQ, test kits and other medical supplies to Nepal. In May 2020, New Delhi sent another consignment of 30,000 polymerase chain reaction (PCR) kits and 28 ICU ventilators to Nepal. Soon after the AstraZeneca vaccine, jointly developed with Serum Institute of India, came into the market, India provided consignments through grant-in-aid to its neighbours.12 Bhutan received 150,000 doses four days after India kick-started its vaccination programme on 15 January 2021. Bangladesh received two million doses; Nepal one million doses; the Maldives 100,000 doses and Sri Lanka 500,000 doses. China’s role as a global public goods and services provider during the pandemic was no different from that of India. Despite its own domestic health crisis, China initiated multinational cooperation to contain the pandemic in other countries. Apart from calling for and pledging joint efforts, Beijing conducted more than 70 exchanges with international and regional organisations and provided humanitarian assistance to the international community as part of its ‘Global Community of Health for All’ initiative.13 As of 31 May 2020, China had



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sent medical expert teams to 27 countries and aided 150 countries. Between March 2020 and May 2020, alone, China exported protective materials, including 70.6 billion masks, 340 million protective suits, 115 million pairs of goggles, 96,700 ventilators, 225 million test kits and 40.29 million infrared thermometers to 150 countries. China offered its assistance to South Asia as soon as the pandemic broke out. As early as February 2020, China sent its first batch of 500 PCR kits and provided emergency anti-epidemic medical supplies to Bangladesh. In June 2020, Beijing sent a medical experts’ team to facilitate Dhaka’s fight against the pandemic.14 According to Global Times, China and Bangladesh also discussed vaccine research and development cooperation technical details.15 China sent a flight full of essential medical supplies to Pakistan on 28 March 2020.16 It separately provided medical supplies to Gilgit Baltistan at the request of its local government.17 China also assisted the South Asian countries in addressing their economic concerns. Amidst the World Bank’s prediction of negative growth for the region and amidst the debt crisis and depleting foreign reserves of countries like Pakistan and Sri Lanka, China offered financial aid to the South Asian countries. Pakistan was offered a US$1.5 billion (S$2.09 billion) financing line to repay its debt to Saudi Arabia. To construct the Main Line (ML-1) project, China provided Pakistan with US$6 billion (S$8.3 billion) in loans as part of the China–Pakistan Economic Corridor (CPEC). In May and August 2020, the China-backed Asian Infrastructure Investment Bank approved a US$250 million (S$349.9 million) loan and another US$100 million (S$139.9 million) to Bangladesh to help counter the pandemic. Dhaka was further offered a loan of $1 billion (S$1.39 billion) for the Teesta river management project. In June 2020, Bangladesh and China signed a duty-free agreement, announcing that 97 percent of Bangladesh’s products will enjoy duty-free access to the Chinese market. China was the main supplier of the COVID-19 vaccines for most of the developing countries.18 As of May 2022, China sold an estimated 1.9 billion doses and donated 242 million doses19 of the vaccine across 118 countries.20 While Bangladesh (95 million) is among its top buyers of the vaccine, Sri Lanka (five million), Nepal (12.4 million) and Bangladesh (5.6 million) are among the top recipients of the vaccine donations. China has delivered a total of 112.43 million doses to Pakistan, 1.7 million doses to Afghanistan and 50,000 doses to Bhutan.21

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It is interesting to note that China has been able to gain momentum in its vaccine diplomacy in South Asia at the expense of India which halted vaccine exports on 26 April 2021 due to shortages for local needs. In the wake of the new wave of the pandemic and the shortage of vaccines, the smaller South Asian states have turned to China to secure doses to accelerate their vaccination programmes. In addition, WHO’s approval for the China-produced Sinopharm vaccine has increased its demand from these countries.

China’s Efforts to Influence Sri Lanka Being one of Sri Lanka’s closest partners, China has continued its humanitarian and developmental assistance to Sri Lanka since the outbreak of the pandemic. Between March and June 2020, China sent three batches of essential medical supplies and protective equipment to Sri Lanka.22 The first batch of medical donations in April 2020 included 50,000 masks and 1,008 diagnostic kits.23 Later, another 20,000 diagnostic kits, 10,000 personal protective equipment (PPE) and 110,000 masks were donated to Colombo.24 In June 2020, more diagnostic kits, PPE, face shields and goggles, protective gowns and masks were given to Sri Lanka’s first respondents.25 In response to India’s initiative of the SAARC virtual summit, China held several of its own virtual dialogues with the South Asian countries between July 2020 and January 2021, focusing on taking forward closer cooperation on fighting coronavirus. While Pakistan and Nepal participated in all three virtual meetings convened by China, Bangladesh and Sri Lanka participated in two meetings while India, Bhutan and the Maldives were exempted from these meetings. In the meetings with Afghanistan, Nepal and Pakistan, China proposed to expand the CPEC to Afghanistan and proposed a plan to jointly build the Trans-Himalayan Economic Corridor with Nepal. In one of the meetings, China announced the establishment of a China–South Asian Countries Emergency Supplies Reserve and a China–South Asia Poverty Alleviation and Cooperative Development Center as well as hold a China–South Asia E-commerce Cooperation Forum on Poverty Alleviation in Rural Areas. The participating foreign ministers agreed to institutionalise the cooperation among the six countries, hold regular consultations and expand the areas of cooperation.



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During the fourth meeting in April 2021, after the severe second COVID-19 wave hit the South Asian region, China expressed its desire to help India tackle the situation. Chinese Ambassador to India, Sun Weidong, said China supplied more than 5,000 ventilators, 21,569 oxygen generators, 21.48 million masks and around 3,800 tonnes of medicines to India.26 Chinese vaccine was also key in lessening Sri Lanka’s COVID-19 burden. Beijing provided 26 million vaccine doses, of which five million were donations.27 The Sinopharm vaccine helped Sri Lanka resume the vaccination programme effectively while there were delays in the despatch of the AstraZeneca vaccine from India.28 As Sri Lanka’s long-term economic and development partner, Beijing’s assistance to the declining economy amidst the pandemic was noteworthy. In March 2020, China offered Sri Lanka a concessional loan of US$500 million (S$699.7 million) and another US$90 million (S$125 million) grant in September 2020. In March 2021, China approved a US$1.54 billion (S$2.15 billion) currency swap deal with Sri Lanka to help promote trade and investment and ease its fiscal distress. A month later, China Development Bank extended a US$500 million (S$699.7 million) loan to Sri Lanka to improve foreign exchange. As the economic crisis in Sri Lanka worsened, Colombo sought China’s assistance for emergency support and debt restructuring.29 In March 2022, Sri Lanka sought a US$2.5 billion (S$3.49 billion) loan and credit line from China.30 In response, China offered an urgent emergency humanitarian aid of around US$31 million (S$43.38 million), which included 5,000 tonnes of rice, pharmaceuticals, production materials and other essentials.31 Having said that, China’s lukewarm response to Sri Lanka’s calls for debt restructuring is noteworthy. In January 2022, during the visit of Chinese Foreign Minister Wang Yi, President Gotabaya Rajapaksa requested for debt restructuring and concessional credit facility for the imports of essentials, which received no immediate response from the Chinese.32 Later, China stated its interest in offering a new loan to settle the debt instead of the proposed debt restructuring proposed by Sri Lanka’s government.33 While India has been active in offering credit lines and financial support for Sri Lanka as its economic crisis deepened, China has been mulling over the credit line requests from Colombo.34 Beijing’s lukewarm response is perhaps a reflection of the difficulties faced by its bilateral relations with Colombo in 2021. Sri Lanka and China’s relations experienced some vicissitude during the year. While the beginning of the year brought positive developments with the visit of the

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Chinese defence minister,35 diplomatic tension was caused when the Sri Lankan High Court issued an order preventing the state-owned bank from making any payment to the Chinese company, Qingdao Seawin Biotech Group, due to the National Plant Quarantine Service finding contaminated living organisms in organic fertiliser supplied by the Chinese company.36 In retaliation, the Chinese embassy in Sri Lanka called for an international inspection of the shipment.37 The Sri Lankan bank was blacklisted in China.38 A few months later, a Chinese firm that had won a bid to execute a solar power project was forced to suspend it due to India’s opposition.39 Since Gotabaya came into power in November 2019, no major project commenced with funding from China. While China was roped into constructing the East Container Terminal of the Colombo Port in November 2021,40 many constructions, including the port city and expressways, halted.41 Even though this was partly attributed to the disruptions during the pandemic, whether there is more to the issue is not clear. In the run-up to his first visit abroad after winning the elections in 2019 and while in New Delhi, Gotabaya made it clear that he would be mindful of India’s security concerns in relation to Colombo’s ties with Beijing,42 and his government proved this with action. In response, the visiting Chinese foreign minister emphasised that third parties should not get involved in bilateral relations between China and Sri Lanka.43 Sri Lankan Ambassador to China, Palitha Kohona, also reiterated that Colombo should not take its ties with China for granted and should make efforts to develop the relationship.44

India’s Efforts of Influence in Sri Lanka Being Sri Lanka’s closest neighbour, India was the first to respond to Sri Lanka’s humanitarian needs during the pandemic. It provided four consignments of medical essentials to Sri Lanka, including 13 tonnes of essential life-saving medicines in April 202045 and another 12.5 tonnes of medicines and equipment in May 2020.46 This assistance continued in the following two years. In September 2021, India provided 150 tonnes of oxygen and 100,000 antigen rapid test kits to the island nation in February 2022. Moreover, Sri Lanka was among the early recipients of the AstraZeneca vaccine in May 2020. Even though the vaccine delivery was delayed when India’s domestic demand surged due to rising COVID-19 cases, Sri Lanka placed an order for 13.5 million AstraZeneca doses in February



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2021.47 The humanitarian effort is commendable, for New Delhi was among the world’s most affected countries by the pandemic. As of June 2022, India had the second-highest number of confirmed cases globally (after the United States [US]) and the third-highest number of COVID-19 deaths (after the US and Brazil).48 However, it is also noteworthy that India has been more active as an economic and development partner to Sri Lanka throughout the pandemic. While existing projects with China were halted during the pandemic, India managed to bag some notable development projects in the same period. Adani Group’s investment in the Colombo port is an example.49 After a series of dramatic events for over two years, in September 2021, Adani Group became the first Indian port operator in Sri Lanka after signing an agreement with Sri Lanka’s largest listed company, John Keells Holdings, and the Sri Lankan Ports Authority to jointly develop the Colombo West International Container Terminal through a ‘Build Operate Transfer’ arrangement. It was considered a game-changer, both commercially and strategically, for India. Amidst growing Chinese influence in Sri Lanka’s port industry and China’s involvement in building Hambantota Port and later operating it, India was wary of the growing Chinese influence in Sri Lanka. Thus, the Adani investment was considered an opportunity with significant economic and strategic advantages. The Western Container Terminal is situated next to the Colombo International Container Terminals (CICT), signalling that India will be watching Chinese activities in the CICT from a close distance. Interestingly, India also managed to reverse projects awarded to Chinese firms. After China had to back down from building solar power project in the northern islands in Sri Lanka due to security concerns raised by a third-party (notably India),50 New Delhi signed a deal to build a hybrid power project,51 most probably in the same islands China had plans to build the solar power plant. These developments show how India has successfully countered China’s growing presence in the island nation in the post-COVID-19 period. India’s increasing role in and engagement with the island state is further evident in the face of Sri Lanka’s worsening economic crisis. Sri Lanka is facing its worst economic meltdown since its independence in 1948. With a year-high balance of payment and foreign exchange deficits, the long-term dual deficit problem has finally caught up with the Sri Lankan economy. Gotabaya’s misplaced policies, economic distress caused by the COVID-19 pandemic and the Russia–Ukraine war further

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exacerbated Sri Lanka’s declining economic situation. India came forward as an essential partner in assisting Sri Lanka during this period. In January 2022, New Delhi extended a US$400 million (S$559 million) currency swap under the SAARC framework and deferred an Asian Clearing Union settlement of US$515.2 million (S$719.2 million) until 6 May 2022. It was followed by a line of credit of US$500 million (S$698 million) for the import of fuel and a further credit facility of US$1 billion (S$1.39 billion) for the procurement of food, medicine and other essentials.52 New Delhi’s assistance has extended beyond providing credits. It has also actively supported Colombo diplomatically. For instance, during the International Monetary Fund’s deliberations for assistance to Sri Lanka in April 2022, Indian Finance Minister Nirmala Sitharaman urged the international agencies to temporarily classify the island as a lower-income country — from the current middle-income status — to ease the process of debt restructuring and gaining urgent financial assistance.53 India’s active support and increasing engagement with Sri Lanka can be understood within the changing geopolitics in the region. New Delhi believes that China is cultivating strategic relations with Sri Lanka and the other South Asian countries to encircle India. India has been vocal of every activity in Sri Lanka involving China — be it with China building and running the Hambantota Port or Chinese submarines docking at Colombo port. Additionally, to enhance its own position in Sri Lanka, India has increased its development assistance to and investments in Sri Lanka. India has likely realised that continuous engagement and assistance during the crisis would ensure its strong foothold in the island nation. It is often pointed out that India’s response to Sri Lanka’s diplomatic crisis soon after the end of the civil war in 2009 allowed China to establish its foothold in the island nation.

Conclusion As a small country situated in a strategic location and caught in the middle of power competition, Sri Lanka experiences both the benefits and challenges of the Sino-Indian rivalry. Even though Sri Lanka, as a small state, is expected to ally itself decisively with one power or the other, to its credit, it has learned how to turn the rivalry into an opportunity to realise its own vested interests without aligning with a single power. It has



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seized upon an alliance strategy described as ‘hedging’,54 — hedging its bets with both and has turned their rivalry into its advantage. Colombo has benefitted economically and strategically from this manoeuvring most of the time. However, it does not mean that Colombo has not been dragged into the rivalry between India and China. Successive Sri Lankan governments have continued to affirm that Sri Lanka is in no position to choose its partners but is instead ready to work with all countries, including India and China, to achieve its development targets. While Sri Lanka pays attention to India’s sensitivities vis-à-vis China, it is open about accepting investments from Beijing. Colombo’s relationship with India and China, amidst their power rivalry, highlights that small states can play a role in determining the nature of their alliances, despite being at a disadvantage relative to the larger powers.

Endnotes  1 “Impact of COVID-19 on people’s livelihoods, their health and our food systems”, World Health Organization, 13 October 2020. https://www.who. int/news/item/13-10-2020-impact-of-covid-19-on-people’s-livelihoodstheir-health-and-our-food-systems#:~:text=The%20economic%20and%20 social%20disruption,the%20end%20of%20the%20year.   2 Daniel Gerszon Mahler et al., “Updated estimates of the impact of COVID19 on global poverty: Turning the corner on the pandemic in 2021?” World Bank Blogs, World Bank 24 June 2021. https://blogs.worldbank.org/ opendata/updated-estimates-impact-covid-19-global-poverty-turningcorner-pandemic-2021.   3 Andy Sumner, Eduardo Ortiz-Juarez and Chris Hoy, “Precarity and the pandemic: COVID-19 and poverty incidence, intensity, and severity in developing countries” (United Nations University World Institute for Development Economics Research, June 2020).   4 V. Pinto, R. Amarasena, B. Kudavidanage, A. Goonarathne, V. Senanayake, B. Sandeepani and C. Rathnayake, Province Population Number of ICUs Critical Care in Sri Lanka, n.d., https://criticalcare.lk/wp-content/ uploads/2019/04/SLMA-publication-edited-for-word-count-1.pdf.   5 Sara E. Davies and Clare Wenham, “Why the COVID-19 response needs International Relations”, International Affairs, 96(5), 2020, 1227–1251. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7797718/.   6 Smruti S. Pattanaik, “COVID-19 pandemic and India’s regional diplomacy”, South Asian Survey, 28(1), 2021, 92–110. https://journals.sagepub.com/doi/ full/10.1177/0971523121999293.

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 7 Kallol Bhattacherjee, “Modi calls on SAARC to fight coronavirus”, The Hindu, 13 March 2020. https://www.thehindu.com/news/national/modicalls-on-saarc-to-fight-coronavirus/article31059135.ece.   8 “Coronavirus: Prime Minister Modi calls for COVID-19 emergency fund for SAARC”, The Hindu, 15 March 2020. https://www.thehindu.com/news/ national/coronavirus-pm-modi-participates-in-saarc-videoconference-to-formulate-joint-strategy-to-combat-covid-19/article31074653.ece.   9 Pattanaik, “COVID-19 pandemic and India’s regional diplomacy”, op. cit. 10 Shishir Gupta, “Imran Khan hits mute on Saarc COVID-19 pledge, India sends $1.7 mn relief ”, Hindustan Times, 17 April 2020. https://www. hindustantimes.com/india-news/india-spends-1-7-million-from-saarccovid-19-fund-imran-khan-is-again-awol/story-A7zuJGOQeRb91uJ phN4ESM.html. See also Shishir Gupta, “India uses Saarc Covid Fund for HCQ tablets to neighbours. Afghanistan next”, Hindustan Times, 15 April 2020. https://www.hindustantimes.com/india-news/india-to-send-5-lakhhcq-tablets-to-afghanistan-from-saarc-covid-19-fund/story-4SLfVrVI0QEsbWavZM6tqN.html. 11 “India hands over 3rd tranche of emergency medical assistance to Bangladesh”, All India Radio, 6 May 2020. http://newsonair.com/News? title=India-hands-over-3rdtranche-of-emergency-medical-assistance-toBangladesh&id=387817. 12 Ramita Iyer and Karthik Nachiappan, “India’s vaccine diplomacy”, ISAS Brief No 820, Institute of South Asian Studies, National University of Singapore, 28 January 2021. https://www.isas.nus.edu.sg/papers/indiasvaccine-diplomacy/. 13 “Fighting COVID-19: China in action”, Xinhua Net, 7 June 2020. http:// www.xinhuanet.com/english/2020-06/07/c_139120424.htm. 14 “Chinese medical expert team arrives in Bangladesh to help fight COVID19”, Xinhua Net, 8 June 2020. http://www.xinhuanet.com/english/202006/08/c_139124099.htm. 15 Jiming Li, “China and Bangladesh create a new chapter in the fight against COVID-19 — Global Times”, Global Times, 10 August 2020. https://www. globaltimes.cn/content/1197279.shtml. 16 “China sends medical aid to Pakistan to combat coronavirus outbreak”, The Hindu, 28 March 2020. https://www.thehindu.com/news/international/ china-sends-medical-aid-to-pakistan-to-combat-coronavirus-outbreak/­ article31194861.ece.



China and India in Post-COVID-19 Sri Lanka    89

17 “Chinese medical donations to Pakistan save lives, help frontline fighters against COVID-19”, Global Times, 19 May 2020. https://www.globaltimes. cn/content/1188783.shtml. 18 Josephine Ma, “China was the world’s biggest COVID-19 vaccine exporter. Not any more”, South China Morning Post, 14 April 2022. https://www. scmp.com/news/china/diplomacy/article/3174162/china-was-worldsbiggest-covid-19-vaccine-exporter-not-any. 19 “China COVID-19 vaccine tracker”, Bridge Beijing Consulting, 5 March 2021. https://bridgebeijing.com/our-publications/our-publications-1/ china-covid-19-vaccines-tracker/. 20 “Tracking China’s COVID-19 vaccine distribution”, Bridge Beijing Consulting, 5 March 2021. https://bridgebeijing.com/our-publications/our-publications-1/ china-covid-19-vaccines-tracker/#China8217s_Vaccines_Around_the_World. 21 Ibid. 22 “China donates 3rd batch of medical aid to Sri Lanka”, Xinhua Net, 25 June 2020. http://www.xinhuanet.com/english/2020-06/25/c_139164738.htm. 23 “Sri Lanka received the first batch of medical supplies donated by Chinese government”, Ministry of Foreign Affairs, China, 2 April 2020. https://www. mfa.gov.cn/ce/celk//eng/xwdt/t1765094.htm. 24 “Timely medical aid from China helps Sri Lanka amidst COVID-19 escalation”, China International Development Corporation Agency, 28 April 2020. http://en.cidca.gov.cn/2020-04/28/c_481819.htm. 25 “China donates 3rd batch of medical aid to Sri Lanka”, Xinhua Net, 25 June 2020. http://www.xinhuanet.com/english/2020-06/25/c_139164738.htm. 26 Sun Weidong’s Tweet, 29 April 2021. https://twitter.com/China_Amb_India/ status/1387749725177143302. 27 “Tracking China’s COVID-19 vaccine distribution: China’s vaccines in Asia”, op. cit. 28 Suranjana Tewari, “Sri Lanka: Covid increases China influence in India’s backyard”, BBC News, 20 May 2021. sec. Asia, https://www.bbc.com/news/ world-asia-57167091. 29 Rohini Mohan, “Sri Lanka’s President asks China for help amid its worst financial crisis”, The Strait Times, 9 January 2022. https://www.straitstimes.com/asia/ south-asia/sri-lankas-president-asks-china-to-restructure-debt-repayments. 30 “Sri Lankan envoy confident China will provide debt relief”, The Straits Times, 12 April 2022. https://www.straitstimes.com/asia/south-asia/ sri-lankan-envoy-confident-china-will-provide-debt-relief. 31 Rohini Mohan, “China offers $42.4 million in aid to crisis-hit Sri Lanka”, The Straits Times, 22 April 2022. https://www.straitstimes.com/asia/southasia/china-offers-s424-million-in-aid-to-crisis-hit-sri-lanka.

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32 Krishan Francis, “Sri Lanka seeks Chinese debt restructuring amid crisis”, AP News, 9 January 2022. https://apnews.com/article/business-chinabeijing-sri-lanka-africa-e6b1e60b2a1aab035bcc6e65ebe507b7. 33 Krishan Francis, “Sri Lanka, China discusses loan from Beijing to cover debts”, ABC News, 26 April 2022. https://abcnews.go.com/International/ wireStory/sri-lanka-discusses-loan-china-cover-earlier-debts-84311351. 34 Bharatha Mallawarachchi, “China mulls package to ease Sri Lanka’s economic crisis”, AP News, 21 March 2022. https://apnews.com/article/ business-china-beijing-sri-lanka-228d0d620d1a5e048021a9919909b0ac. 35 “Timely medical aid from China helps Sri Lanka amidst COVID-19 escalation”, op. cit. 36 Chulanee Attanayake, “Sri Lanka-China organic fertiliser spat: Reflections”, ISAS Brief No 886, Institute of South Asian Studies, National University of Singapore, 27 December 2021. https://www.isas.nus.edu.sg/papers/ sri-lanka-china-organic-fertiliser-spat-reflections/. 37 “Chinese embassy plays hardball over payments for contaminated fertiliser”, The Sunday Times, 31 October 2021. https://www.sundaytimes.lk/211031/ business-times/chinese-embassy-plays-hardball-over-payments-for-contaminatedfertilizer-459972.html. 38 “China blacklists Sri Lanka’s state-owned bank for refusing payments for canceled fertiliser deal”, South Asia Monitor, 29 October 2021. https://www. southasiamonitor.org/china-watch/china-blacklists-sri-lankas-state-ownedbank-refusing-payments-canceled-fertilizer-deal. 39 Meera Srinivasan, “China firm slams ‘Third-Party’ interference in Lanka project”, The Hindu, 22 February 2021. https://www.thehindu.com/news/ international/china-firm-slams-third-party-interference-in-lanka-project/ article33906958.ece. 40 “Chinese firm gets contract to develop Colombo port’s controversial Eastern container terminal”, The Indian Express, 24 November 2021. https:// indianexpress.com/article/world/chinese-firm-contract-to-develop-colomboport-terminal-7639883/. 41 Chanaka Jayasinghe, “Coronavirus stalls construction projects in Sri Lanka”, EconomyNext, 11 February 2020. https://economynext.com/coronavirusstalls-construction-projects-in-sri-lanka-49226/. 42 Meera Srinivasan, “Sri Lanka won’t do anything that will harm India’s interests: Gotabaya Rajapaksa”, The Hindu, 25 November 2019. https://www. thehindu.com/news/international/sri-lanka-wont-do-anything-that-willharm-indias-interests-rajapaksa/article30077067.ece. 43 Meera Srinivasan, “No ‘Third Party’ should interfere in China’s Sri Lanka ties: Wang Yi”, The Hindu, 10 January 2022. https://www.thehindu.com/ news/international/no-third-party-should-interfere-in-chinas-sri-lanka-tieswang-yi/article38217745.ece.



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44 “Sri Lanka’s foreign policy: Government needs to pay more attention to China: Palitha Kohona”, The Morning, 26 February 2022. https://www. themorning.lk/sri-lankas-foreign-policy-government-needs-to-pay-moreattention-to-china-palitha-kohona/. 45 “India gifts consignment of medical gloves to Sri Lanka”, News.lk, 28 April 2020. https://www.news.lk/news/political-current-affairs/item/30051-indiagifts-consignment-of-medical-gloves-to-sri-lanka. 46 Meera Srinivasan, “Coronavirus | India sends essential medicines to Colombo”, The Hindu, 8 May 2020. https://www.thehindu.com/news/ international/coronavirus-india-sends-essential-medicines-to-colombo/ article31537671.ece. 47 “Sri Lanka orders 13.5 million AstraZeneca doses, likely to drop Chinese COVID-19 vaccines”, The Hindu, 23 February 2021. https://www.thehindu. com/news/international/sri-lanka-orders-135-million-astrazeneca-doseslikely-to-drop-chinese-covid-19-vaccines/article33913670.ece. 48 Max Roser and Hannah Ritchie, “Coronavirus Disease (COVID-19)”, Our World in Data, 4 March 2020. https://ourworldindata.org/coronavirus. 49 Chulanee Attanayake, “India’s answer to China’s ports in Sri Lanka”, The Interpreter, Lowy Institute, 9 November 2021. https://www.lowyinstitute. org/the-interpreter/india-s-answer-china-s-ports-sri-lanka. 50 “China suspends Sri Lanka energy project over security concerns”, Business Standard, 3 December 2021. https://www.business-standard.com/article/ international/china-­suspends-sri-lanka-energy-project-over-security-concerns121120300434_1.html. 51 Krishan Francis, “India plans Sri Lanka power project after China’s is shelved”, AP News, 29 March 2022. https://apnews.com/article/ business-china-environment-india-sri-lanka-18ddb1b013aa7d18bccdf5a 3f9aa40e8. 52 “Colombo needs more, India may up aid by $2 Billion”, The Indian Express, 14 April 2022. https://indianexpress.com/article/business/economy/sri-lankaconvoy-meeting-colombo-needs-more-india-may-up-aid-by-2-bn-7868324/. 53 Arup Roychoudhury, “FM Sitharaman asks IMF, World Bank to give Sri Lanka low-income tag”, Business Standard, 24 April 2022. https://www. business-standard.com/article/international/fm-sitharaman-asks-imf-worldbank-to-give-sri-lanka-low-income-tag-122042401044_1.html. 54 Polly Diven, “Superpowers and small states: US, China, and India vie for influence in Sri Lanka”, Annual Meeting of the European Consortium on Political Research, Prague, 7–10 September 2016, pp. 7–10. https://paperzz. com/doc/7872194/superpowers-and-small-states--u.s.--china--andindia-vie-for.

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© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_0009

Chapter 9

China: Exploring Certainties in Uncertain Sino-Indian Relations Zheng Haiqi

Summary After decades of steady development, China–India relations are currently at a low point due to their border disputes. Unlike India and the Western countries, China has a systematic assessment of the current and future Sino-Indian relations. Beijing has two basic interests in its bilateral relations with India — prioritise the development of these relations and maintain economic and trade ties. As nuclear powers and close neighbours, there will be no real war between China and India. Even on border issues, China and India recognise the need to maintain stability and exclude third-party intervention. However, China’s primary concern is that India’s growing strategic relations with the United States (US) will put more pressure on its security. At the same time, the promotion of the Belt and Road Initiative (BRI) in South Asia has also encountered strong resistance and countermeasures from India, resulting in fierce geopolitical competition between them. Looking ahead, issue-based discussion and coordination may be an appropriate way to improve bilateral relations between Beijing and New Delhi. The two powers can cooperate on specific issues for functional benefits without changing their broader policy imperatives and directions. 93

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Introduction Soon after its independence, China built diplomatic relations with India in 1950. India was one of the first few countries to recognise the newly created People’s Republic of China. However, the Sino-Indian War in 1962 brought the bilateral relationship to a low point. Thereafter, both countries made considerable efforts to rebuild their relations. During the first decade of the 21st century, Sino-Indian relations rose to a high level, with frequent leader interactions and various agreements. Consequently, China defined India as its “strategic cooperative partner”, which was relatively significant for any country in China’s foreign policy framework. However, the good time did not last long. The disputed border area and negative historical memory caused by the 1962 war have always shadowed their bilateral relations. The Doklam standoff in 2017 and the Galwan Valley skirmishes in 2020 have greatly damaged the confidence between China and India. Bilateral relations have deteriorated rapidly since then. The Sino-Indian rivalry has clearly negated previous cooperation and could lead to dangerous dynamics between the two sides. Sino-Indian relations are indeed at a crossroads now. This chapter focuses on China’s perception of the Sino-Indian consensus and future challenges in its relations with India. It first briefly looks at Beijing’s political and economic interests in sustaining steady Sino-Indian relations. The discussion next explores China’s perception of the bilateral consensus and its measures to maintain it. The chapter then analyses China’s major concerns with the current Sino-Indian relations. The concluding section reflects on an issue-based coordination approach for the future development of Sino-Indian relations.

Beijing’s Interests in Sino-Indian Relations From Beijing’s perspective, healthy Sino-Indian relations are not only necessary for regional stability but also beneficial to China’s domestic development. Within Sino-Indian relations, Beijing has always had two main basic interests.

Pursuing Bilateral Relations After Indian Prime Minister Rajiv Gandhi’s visit to China in 1988, Sino-Indian relations entered a normalisation phase, which emphasised



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broader relations development and the setting aside of the border disputes. Decades of development once made China and India models for cooperation among the Asian great powers. The slogan of the ‘dragon and elephant tangoing together’ was used to describe their harmonious relations. However, Beijing had to face the harsh reality of not having cordial relations with India all the time. Nonetheless, it was more than willing to repair and resume bilateral relations rather than escalate tensions. Chinese officials and departments have avoided using the term ‘strategic rivalry’ to describe China’s relations with the other great powers, including India. Instead, Beijing has often labelled Sino-Indian relations as ‘interest disagreements’. Compared with the former term, ‘interest disagreements’ seem to be a normal phenomenon, which aims to lower Beijing’s competition intensity with New Delhi. China’s Ministry of Foreign Affairs and its officials have quite often highlighted to India that it would like to put bilateral relations first and prevent border-related incidents from causing unnecessary disruptions to the overall developments of their bilateral relations.1 The statements and speeches by Chinese officials clearly imply that Beijing’s attitudes towards New Delhi are softer and friendlier as compared with China’s attitudes towards the US. This is largely because Washington is Beijing’s key adversary, while New Delhi, whether subjectively or objectively, has not posed any major threat to Beijing. Sometimes, China even makes the effort to create conditions for the improvement of its relations with India. Despite a climate of tension and misunderstanding, Beijing provided New Delhi with oxygen machines and medical supplies rapidly when India suffered from the second wave of COVID-19 pandemic in 2021. However, Beijing’s position is contrary to that of New Delhi. Indian officials repeatedly stress that bilateral cooperation can only flourish through a resolution of the border issues and maintaining peace there. Persuading New Delhi to get back on track in their bilateral relations will be a big test for Beijing.

Consolidating Economic and Trade Ties Beijing’s preference to maintain cordial bilateral relations with New Delhi is based on the fact that both sides have the potential to advance their economic ties, in particular the rapid increase of bilateral trade volume between the two countries. Bilateral trade stood at only US$3 billion (S$4.2 billion) in 2000. Within two decades, bilateral trade witnessed significant growth, with China becoming India’s biggest trading partner

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for the first time in 2008. Although China has a huge trade surplus in their bilateral trade, India’s position in China’s economic story is still significant. In addition to providing China with raw materials, Indian pharmaceutical and drug exports have also occupied an essential part in the Chinese market. From China’s perspective, it is a long way from catching up with India’s success in developing drugs. Public opinions in China have called for greater access to Indian drugs and the central government has considered lowering the threshold. A famous Chinese movie, Dying to Survive, in 2018, has aroused strong public enthusiasm for generic drugs in India. During the Wuhan summit in 2018 and the Chennai summit a year later, the two leaders — Chinese President Xi Jinping and Indian Prime Minister Narendra Modi — agreed to push bilateral trade and investments forward. They called on both countries to focus on further deepening economic cooperation and enhancing development partnership. However, following the Galwan Valley skirmishes in 2020, New Delhi has been making efforts to decrease its economic dependence on China or even decouple from Beijing economically. Despite this, China continues to be an important trading partner for India. According to the statistics from the Chinese Ministry of Commerce, India–China trade grew to a record high of over US$125.6 billion (S$175.8 billion) in 2021 (see Table 1), an increase of 43 percent from 2020.2 The fact implies that their broader economic relations have not been severely impacted by their great power rivalry. According to a survey conducted by Global Times, 46.1 percent of the respondents still support future economic cooperation between China and India, despite a series of unfriendly measures taken by India.3 Instead of imposing reciprocal sanctions against India’s unfair economic and trade policies, Beijing has opted to focus on continued cooperation with New Delhi. Chinese South Asian studies expert, Long Xingchun, agreed that China wishes to not only push domestic growth but also to drive the overall development of Asia and would be happy to see India’s ­prosperity.4 China has always maintained the position that even if there are some contradictions between the two countries, they can still actively focus on economic cooperation. Beijing also firmly believes that India’s economic decoupling from China will result in practical challenges. Although India has been developing supply chain alliances with Japan and Australia, it would be difficult for India to reduce its supply chain dependence on China, at least

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Table 1:   China–India Bilateral Trade Volume, 2000–2021 (US$ trillion) Year

Total Trade Volume

Year-on-Year Growth (%)

Year

Total Trade Volume

2000

2.91

2001

3.60

2002 2003

Year-on-Year Growth (%)

46.6

2011

73.91

19.7

23

2012

66.47

–10.1

4.95

37

2013

65.40

–1.5

7.59

76

2014

71.60

8.6

2004

13.61

79

2015

71.62

1.4

2005

18.70

37.5

2016

70.15

–1.7

2006

24.86

32.9

2017

84.54

20.3

2007

38.62

55.4

2018

95.54

13.2

2008

51.84

34.2

2019

92.81

–2.8

2009

43.38

–16.3

2020

87.59

–5.6

2010

61.76

42.4

2021

125.60

43

Source: Trade data compiled from the Ministry of Commerce of the People’s Republic of China.

in the short term, considering the deep economic dependence and trade imbalance between the two powers. Simultaneously, India’s domestic protectionist tendencies will make it difficult for Western corporations and investments to access its market, which has proven a real obstacle in India’s free trade agreement pursuit. Beijing is, therefore, aware that it would be difficult for New Delhi to achieve ‘de-Sinification’.

Beijing’s Perception on Sino-Indian Consensus Beijing realises that there is a certain degree of consensus between China and India on several issues. First and foremost, the two powers will not fight a real war in the foreseeable future. As neighbouring states, China and India realise the danger and cost of such an action. With the COVID-19 pandemic still posing challenges to global economic recovery, both sides realise that their priorities should be on dealing with the pandemic and on economic recovery. India’s former National Security Advisor and former Foreign Secretary, Shivshankar Menon, asserted that Beijing and New Delhi have other preoccupations and should not want to be locked in a conflict. He added that India wants to transform itself into a great power, something that fighting with China will distract from and delay.5

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Both powers also fear the potential of facing pressures on two fronts if they have their own conflicts, namely, China with the US and India with Pakistan. This will put unwanted pressure on both countries’ resource allocation in two different theatres. In fact, the prospect of a conventional war between India and Pakistan seems greater than an India–China war. Even some Indian scholars have acknowledged that there is currently very little room for compromise between the two South Asian neighbours, with both circling the other warily. They know that an outright war with China is not possible.6 Both countries understand that in the event of a real war, as border-sharing neighbours, both would be hard hit. Their losses would obviously be greater than those of the US and its allies who will lend support from thousands of kilometres away. Therefore, both sides are conscious of border conflicts. Moreover, the fact that China and India are two nuclear powers has convinced Beijing’s policy analysts that a large-scale warfare would be implausible. Chinese strategists also believe that India lacks the will and military might to pick a fight with Beijing. As a result, they do not see India as a threat. Beijing believes that New Delhi developed nuclear weapons in pursuit of deterrence and international prestige, not to threaten China.7 Arzan Tarapore suggested that bolstering India’s defensive position is more likely than punishment to preserve crisis stability. India should accept more risks along the Line of Actual Control in exchange for long-term leverage and influence in the Indian Ocean region.8 Beijing and New Delhi share similar interests on global governance. As the two largest developing countries and emerging economies, China and India have similar views on reforming the Western-centred multilateral system. During the 2008 global financial crisis, China and India emerged to play a larger role in the global community, marking a strong presence of non-Western states in international institutions. A former Chinese senior official put forward the view that developing and emerging countries have an increasingly strong wish to participate in global governance.9 China–India cooperation is of symbolic and decisive significance for the emerging countries to play a larger role in global governance.10 Both sides have demonstrated the will to cooperate through the BRICS (Brazil, Russia, India, China and South Africa) New Delhi Declaration in 2021, which highlighted that strengthening and reforming the multilateral system is one of their pillars.11 From Beijing’s perspective, global governance has entered its Asia period, in which China and India are the two leading powers. The two



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countries have strengthened cooperation on a series of regional and global issues and have increased their ability and influence to formulate rules in established international institutions, aiming to improve their status and influence in a post-American world order.12 However, Harsh Pant has argued that China’s influence on global governance creates immense problems for India’s rise. China would use its growing influence to the detriment of other rising powers, which is evident in the debate over India’s access to the United Nations Security Council (UNSC) and the Nuclear Suppliers Group.13 Even on border issues, Beijing and New Delhi have a certain consensus, albeit limited. Even though both sides are concerned with border conflicts, they recognise the fact that this issue will endure in the long term and that stability needs to be maintained in the short term. Indian Ambassador to China, Vikram Misri, once said that the current issue is about restoring peace and tranquillity to the border areas rather than a resolution of the larger boundary question, which requires time to work through.14 In order to de-escalate the tensions, both powers have held several talks but have made limited progress after the Galwan Valley skirmishes. In September 2020, Chinese Foreign Minister, Wang Yi, and his Indian counterpart, S. Jaishankar, reached a five-point consensus to ease border tensions, which called for not allowing differences to become disputes and avoiding any action that could escalate matters.15 The two ministers also exchanged views at several other international meetings. Besides, senior military officials from both sides have held many rounds of talks, and some consensus was reached after some initial unsuccessful efforts. After the 14th round of China–India Corps Commander-level meeting in 2022, both sides issued a joint press release, agreeing to follow the guidance of the two countries’ leaders to resolve the remaining issues as soon as possible and to continue to maintain communications through military and diplomatic channels.16 In Beijing’s view, talking without concrete results is better than not talking at all. Moreover, both sides agree border issues are bilateral, excluding the possibility of third-party interference. As a matter of principle, India is opposed to foreign interference in its bilateral disputes with China. In May 2020, when the India–China conflict was at a tense level, the Modi administration rejected US President Donald Trump’s offer to mediate on the border standoff with China. New Delhi’s attitude aligned with Beijing’s expectation. China has always insisted that a third party, especially the US, should be excluded from the Sino-Indian border issue,

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which it feels will complicate and amplify the tensions along the border. New Delhi’s statement can be seen as a strategic guarantee for Beijing.

China’s Concerns over Uncertain Sino-Indian Relations Undoubtedly, Beijing is concerned with New Delhi’s strategic approach towards the US. Beijing once recognised that New Delhi opted for strategic autonomy and would keep a reasonable distance from the US in its foreign policy. At the Wuhan summit, both the Chinese and Indian leaders held the view that “China and India are important countries with strategic autonomy”.17 In some instances, New Delhi has rejected advice from Washington that Beijing regards as hostile, such as the joint patrol in the South China Sea. However, recent India–US dynamics have changed Beijing’s perception about India’s strategic autonomy. Currently, China firmly believes that India will not stand on its own as a strategic rival to China but will align with other powers in dealing with Beijing.18 After the Indo-Pacific Strategy was put forward in 2017, US–India defence security cooperation underwent dramatic enhancement, with the two sides signing the basic defence agreements, which American allies normally do. Indian scholars and retired officials have highlighted that India–US political and security congruence is growing based on a negative assessment of China’s recent behaviour. This congruence is only likely to increase in the coming decade.19 In the newly-released Indo-Pacific Strategy, the Joe Biden administration in the US views its support for India’s rise and regional leadership as one of the 10 action plans. Indian scholar Raja Mohan stated that “…official New Delhi has moved away from the legacy of anti-Americanism. The popular opinion… has been enthusiastic about the partnership with the US”.20 Deepening US–India strategic cooperation makes Beijing quite nervous and sensitive. A powerful neighbouring state joining in the US’ regional bloc will certainly put pressure on China. Beijing is also concerned about New Delhi’s consistent effort to counter the BRI in South Asia. When the BRI was launched, Chinese officials were keen for India to be a part of it. Beijing considered the extension of the China–Pakistan Economic Corridor (CPEC) to India and at the prospect of strategic docking with India’s Spice Route and Project Mausam. In 2015, India joined the China-backed Asian Infrastructure



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Investment Bank as a founding member, which made India’s participation in the BRI somewhat plausible. However, New Delhi decided that it would not participate in the BRI as the CPEC was a threat to India’s “…sovereignty as it passes through Pakistan-occupied Kashmir — Indian territory illegally occupied by Pakistan”.21 Furthermore, with China’s large-scale infrastructure investment in several of the South Asian countries, India has expressed its security concerns and is worried about the strategic encirclement by China. Recently, New Delhi launched several initiatives such as the SAGAR (Security and Growth for All in the Region) initiative and the Asia–Africa Growth Corridor, in response to Beijing’s encroachment in the Indian subcontinent. New Delhi aims to provide alternative infrastructure investments to the South Asian countries, as well as pressure its neighbouring states to keep their distance from China. India’s countermeasures have sparked fears in Beijing that these Indian efforts will lead to greater competition in infrastructure development in South Asia. Given India’s dominant position in South Asia and its influence among the neighbouring countries, China fears that its efforts to invest in South Asia would be increasingly difficult, and obstacles will be created to counter the progress of the BRI. It appears that New Delhi seeks to develop a complex web of sub-regional cooperation where India would play a critical role and serve as the ‘hub’ of these infrastructural connectivity projects.22 A well-known Chinese expert on South Asia, Hu Shisheng, put forward the view that the BRI in South Asia will face increasing strategic hedging from New Delhi, which will lead to intense geoeconomic competition between the two powers.23

A New Way for Sino-Indian Relations Faced with uncertain and unsteady relations, China and India must find appropriate ways to manage their disagreements and avoid further conflicts. Issue-based coordination could serve as an effective way to achieve this target. Issue-based coordination refers to functional and temporary coordination over specific common challenges. This approach is flexible so that a certain state is not tied to official commitments, which aligns with New Delhi’s strategic autonomy. Recently, India displayed open issue-based approach efforts, particularly in relation to being part of coalitions, for example, the

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Quadrilateral Security Dialogue (also called the Quad). In this respect, New Delhi was unwilling to join a military alliance — it asserted that the Quad was “…a plurilateral grouping delving into issues specific to the Indo-Pacific region”.24 It was more inclined to coordinate with the Quad partners (the US, Japan and Australia) on global and regional issues. Through an issue-based approach, New Delhi can not only avoid direct domestic criticism from getting too close to the US but also gain more functional benefits from these powers. Correspondingly, China is likely to accept this approach. Beijing has regarded the Sino-Indian relations as part of the great power equation, which needs to adapt to the competition and cooperation simultaneously. Beijing could seek cooperation with New Delhi on some issues while taking a hard stand on others, such as sovereignty. The same applies to India. In fact, both powers have adopted this approach in several instances. For example, from 2008 to 2013, Beijing and New Delhi coordinated their efforts to combat piracy in the Gulf of Aden, even though China’s warships deployment drew attention from Indian elites. Another example is climate change. At the COP26 summit in Glasgow in 2021, both China and India reached an agreement to “phase down” rather than “phase out” fossil fuels in the final text. As the two largest developing countries, China and India have similar views, positions and requirements on climate change, although they are still in a very difficult bilateral situation. During the 18th meeting of the foreign ministers of Russia, India and China in 2021, the parties agreed to strengthen the Russia–India–China trilateral cooperation, which could be an institutionalised platform for regional and global governance.25 China and India did not preclude the possibility of coordinated efforts against common challenges such as the COVID-19 pandemic and climate change. Following the Russian invasion of Ukraine in February 2022, both Beijing and New Delhi abstained during the UNSC resolution condemning the invasion and from the UN General Assembly vote to demand Russia’s withdrawal from Ukraine.

Conclusion The relationship between Beijing and New Delhi is such that there will be major and minor issues between them from time to time that will



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impact their relationship. However, despite the current less than friendly relationship between China and India, the two countries can still work together to tackle common challenges. In this respect, the two sides should focus on issue-based discussions and coordination to address these challenges. At the end of the day, the two sides may not necessarily change their broader policy imperatives and directions. However, they can certainly achieve functional benefits through such an approach.

Endnotes   1 “Border row must not be allowed to affect India ties, says China”, Times of India, 16 July 2021. https://timesofindia.indiatimes.com/india/border-rowmust-not-be-allowed-to-affect-india-ties-says-china/articleshow/84459425. cms.  2 “MOFCOM regular press conference”, Ministry of Commerce, People’s Republic of China, 17 February 2022. http://english.mofcom.gov.cn/article/ newsrelease/press/202202/20220203282576.shtml.   3 “Global Public Opinion Center released the investigation report on ‘SinoIndia Relations’”, Global Times, 31 August 2020. https://world.huanqiu. com/article/3zgipLTM3IW.   4 Long Xingchun, “China–India trade potential remains to be tapped”, Global Times, 10 February 2022. https://opinion.huanqiu.com/article/46knsjNCrAu.   5 Shivshankar Menon, “How India and China can keep the peace”, Foreign Affairs, 8 December 2021. https://www.foreignaffairs.com/articles/ china/2021-12-08/how-india-and-china-can-keep-peace.  6 Tara Kartha, “India and China share a grey relationship. It all hinges on ‘waiting for the right time’”. The Print, 7 February 2022. https://theprint.in/ opinion/india-and-china-share-a-grey-relationship-it-all-hinges-on-waitingfor-the-right-time/823411/.   7 Toby Dalton, Tong Zhao and Rukmani Gupta, “After the border clash, will China–India competition go nuclear”? Carnegie Endowment for International Peace, 29 October 2020. https://carnegieendowment.org/2020/10/29/ after-border-clash-will-china-india-competition-go-nuclear-pub-83072.   8 Arzan Tarapore, “The crisis after the crisis: How Ladakh will shape India’s competition with China”, Lowy Institute, May 2021. https://www.lowy institute.org/publications/crisis-after-crisis-how-ladakh-will-shape-india-scompetition-china.   9 Yu Hongjun, “Emerging countries like China and India can lead global governance”, Global Times, 2 June 2021. https://www.globaltimes.cn/ page/202106/1225180.shtml.

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10 Ibid. 11 “XIII BRICS summit- New Delhi declaration”, Ministry of External Affairs, Government of India, 9 September 2021. https://www.mea.gov.in/bilateraldocuments.htm?dtl/34236/XIII+BRICS+Summit+New+Delhi+Declaration. 12 Feng Liu, “China–India engagement in institutions: Convergence and divergence on global governance reforms”, in T. V. Paul (ed.), The China–India Rivalry in the Globalization Era (Washington DC: Georgetown University Press, 2018), p. 246. 13 Harsh V. Pant, “Rising India and its global governance imperatives”, in Harsh V. Pant (ed.), India and Global Governance: A Rising Power and Its Discontents (New York: Routledge, 2022) p. 2. 14 “Ambassador’s remarks at MP-IDSA — Sichuan University virtual dialogue”, 23 September 2021. https://www.eoibeijing.gov.in/eoibejing_listview/MTA1NA. 15 “India, China reach 5-point consensus to ease border tensions, no real headway on ­disengagement at LAC”, India Today, 11 September 2020. https:// www.indiatoday.in/india/story/india-china-meet-ministers-reach-5-pointconsensus-agree-quickly-disengage-1720691-2020-09-11. 16 “Joint press release of the 14th round of India-China Corps commander level meeting”, Ministry of External Affairs, Government of India, 13 January 2022. https://www.mea.gov.in/press-releases.htm?dtl/34751/Joint_Press_ Release_of_the_14th_round_of_IndiaChina_Corps_Commander_Level_ Meeting. 17 “China, India reach broad consensus in informal summit”, Ministry of Foreign Affairs, People’s Republic of China, 30 April 2018. https://www. fmprc.gov.cn/mfa_eng/wjb_663304/zzjg_663340/yzs_663350/gjlb_663354/ 2711_663426/2713_663430/201804/t20180430_513168.html. 18 Zheng Haiqi, “China-India relations: How different perceptions shape the future”, ISAS Insights No 659, Institute of South Asian Studies, National University of Singapore, 1 April 2021. https://www.isas.nus.edu.sg/papers/ china-india-relations-how-different-perceptions-shape-the-future/. 19 Yamini Aiyar et al., “India’s pathway to power: Strategy in a world adrift”, Centre for Policy Research, October 2021. p. 11. 20 C. Raja Mohan, “Why does the deepening Indo-US friendship puzzle so many”? The Indian Express, 9 March 2021. https://indianexpress.com/ article/opinion/columns/quad-group-india-us-relations-joe-biden-7219965/. 21 “China ignores India’s sovereignty concerns, plans to extend controversial CPEC to Afghanistan”, DD News, 24 May 2021. https://ddnews.gov.in/ international/china-ignores-india%E2%80%99s-sovereignty-concernsplans-extend-controversial-cpec-afghanistan#:~:text=India%20has%20 repeatedly%20registered%20its,Territory%20illegally%20occupied%20 by%20Pakistan.



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22 Jingdong Yuan, “China’s Belt and Road Initiative in South Asia and the Indian response”, Issues & Studies, 55(02), 2019, 14. 23 Hu Shisheng, “Outlook for South Asia in 2022”, China Institutes of Contemporary International Relations, 7 February 2022. http://www.cicir. ac.cn/NEW/opinion.html?id=56fc4206-c281-43e0-8e03-0c2904aaaeac. 24 “Some countries portrayed Quad as military alliance to raise ‘unsubstantiated fears’: Army Chief”, The Economic Times, 30 May 2021. https:// economictimes.indiatimes.com/news/defence/some-countries-portrayed-quadas-military-alliance-to-raise-unsubstantiated-fears-army-chief/article show/83085799.cms?from=mdr. 25 “Joint Communique of the 18th Meeting of the Foreign Ministers of the Russian Federation, the Republic of India and the People’s Republic of China”, Ministry of External Affairs, Government of India, 26 November 2021. https://www.mea.gov.in/bilateral-documents.htm?dtl/34540/ Joint_Communique_of_the_18th_Meeting_of_the_Foreign_Ministers_of_ the_Russian_Federation_the_Republic_of_India_and_the_Peoples_ Republic_of_China.

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© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_0010

Chapter 10

India Meets China in Its Periphery S. D. Muni

Summary Driven by its emerging strategic and economic capabilities and stakes, China is contesting India’s primacy in the latter’s periphery. Infrastructure investments under the Belt and Road Initiative (BRI) are one of the major instruments of China’s approach in this respect but it has also stepped up its political and cultural thrust. To meet the challenge of China’s push, India has revamped its ‘Neighbourhood First’ policy politically, financially and administratively. In addition, India is coordinating its efforts with other partner countries like the United States (US) and Japan that are similarly concerned about China’s expansion in Asia. India is making progress but there is a long way to go as the small countries in India’s neighbourhood are inclined to take advantage of India–China competition for influence and there is considerable internal political turbulence within them.

Introduction Henry Kissinger, the scholar-turned-statesman, in his book, On China, describes the US’ relationship with China as that of a “combative co-existence”. This might equally apply to Sino-Indian contemporary engagement. Explaining this complexity, India’s former National Security Advisor and former Foreign Secretary, Shivshankar Menon, wrote that 107

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“India–China relations do not fall into a simple binary opposition but exhibit a complex interplay in political, economic, security and other realms. The pattern of competition side by side with cooperation will likely continue to mark the relationship…”1 This complex interplay is evident at the global, regional and bilateral levels.

China in South Asia At the regional level, intense competition is unfolding in the India–China relationship in the Indo-Pacific region, which includes India’s immediate and extended neighbourhood, that is, South Asia, Southeast Asia and the Indian Ocean.2 In India’s immediate neighbourhood, China’s strategic approach has evolved gradually in the context of its broader engagement with India. During the happy years of Hindi-Chini Bhai Bhai (Indians and Chinese are brothers) of the 1950s, China recognised India’s primacy in its immediate neighbourhood. India, too, on its part, was quite accommodating to China in the region, as could be seen in its support for China’s Rice Rubber Deal with Sri Lanka in 1952 and establishment of diplomatic relations with Nepal in 1956. China then had serious concerns on Pakistan’s Cold War alliances with the US and started to wean Pakistan away from the US only after its war with India in 1962. The Hindi-Chini Bhai Bhai atmosphere was seriously eroded in the heat of developments in Tibet in 1959, the establishment of the Dalai Lama’s government-in-exile in India and growing disagreement between the two on their disputed border in the Himalayas. Apparently, that led to the Chinese aggression on India in 1962.3 In the context of growing distrust with India, China was now forthcoming to offer itself as a counterbalance to India’s immediate neighbours. It stood by King Mahendra of Nepal in 1960 in his termination of the democratic system and prosecution of democratic forces that were supported by India. It supported Myanmar’s (then Burma) economic nationalism under General Ne Win that pushed thousands of persons of Indian origin in Burma out of the country. It started cultivating Pakistan vigorously. China acquired nearly 5,300 square kilometres of territory in Pakistan-occupied Kashmir under a border agreement in 1963 and sided with Pakistan in both the 1965 and 1971 conflicts with India. China was one of the last countries to recognise Bangladesh, doing so only within days of the



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anti-Mujib coup in August 1975, which established a pro-Pakistani military order. In 1975, China also strongly opposed Sikkim’s integration into the Indian Union. A commentator in Beijing Review in July 1974 described India’s action in Sikkim as nothing short of “colonial expansion”.4 China’s desire to expand its economic and strategic footprint into South Asia has grown with the rise in its economic and political influence in Asia. This could be seen in pushing ideas like the Bangladesh, China, India and Myanmar (BCIM) Economic Corridor during the late 1990s to build infrastructure to connect its peripheral areas to South Asia for an economic outlet. However, China still did not directly and seriously challenge India’s strategic stakes in the region. It concluded several confidence-building measures with India like maintaining peace and tranquillity on the disputed border (Sino-Indian agreements on this subject were signed on 7 September 1993 and 29 November 1996). This positive trend in Sino-Indian relations continued until the early years of the 21st century when China softened its position on Sikkim as a part of India in 2003 and agreed in 2005 on political guidelines to resolve the border dispute.5 Relations, however, started deteriorating after that. The programmes of China’s massive economic growth and military modernisation added assertiveness in pursuance of China’s foreign policy in Asia in general. In South Asia, China was even encouraged to seek entry into the South Asian Association for Regional Cooperation (SAARC) through its friendly countries like Pakistan, Nepal and Bangladesh. It became an Observer of SAARC in 2005 and attended the 14th SAARC Summit in 2007. Some of these countries have continued to support China’s full membership of the SAARC.6 China emerged as a strong supporter of Sri Lanka in its elimination of the Tamil insurgency in 2009. It started pressing India to actively join the BCIM and secured Indian Prime Minister Manmohan Singh’s notional endorsement in 2013.7 China’s push into India’s immediate neighbourhood under President Xi Jinping has received a significant spurt within the overall complex “competition and cooperation” framework of Sino-India relations.8 Now, China is not waiting to be called by India’s neighbours for a counterbalancing role. It has its own stakes and drivers to push its strategic and economic interests in South Asia as a whole. These drivers include stabilising its restless Tibetan and Xinjiang periphery, entering the potentially large South Asian market (more than 1.6 billion people and

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growing on an annual average rate of five to six percent), expanding its outreach in the Indian Ocean to resolve the ‘Malacca Dilemma’ and countering the adversarial influence of the US and India in these countries.9 India’s smaller neighbours have been lured into supporting China’s BRI to build infrastructure connectivity, despite India’s strong opposition. Significant projects have been launched across Pakistan (China–Pakistan Economic Corridor), the Bay of Bengal and the Indian Ocean countries (Sri Lanka, the Maldives, Bangladesh and Myanmar). Through Nepal, China is also building a strategic Himalayan corridor for connectivity with Pakistan and Afghanistan. The total investments in all the BRI projects, mostly in the form of loans of different varieties, in South Asia are nearing US$100 billion (S$139.5 billion). China’s long-term goal in these countries seems to be their economic integration with the Chinese economy. For this, special economic zones are developed in these countries to tie them with China’s supply chains.10 Besides the BRI, in this push, China has entered the South Asian stock markets in a big way.11 In order to consolidate this economic and strategic push, China has started meddling in the domestic politics of the South Asian countries in order to have pliable regimes. It has also started its own China–South Asia grouping to respond to the COVID-19 pandemic since July 2021, even inviting India to join it.12 China’s support to the Mahinda Rajapaksa regime in Sri Lanka, the newly formed Nepal Communist Party (NCP) in Nepal in 2018 and the military establishments in Pakistan and Myanmar is well known. China has not hesitated to use the ports developed by it in Pakistan and Sri Lanka for military purposes by docking submarines and concluding long-term lease agreements, indicating clearly that its infrastructural projects are not without strategic design. China has also not left the cultural front untouched by projects promoting Buddhism, Chinese language, Confucius institutions and support for technical (engineering and medical) education in South Asia.

India’s Response For India, such a multipronged push by China in its immediate neighbourhood is an undesirable encroachment on its own vital strategic space. China’s strong presence in India’s periphery will keep the latter constrained in its role in Asia and the world and, also, given the unsettled



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border and areas of competition and rivalry with China in Asia, dangle a Damocles sword on its internal stability and territorial security; more so in the context of China’s aggressive face-off with India, first in Bhutan’s claims in Doklam in 2017 and then, since 2019, in the Ladakh region. China as a threat has been a recurring theme in India’s strategic narrative since 1962. Officially, India’s Defence Minister George Fernandes portrayed China as “potential threat No. 1” in May 1998, which was followed by Prime Minister Atal Bihari Vajpayee seeking justification for his nuclear explosions in the strategic threat posed by China.13 In recent years, India’s Chief of Defence Staff, General Bipin Rawat, and its Air Chief, Marshal V. R. Choudhary, have publicly reiterated that the major threat to India was from China.14 Within the framework of “combative co-existence”, the initial moves of the Chinese push in South Asia were not taken seriously by India. Its foreign policy was preoccupied with major power equations and the Pakistani threat. The first National Democratic Alliance government (1999–2004) and the two-term United Progressive Alliance regime (2004–2013) were busy pushing for greater strategic proximity with the US while balancing Chinese concerns through confidence-building measures and cooperative interaction. Singh’s government claimed an understanding with Pakistan on Kashmir through back-channel diplomacy, which could not be finalised and sealed due to Pakistan’s President General Pervez Musharraf’s fall from power in 2008.15 In October 2013, Singh visited China where he reiterated the significance of ‘Panchsheel’, underlined the need for “mutual and equal security” and concluded nine agreements, including one on border defence and peace.16 Some attention was paid to contain the Chinese push in smaller neighbours as they were invited to become partners in India’s growth story. The Nepalese monarchy, which was heavily dependent upon China to fight the Maoist insurgency, ignoring India’s advice of making up with the democratic forces, was abandoned in 2005–2006 in favour of mainstreaming the Maoists.17 India’s discomfort with Sri Lanka’s military dependence on China to fight the Tamil insurgency was strongly voiced to Colombo.18 After the end of Tamil insurgency in 2009, however, India undertook massive reconstruction programmes in Sri Lanka. India also strongly supported the Awami League government, headed by Sheikh Hasina, in Bangladesh to resolve pending bilateral disputes and enhance areas of cooperation, which markedly improved relations between the two countries. India was also hesitant in associating itself

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with the Chinese-initiated connectivity infrastructure projects like the BCIM, though notionally, India agreed in 2013, during Singh’s visit to study the proposal.19 All this was done even before Xi launched his signature charm offensive of the BRI. Indian Prime Minister Narendra Modi’s rise to power in May 2014 came with a new policy initiative of ‘Neighbourhood First’. It came on the heels of Xi’s announcement of the One Belt One Road initiative in 2013, which later became the BRI. Many analysts took the ‘Neighbourhood First’ policy as a move by India to meet the Chinese challenge in the South Asian region but there is no persuasive evidence to support this. It was perhaps more to bridge the attention gap in India’s policy towards its neighbours that led them feel neglected and alienated. Claims have been made to prompt Modi in this respect.20 The initial moves on the ‘Neighbourhood First’ policy also do not suggest that it was a well-thought-out and planned strategy as the policy soon fell out on Pakistan and Nepal. In Pakistan, within months of the ‘Neighbourhood First’ policy announcement, trade talks were called off by India in August 2014 over the question of Pakistan’s support for the Kashmir separatists’ All Parties Hurriyat Conference. Then, at its Kathmandu summit in November 2014, the SAARC process was derailed on the account of Pakistan’s refusal to endorse regional connectivity projects that would have allowed India direct access to Afghanistan and the Central Asian markets. Pakistan has also relentlessly pursued its cross-border terrorist attacks on India. Modi tried to revive relations with Pakistan by paying a surprise visit to Prime Minister Nawaz Sharif on a social pretext in December 2015 but in vain. Sharif was charged with corruption and removed in 2017. India–Pakistan relations have remained trapped in mutual hostility and confrontation on terrorism and the Kashmir issue since then. In the case of Nepal, India’s crude diplomatic intervention in its constitutional process in September 2015, followed by five months’ partial economic blockade, gave a huge spurt to anti-Indian nationalism.21 This led to the sweeping victory of China-backed NCP in the 2018 parliamentary elections and encouraged Prime Minister K. P. Sharma Oli in precipitating a new border claims on India’s traditional route to China at the Lipulekh/Kalapani region in Nepal’s northwest corner.22 India–Nepal relations have been seriously damaged by these developments and continue to remain full of concern for India.



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In Sri Lanka, India looked forward to the victory of a new coalition in January 2015 as an opportunity to advance the ‘Neighbourhood First’ policy. However, the coalition failed to revise its promised terms of engagement with China. Halfway through the journey, the coalition government developed serious internal contradictions leading to its eventual collapse.23 The Rajapaksa family rule re-emerged in November 2019, this time under the presidency of Gotabaya. India moved fast to reach out to the new regime and considerably improved its relations by helping Sri Lanka on its foreign exchange and energy crises as well as infrastructure projects.24 However, recent protests in the country have led to the ouster of Gotabaya as president and Mahinda as prime minister. The country is in turmoil. At the time of writing, the country’s parliament reconvened and elected a new president — Ranil Wickremesinghe. In the Maldives, President Abdulla Yameen’s regime had built close strategic equations with China, which did not allow Modi to visit under the ‘Neighbourhood First’ approach until 2018. India has regained some of its lost strategic space under the new regime, headed by Mohamed Solih, who came to power in September 2018. India’s increasing involvement in the Maldives’ development, including defence and security projects, has led the opposition to launch ‘India Out’ protests, which the Solih government has agreed to curb through legislative action.25 India’s ‘Neighbourhood First’ approach has also suffered on the account of the domestic political agenda of the ruling Bhartiya Janata Party which seeks electoral gains in polarising people along communal lines. India’s moves for the Citizenship (Amendment) Act and National Register for Citizens, enacted in 2019, discriminate against the Muslims. Hasina publicly expressed reservations on such moves as they threaten to de-nationalise the Bengali Muslims of Assam.26 Though the ‘Neighbourhood First’ approach could not meet the Chinese challenge effectively in Modi’s first term, its credibility as a viable instrument of regional policy has not been in question. Course corrections have been applied in recent years to the overall approach in order to reduce alienation of the neighbouring regimes and the people to regain the lost ground against China, as noted in the cases of Sri Lanka, the Maldives, Nepal and Bangladesh. The gains of the ‘Neighbourhood First’ policy, despite its initial lapses, have been significant. Attention may be drawn to the following aspects of the ‘Neighbourhood First’ initiative in this respect27:

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1. Through frequent high-level visits and telephone contacts, the Indian leadership has tried to maintain personal connections with the ruling as well as opposition leaderships in the neighbouring countries. 2. Modi has tried to reach out to the people at large during his official visits to the neighbouring countries. 3. India has tried to improve its delivery performance concerning its neighbours. Long pending connectivity and developmental projects have been expedited. The opening of the oil pipeline with Nepal, completion of the housing project in Sri Lanka and access to Indian power generation to Bangladesh stand out as some of the critical aspects in this respect. New allocations have been made to enhance developmental cooperation. In some cases, like Bangladesh, the Line of Credit, even for defence purchases, has been extended liberally. Bangladesh is negotiating a Comprehensive Economic Partnership Agreement with India. Foreign exchange, through currency swap to the tune of US$1.1 billion (S$1.53 billion), has been offered in April 2020 and January 2022 to Sri Lanka. 4. India has extended prompt and massive support of humanitarian ­assistance and disaster relief during the earthquake in Nepal in 2015, floods in Sri Lanka in 2017 and 2019, the drinking water crisis in the Maldives in 2014 and Rohingya refugees in Bangladesh in 2018–2019. The COVID-19 pandemic led to an attempt by India to revive the SAARC. However, this did not succeed due to the continuing hiatus with Pakistan. Medical support, in the form of vaccines, medicines, safety wears and health volunteers, has been extended to all the neighbours. 5. India has strengthened civilisational bonds with its neighbours by promoting Hinduism and Buddhism ties. 6. India has also competed with China’s regime change moves in South Asia. India’s enthusiastic support for the Awami League regime in Bangladesh in 2019, Solih’s regime in the Maldives in 2018, President Maithripala Sirisena’s regime in Sri Lanka in 2015 and the Lotay Tshering government in Bhutan in 2018 have been widely acknowledged in national and international media. The restoration of cooperative relations with Sri Lanka’s Rajapaksa regime has been noted. In Nepal, the Chinese-backed NCP has been broken and the Nepali Congress’s Sher Bahadur Deuba-led coalition government assumed power in July 2021. In a significant way, India’s neighbourhood approach has been facilitated by creeping controversies on China’s BRI. Increasing



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questions have been raised both within China and the host countries on the economic viability of some of the BRI projects, use of corrupt practices in their execution and economic (debt-trap) and cultural distortions caused by them.28 A number of BRI projects have been abandoned and revised. There have also been public protests and media criticism of these projects.

Beyond the ‘Neighbourhood First’ Policy Despite these gains, India is conscious that the allocation of resources and delivery of projects under its ‘Neighbourhood First’ policy cannot match the Chinese investments and efficiency under the BRI. China has also utilised its deep pockets in shaping power equations and regime characters in India’s neighbourhood.29 It has, therefore, been necessary for India to mobilise other policy options to meet the Chinese challenge. One of these has been the close collaboration with countries that are equally determined to resist the Chinese strategic expansion in Asia, namely, the US and Japan. India and Japan have been coordinating and collaborating on infrastructure projects in India’s neighbouring countries like Sri Lanka, Myanmar, the Maldives, Nepal and Bangladesh.30 The US has created two new instruments under its Indo-Pacific strategy, namely, the Millennium Challenge Compact (MCC) and the Asia Reassurance Initiative Act (ARIA). Under the ARIA, the US will spend US$1.5 billion (S$2.1 billion) in the Indo-Pacific region every year between 2019 and 2023. The unwritten thrust of these instruments is to counter the Chinese influence. Both these instruments are actively employed in India’s immediate neighbourhood as well.31 Both Nepal and Sri Lanka have accepted the MCC assistance for infrastructure projects. There seems to be an unstated acceptance by India of the US’ role under these instruments, which is in sharp contrast to the traditional policy of discouraging third countries’ involvement in its neighbourhood. India’s second option beyond the ‘Neighbourhood First’ policy has been to keep China engaged constructively without making any compromise on its core interests. An innovative approach of the informal summits has been introduced besides normal diplomatic engagement, including in multilateral/trilateral (like Russia–India–China) forums. Modi and Xi have had two such informal summits in Wuhan in China (2018) and Mamallapuram in India (2019). These summits had broader goals but regional issues in South Asia have also been a part of the

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discussions. Under the “Wuhan spirit”, India and China agreed to join hands for peace in Afghanistan.32 There were also reports of discussions on the status of Kashmir at the Mamallapuram summit. It would, however, be a mistake to assume that these summits have moderated the competition between the two in India’s immediate neighbourhood. Nonetheless, these summits were an attempt to keep balance and moderation in India–China relations and discourage third countries, including India’s neighbours, from unduly exploiting their rivalry. It was comforting for India when China avoided publicly endorsing Nepal’s new map to claim disputed border territory (in the Kalapani area) with India. China advised Nepal to resolve the issue through peaceful dialogue with India and reiterated the earlier agreement to have commercial and cultural contacts with India through the traditional route at Lipulekh.33 While keeping engaged with China, India has also sent a message that it is willing and capable of contesting and countering China on issues when its vital bilateral and regional stakes are involved. India’s face-off with China in Doklam was a clear message that it will stand by its security commitments to the neighbours like Bhutan. Resistance to Chinese aggression in Ladakh also sends a message that India is not a pushover, no matter how assertive and powerful China claims itself to be.

Summing Up The competition between India and China in South Asia has come to stay. The smaller South Asian states will take advantage of this competition to carve as much strategic advantage as possible for themselves. They will also use it as a window of opportunity to advance their respective developmental and political goals. India is able to meet the Chinese challenge in this region to some extent. As China experiences the gradual erosion of the BRI’s initial sheen and attraction, India’s efforts to counter its impact in the neighbourhood will gather further momentum. While strategic coordination with third countries like the US and Japan will support India in competing with China, the real answer for India lies in improving its economic and military capabilities in the region. A serious effort to evolve a credible strategy to cope with the consequences of China’s rise in Asia as a whole and its assertive push in the neighbourhood was never more challenging and urgent than now for India.



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Endnotes   1 Shivshankar Menon, Choices: Inside the Making of India’s Foreign Policy (India, Gurgaon: Penguin Random House, 2016), pp. 38–39.   2 Xiangming Chen, Pallavi Banerjee, Gaurav Toor and Ned Downie, “China and South Asia: Contention and cooperation between giant neighbours”, European Financial Review, 22 April 2014. https://www.europeanfinancialreview.com/china-south-asia-contention-cooperation-giant-neighbours/.   3 For an excellent account of the role of Tibet factor in vitiating India–China relations, see Nirupama Rao, The Fractured Himalaya: India, Tibet, China 1949–1962 (Viking, 2021).   4 “Taching is five times its former self”, Beijing Review, 12 July 1974, p. 16. http://www.massline.org/PekingReview/PR1974/PR1974-28.pdf.   5 In 2003, China agreed to have trade and cultural relations with India through Nathula Pass of Sikkim, accepting it as under India’s control, and, in 2005, India and China agreed on the “Political Parameters and Guiding Principles for the Settlement of the India–China Boundary Question”. The texts of these documents are available on the website of India’s Ministry of External Affairs.  6 S. Y. Surendra Kumar, “China’s SAARC membership: The debate”, International Journal of China Studies, VI(3), December 2015, 299–311. https://icsum.org.my/wp-content/uploads/2020/02/kumar.pdf.   7 In the Joint Statement issued during Chinese Premier Li Keqiang’s to India in May 2013, it was agreed to constitute a “Joint Study Group on strengthening connectivity in the BCIM region…”, paragraph 18. https://mea.gov.in/ bilateral-documents.htm?dtl/21723/Joint+Statement+on+the+State+Visit+of +Chinese++Li+Keqiang+to+India.  8 Zhan Yunling, “China and its neighbourhood: Transformation, challenges and grand strategy”, International Affairs, 92(4), July 2016, 835–848. Also see, Prashant Kumar Singh, “Deepening the engagement”, in J. P. Panda (ed.), China’s Transition Under Xi Jinping (Pentagon Press New Delhi, 2016), pp. 277–313.   9 Rajiv Ranjan and Guo Changgang (eds.), China and South Asia: Changing Regional Dynamics, Development and Power Play (Routledge Publishers, 2022). Also see Sanjeev Kumar, “China’s South Asia policy in a ‘New Era’”, India Quarterly, 75(2), June 2019, 137–154. 10 Derek Grossman, “What China wants in South Asia”, ORF Issue Brief No. 368, June 2020, Observer Research Foundation, New Delhi, 2020. https:// www.orfonline.org/research/what-china-wants-in-south-asia-67665/. 11 Arafat Kabir, “China outbids India for Bangladesh’s largest stock exchange — What next?” Forbes, 16 May 2018. https://www.forbes.com/

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sites/arafatkabir/2018/05/16/china-outbids-india-for-bangladeshs-largeststock-exchange-whats-next/?sh=361342d97f2c. 12 Suhasini Haider, “India is welcome to join China-South Asia grouping”, The Hindu, 20 July 2021. https://www.thehindu.com/news/international/india-iswelcome-to-join-china-south-asia-grouping/article35433572.ece. 13 This was done by Vajpayee in his letter to the United States’ president on India’s nuclear explosion in May 1998. Kenneth J. Cooper and Steven Mufson, “Nuclear cloud is cast over India’s relations with China”, Washington Post, 1 June 1998. https://www.washingtonpost.com/archive/ politics/1998/06/01/nuclear-cloud-is-cast-over-indias-relations-with-china/ 0190ab15-8d2a-4932-81a1-2aab35a26ac9/. 14 “China biggest security threat, says General Bipin Rawat, Times of India, 13 November 2021. https://timesofindia.indiatimes.com/india/china-biggestsecurity-threat-says-general-bipin-rawat/articleshow/87675595; China biggest threat for India’s strategic goals, says air force chief”, Indian Express, 8 December 2021. https://indianexpress.com/article/india/china-biggestthreat-for-indias-strategic-goals-says-air-force-chief-7662366/cms. 15 “Manmohan Singh, Musharraf came close to striking Kashmir deal: Wikileaks”, The Times of India, 3 September 2011. https://timesofindia. indiatimes.com/india/manmohan-singh-musharraf-came-close-to-strikingkashmir-deal-wikileaks/articleshow/9841701.cms. 16 “Manmohan Singh concludes China visit having signed border pact”, The Economic Times, 24 October 2013. https://m.economictimes.com/news/ politics-and-nation/manmohan-singh-concludes-china-visit-having-signedborder-pact/articleshow/24650392.cms. 17 For details see, S. D. Muni, “Bringing the maoists down from the hills: India’s role”, in Sebastian von Einsiedel, David M. Malone and Suman Pradhan (eds.), Nepal in Transition: From Peoples’ War to Fragile Peace (Cambridge University Press, 2012), pp. 313–331. Also see Sudheer Sharma, Nepal Nexus: An Inside Account of the Maoists, the Durbar and New Delhi (India: Penguin Random House, 2019). 18 India’s Foreign Secretary Shivshankar Menon and National Security Advisor M. K. Narayanan visited Colombo in April 2009 to convey disapproval of killing Tamil civilians and depending on China and other countries militarily. 19 Reimeingam Marchang, “BCIM economic corridor and Northeast India”, Working Paper No. 470, The Institute for Social and Economic Change, Bangalore, January 2020, p. 3. http://www.isec.ac.in/WP%20470%20-%20 Marchang%20Reimeingam%20-%20Final.pdf. 20 K. Natwar Singh, One Life is Not Enough: An Autobiography (New Delhi: Rupa Publications India, 2014), p. 374. Former Foreign Secretary M. K. Rasgotra has also made such claims in his public lectures.



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21 Considerable writings are available on India’s contemporary relations with Nepal and Pakistan. See, for instance, S. D. Muni on (1) “Modi’s Neighbourhood Initiative”, Economic and Political Weekly, 49(38), 20 September 2014; (2) “The Ufa Fiasco”, Economic and Political Weekly, 50(36), 5 September 2015; and (3) “Nepal’s New Constitution”, Economic and Political Weekly, 50(40), 3 October 2015. 22 Prabhash K. Dutta, “Lipulekh: What is Kalapani dispute between India and Nepal, why is it news now”, India Today, 18 May 2020. https://www. indiatoday.in/india/story/lipulekh-kalapani-india-nepal-mansarovarwhat1679173-2020-05-18. 23 Some details of the new coalition and its collapse have been discussed elsewhere. See, S. D. Muni, “Sri Lanka’s transformational elections”, ISAS Insights No 274, Institute of South Asian Studies, National University of Singapore, 13 January 2015. https://www.isas.nus.edu.sg/wp-content/ uploads/media/isas_papers/ISAS_Insights_No._274_-_Sri_Lanka_ Transformational_Election_13012015203349.pdf; and D. Muni, “Sri Lanka’s crisis: Conflict of class and power”, ISAS Insights No 523, Institute of South Asian Studies, National University of Singapore, 26 November 2018. https:// www.isas.nus.edu.sg/wp-content/uploads/2018/11/ISAS-Insights-No.-523Sri-Lankas-Crisis.pdf. 24 Meera Srinivasan, “Renewing Indo-Lanka relations after a period of strain”, The Hindu, 9 February 2022. https://www.thehindu.com/news/international/ renewing-indo-lanka-relations-after-a-period-of-strain/article38400468.ece. 25 Neha Banka, “Explained: What Yameen’s acquittal means for India– Maldives relations”, The Indian Express, 17 December 2021. https:// indianexpress.com/article/explained/explained-abdulla-yameen-acquittalindia-maldives-relations-7676212/; Rangoli Mitra, “The India–China Cold War in Maldives”, The Diplomat, 19 January 2022. https:// thediplomat.com/2022/01/the-china-india-cold-war-in-maldives; and Yeshi Sali, “Maldives Government Considering Law to criminalise ‘India-Out’ campaign launched by ex-President”, The New Indian Express, 7 February 2022. https://www.newindianexpress.com/nation/2022/feb/07/maldivesgovt-considering-law-to-criminalise-india-out-campaign-launched-by-expresident-2416508.html. 26 “CAA, NRC internal matters of India: Bangladesh PM Sheikh Hasina”, Mint, 19 January 2020. https://www.livemint.com/news/india/caa-nrcinternal-matters-of-india-bangladesh-pm-sheikh-hasina-11579421670922. html. 27 The following summary has been drawn on the basis of the Country Briefs prepared regularly by the Indian Ministry of External Affairs. These briefs can be accessed on the ministry’s website. The space and time constraints do not allow for a discussion of the details here. For a discussion of India’s

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28

29

30 31

32 33

connectivity efforts towards its neighbours, see Constantino Xavier, “Sambandh as strategy: India’s approach to regional connectivity”, Policy Brief, Brookings India, New Delhi, January 2020. https://www.brookings. edu/research/sambandh-as-strategy-indias-new-approach-to-regionalconnectivity/. “Xi Jinping’s BRI faces criticism during China’s annual political sessions; report”, The Times of India, 13 March 2019. https://timesofindia.indiatimes. com/world/china/xi-jinpings-bri-faces-criticism-during-chinas-annualpolitical-sessions-report/articleshow/68390105.cms. Also see David Sacks, “China-Pakistan economic corridor: Hard reality greets BRI’s signature initiative”, Blog, Council on Foreign Relations, 30 March 2021. https://www. cfr.org/blog/china-pakistan-economic-corridor-hard-reality-greets-brissignature-initiative. Maria Abi-Habib, “How China got Sri Lanka to cough up a port”, New York Times, 25 June 2018. https://www.nytimes.com/2018/06/25/world/asia/ china-sri-lanka-port.html; and Kamal Dev Bhattarai, “China’s growing political clout in Nepal”, The Diplomat, 22 May 2020. https://thediplomat. com/2020/05/chinas-growing-political-clout-in-nepal/. Gazi Hasan, “China factor in India–Japan Relations”, in India and Japan: Growing Partnership and Opportunities for Cooperation, Centre for Public Policy Research, Kochi, Kerala, India, July 2019, pp. 15–19. Aparna Pandey, “US wants India to stand up to China. It can do that only with American aid and tech support”, The Print, 18 May 2020. https:// theprint.in/opinion/us-wants-india-to-stand-up-to-china-it-can-do-that-onlywith-american-aid-and-tech-support/422444/; and Kripendra Amatya, “The MCC and Nepal’s strategic ties with the US”, The Diplomat, 19 February 2020. https://thediplomat.com/2020/02/the-mcc-and-nepals-strategic-tieswith-the-us/. Elizabeth Roche, “India, China to work closely to bring peace in Afghanistan”, LiveMint, 10 May 2019. https://www.livemint.com/news/india/india-chinato-work-closely-to-bring-peace-in-afghanistan-1557508717143.html. “Kalapani issue is between Nepal and India, says Chinese foreign ministry”, The Kathmandu Post, 19 May 2020. https://kathmandupost.com/ national/2020/05/19/kalapani-issue-is-between-nepal-and-india-sayschinese-foreign-ministry.

© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_bmatter

About the Authors

Chulanee Attanayake is a Research Fellow at the Institute of South Asian Studies (ISAS) in the National University of Singapore. Her research focus is on China and its policies in South Asia. Prior to joining ISAS, Dr Attanayake served as the Director (Research)  of the Institute of National Security Studies Sri Lanka, the national security think-tank under Sri Lanka’s Ministry of Defence. She was a Visiting Lecturer at the Bandaranaike Centre for International Studies on Politics in South Asia and Politics in the Indian Ocean and at the Royal Institute of Colombo. She also worked as a Research Associate at the Lakshman Kadirgamar Institute for International Relations and Strategic Studies, a think-tank under the Sri Lankan Ministry of External Affairs. C. Raja Mohan is a Visiting Research Professor at the Institute of South Asian Studies (ISAS) in the National University of Singapore and a Senior Fellow at the Asia Society Policy Institute in New Delhi, India. He was the Director of ISAS from May 2018 to December 2021. Professor Raja Mohan was previously Professor of South Asian Studies at Jawaharlal Nehru University, New Delhi, and at the S. Rajaratnam School of International Studies, Nanyang Technological University, Singapore. He was also the founding Director of Carnegie India, New Delhi — the sixth international centre of the Carnegie Endowment for International Peace, Washington DC.

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122  About the Authors

Iftekhar Ahmed Chowdhury is an Honorary Fellow at the Institute of South Asian Studies in the National University of Singapore. He was previously a long-time Principal Research Fellow at the Institute. Earlier, Dr Chowdhury was Foreign Advisor (Foreign Minister) of Bangladesh (2007–2009). He was also Ambassador and Permanent Representative of Bangladesh to the United Nations (UN) and the World Trade Organization in New York and Geneva. He has also served as Ambassador to Qatar. As an international civil servant, Dr Chowdhury was also Special Advisor to the Secretary General of the UN Conference on Trade and Development. He was Senior Group Advisor at Meinhardt International, a Singaporebased multinational company, till October 2022. He is now based in Bangladesh. Shanthie Mariet D’Souza is a Visiting Fellow at the Stiftung Wissenschaft und Politik in the German Institute for International and Security Affairs, Berlin. She is the Founder and President, Mantraya; Board Director at Regional Centre for Strategic Studies, Colombo; Visiting Faculty and Member of Research and Advisory Committee at the Naval War College, Goa; Non-resident scholar, Middle East Institute, Washington DC; Research Fellow at WeltTrends-Institut für internationale Politik, Potsdam, Germany; and International Advisor, Nordic Counter Terrorism Network, Helsinki, Finland. Dr D’Souza is also a Member of the Board of Studies in the School of International and Area Studies in Goa University; Editorial board member of Small Wars & Insurgencies (Routledge: United Kingdom); and Adviser for Independent Conflict Research and Analysis, London. She has conducted field research in Afghanistan, Pakistan, China, Africa, Australia, the United States, Jammu and Kashmir and India’s Northeast. Suhasini Haidar is the Diplomatic Editor of The Hindu, one of India’s oldest and most respected national dailies. She writes regularly on foreign policy issues and hosts a weekly online show “Worldview with Suhasini Haidar”. Prior to this, Ms Haidar was Foreign Affairs editor and prime time anchor for India’s leading 24-hour English news channel CNN-IBN (2005–2014) and Correspondent for CNN International’s New Delhi bureau before that.



About the Authors    123

Touqir Hussain is a former Senior Diplomat of Pakistan, having served as Ambassador to Brazil, Spain and Japan (1998–2003). He has held senior positions in the Pakistani Foreign Office, including that of ­ Additional Foreign Secretary heading the bureaus of the Middle East and of the Americas and Europe. He was the Diplomatic Adviser to the Prime Minister of Pakistan from 1996 to 1998. Professor Hussain has been pursuing an academic career in the United States (US) since 2003. He was a Senior Fellow at the US Institute of Peace (2004–2005) and a Research Fellow at the Centre for the Study of Globalization George Washington University (2006–2010). Currently, Professor Hussain is a Visiting Senior Research Fellow at the Institute of South Asian Studies in the National University of Singapore and an Adjunct Faculty at Georgetown University and Syracuse University. Pramod Jaiswal is a Research Director at Nepal Institute for International Cooperation and Engagement. He has been a regular and visiting faculty at different universities in Nepal (Tribhuvan University, Kathmandu University, Pokhara University and Army Command and Staff College) and China (China Foreign Affairs University, Fudan University, Tongji University and Qinghai University of Nationalities). Dr Jaiswal is a Visiting Fellow at Sandia National Laboratories at the Cooperative Monitoring Center in Albuquerque, New Mexico, United States; a Senior Fellow at the Institute of Peace and Conflict Studies in New Delhi, India; and a researcher at South Asian Studies at the Institute of Asian Studies in Chulalongkorn University, Bangkok. Previously, he worked with Manohar Parikkar Institute for Defence Studies and Analyses, New Delhi, and as Delhi Correspondent with The Rising Nepal. S. D. Muni is Professor Emeritus at the School of International Studies, Jawaharlal Nehru University (JNU), New Delhi, and a member of the Executive Council of the Institute for Defence Studies and Analyses, New Delhi. He is also an Honorary Fellow at the Institute of South Asian Studies (ISAS) in the National University of Singapore. For nearly 40 years, Professor Muni taught, conducted and supervised research in international relations and South Asian studies at JNU (1974–2006), ISAS (2008–2013), Banaras Hindu University (1985–1986) and University of Rajasthan (1972–1973).

124  About the Authors

Professor Muni served as India’s Ambassador to Laos (1997–1999) and Special Envoy to the Southeast Asian countries on United Nations Security Council Reforms (2005). He was also bestowed upon Sri Lanka’s highest national award for a foreigner: Sri Lanka Ratna. Athaulla A. Rasheed is a PhD candidate at the Department of Pacific Affairs in Australian National University. His research focus is on politics and international relations, particularly on small island ­ developing states, climate security and international politics. He is a former diplomat and foreign service officer in the Ministry of Foreign Affairs of the Maldives. Dr Rasheed holds a PhD in development, governance and politics of the Maldives from the University of Queensland, Australia. Hernaikh Singh is Deputy Director at the Institute of South Asian Studies at the National University of Singapore (NUS). He has more than 30 years of experience in Singapore’s government and non-government organisations, the business sector and the academic fraternity. He has managed a diverse range of portfolios, including international relations; policy and business development; and administrative, editorial and publication management. He also has significant experience in training and research development. Mr Singh has been publishing regularly. His recent co-edited books, ASEAN and India: The Way Forward (Singapore: World Scientific, 2022) and India On Our Minds (Singapore: World Scientific, 2020), were respectively launched by Singapore’s Emeritus Senior Minister Goh Chok Tong and Singapore’s Prime Minister Lee Hsien Loong. Mr Singh holds a Master of Arts (Southeast Asian Studies) degree from NUS. For his outstanding academic achievements, he was awarded the Dr Benjamin Batson Gold Medal. He graduated with a Bachelor of Arts (Honours) degree from the same university. Zheng Haiqi is currently a Non-Resident Fellow at the Institute of South Asian Studies (ISAS) in the National University of Singapore and a PhD Candidate at the School of International Studies in the Renmin University of China. He has previously served as a Visiting Scholar at ISAS. Mr Zheng’s current research focuses on maritime security and Sino-India relations. His publications have appeared in ISAS as well as several Chinese newspapers. During his appointment in ISAS, he also published in peer-reviewed journals such as East Asian Policy.

© 2023 World Scientific Publishing Company https://doi.org/10.1142/9789811263729_bmatter

Index

A Abdul, A. K., 23 Adani Group, 85 Adityanath, Yogi, 58 Afghanistan, 2, 5, 7–16, 72 Afghan National Defence and Security Forces (ANDSF), 8 ‘all-weather’ partnership, 3, 65, 67 Asia–Africa Growth Corridor, 101 AstraZeneca vaccine, 80, 83–84 Australia, 29 Awami League, 21, 111, 114

Bengaliness, 21 Bharatiya Janata Party (BJP), 22 Bhutan, 2, 5, 29–39 Bhutanese National Assembly (BNA), 35 Biden, Joe, 72, 100 bilateral relations, 1, 7, 14, 23–24, 30, 33, 47, 67, 93–97 Border Roads Organisations (BRO), 32 Brazil, Russia, India, China and South Africa (BRICS), 2, 98 Buddhism, 32, 110, 114 Bull, Hedley, 19

B Banerjee, Mamata, 22 Bangladesh, 2, 4–5, 19–27, 109 Bangladesh, China, India and Myanmar (BCIM), 14, 24, 26, 109, 112 Bangladesh–China Relations, 23–25 Bangladesh–India Relations, 21–23 Bangladesh Nationalist Party (BNP), 21 Bay of Bengal, 20, 22, 110 Belt and Road Initiative (BRI), 3–4, 12–13, 24, 30, 45–49, 55, 62, 70–71, 93, 100–101, 107, 110, 112, 116

C Charybdis, 19–27 Chi Haotian, 59 China, 2, 7–16, 19–27, 65–74, 77–87, 93–103, 107–116 China–India rivalry, 65 China–Pakistan Economic Corridor (CPEC), 13, 67–71, 81–82, 100–101 China–South Asian Countries Emergency Supplies Reserve, 82 China–South Asia Poverty Alleviation, 82 Chinese People’s Liberation Army, 59 125

126  Index

Choudhary, Marshal V. R., 111 Chou En-Lai, 36 Citizenship Amendment Act, 22 Cold War, 65, 108 Colombo, 5, 87 Colombo International Container Terminals (CICT), 85 competition, 57–61 confrontation, 57–61 Connect Central Asia, 9 Cooperative Development Center, 82 COVID-19 pandemic, 14, 38, 44, 77–87, 114 D debt trap diplomacy, 26, 45, 48–49 divergent approaches, 10–13 Dorji, Sonam Topgay, 31 E economic interdependence, 65–74 economic transformation, 3 European Union (EU), 25 F Fernandes, George, 111 free trade agreement (FTA), 45 G Gampo, Songtsen, 30 Gayoom, Maumoon Abdul, 46 Gayoom, Yameen Abdul, 44, 47, 51 Ghani, Ashraf, 11 Greater Malé Connectivity Project, 49 gross domestic product (GDP), 78 Guddu Power Project, 67 H Hasina, Sheikh, 21, 23 Heavy Rebuild Factory, 67 hydroxychloroquine (HCQ), 15, 80

I India, 4, 7–16, 19–27, 29–39, 77–87, 107–116 India–Bhutan relationship, 30 India–Bhutan Treaty of Perpetual Friendship, 31 India–China rivalry, 55–63 ‘India First’ policy, 43–44, 47–48, 50 Indian Ocean region (IOR), 29 Indian Royal States, 31 India Ports Global Limited, 11 India’s internal policy, 23 Indo-Nepal Treaty of Peace and Friendship, 57 Indo-Pacific strategy, 4, 13, 29, 45, 49, 62–63, 69, 71, 100, 102, 108, 115 international community, 8, 47, 79–80 International Monetary Fund, 86 international politics, 55 Islamic Emirate, 9, 11 J Jaishankar, S., 38, 99 Japan, 29 John Keells Holdings, 85 K Karzai, Hamid, 11 Kaul, T. N., 34 Khan, Imran, 71–73 Khmer Rouge, 35 Khorasan Province, 8 Kissinger, Henry, 107 Koirala, Bishweshwar Prasad, 56 Koirala, Girija Prasad, 56 Kong Xuanyou, 36 Kunming Initiative, 24

Index    127

L Land Boundary Agreement, 22 Line of Actual Control, 27, 29, 98 Lintner, Bertil, 38 Long Xingchun, 96 M Main Line (ML-1) project, 81 Maldives, 5 Maldives–China relations, 46 Maldives’ foreign policy, 43–51 Maldives–India strategic developments, 50 Maldives National Defence Force, 50 Maldives–US defence cooperation, 49 Mao Zedong, 1, 71 Massoud, Ahmad, 8 Maumoon, Dunya, 46 memorandum of understanding (MoU), 36, 62 Menon, Shivshankar, 37, 97, 107 Millennium Challenge Corporation (MCC), 55 Ministry of Foreign Affairs (MFA), 34, 95 Modi, Narendra, 4, 7, 13, 21, 23, 32, 44, 62, 69, 71, 96, 112 Mohan, C. Raja, 71 mother-daughter relationship, 37 Motor Vehicle Agreement, 38 Mujahid, Zabiullah, 13 Mukherjee, Pranab, 21–22 Muslimness, 21 Myanmar, 3, 108 N Naravane, M. M., 62 Nasheed, Mohamed, 47–48 National Democratic Alliance, 111

National Plant Quarantine Service, 84 National Resistance Front of Afghanistan (NRFA), 8, 16 National Security Advisor, 97, 107 Nehru, Jawaharlal, 31 Neighbourhood First policy, 79, 112–113, 115–116 Nepal, 2–3, 5, 55–63, 109 Nepal–China trade, 60 Nepal Communist Party (NCP), 57, 110 ‘New’ Afghanistan, 8 Non-Alignment Movement (NAM), 34 non-convergence, 9–10 North Atlantic Treaty Organization, 8 Nuclear Suppliers Group, 14 O Oli, K. P. Sharma, 56–57, 112 P Pakistan, 2–4, 65–74 Pakistan–China relations, 73 paracetamol, 80 peace, 9–10 Penjore, Dorji, 38 People’s Liberation Army (PLA), 35 personal protective equipment (PPE), 82 political independence, 45–46 Project Dantak, 32 Q Qingdao Seawin Biotech Group, 84 Quadrilateral, 29 Quadrilateral Cooperation Group, 10

128  Index

Quadrilateral Security Dialogue, 2, 49, 63, 69, 102 Qureshi, Shah Mehmood, 72 R Rahman, Sheikh Mujibur, 23–24 Rajapaksa, Gotabaya, 83–84 Rawat, Bipin, 111 regional traditions, 45–46 reset China policy, 14 Russia, 2 Rustomji, Nari, 33 S Sagarmatha Friendship, 59 Scylla, 19–27 seclusion, 33–34 Second World War, 1 Security and Growth for All in the Region (SAGAR), 101 Shahid, Abdulla, 50 Singh, Manmohan, 21, 37, 109, 111 Singh, Sujatha, 37 Sino-Indian relations, 1, 93–103 Sitharaman, Nirmala, 86 Solih, Ibrahim Mohamed, 43–44, 48, 114 South Asia, 3–4, 49–50, 69, 71, 78–79, 83, 93, 98, 101, 108–111, 115–116 South Asian Association for Regional Cooperation (SAARC), 45, 79–80, 82, 109, 112, 114 sovereignty, 33–34 Sri Lanka, 5, 77–87 Sri Lankan Ports Authority, 85 stick and carrot policy, 36 strategic cooperative partner, 68, 94 Strategic Partnership of Cooperation, 24 Swaraj, Sushma, 22

T tactical alliance, 65–74 Taliban Islamic Emirate, 8 Tarapore, Arzan, 98 Thinley, Jigmi Y., 37 Tibet, 1, 5 Tin Bigha, 21 Trans-Himalayan Economic Corridor, 82 Trump, Donald, 99 Tsering, Lyonpo Dawa, 35 U Ukraine crisis, 27, 72 UN General Assembly, 102 UnionPay International, 60 United Kingdom, 25 United Nations (UN), 10, 24, 67 United Nations Organisation (UNO), 34 United Nations Regional Peace Keeping Centre, 59 United Nations Security Council (UNSC), 34, 37, 99 United States (US), 2, 8, 25, 29, 93, 107 UN Security Council (UNSC), 14, 25, 71 US–China Cold War, 70 US–China rivalry, 69, 72 US–India defence security cooperation, 100 US-led international forces, 10 US–Pakistan relations, 66 V Vajpayee, Atal Bihari, 111 W Wangchuck, Jigme Singye, 31–32, 34 Wang Yi, 9, 83, 99

Index    129

Wen Jiaobao, 37 Western Container Terminal, 85 World Bank, 78 World Health Organization (WHO), 78 Wu Xueqian, 35

X Xi Jinping, 7, 13, 21, 24, 47, 96, 109 Z Zhou Enlai, 24