Dec 14, 2011

India's Rise Puts China on Edge

By Greg Sheridan

The birth of a superpower can be a strange and disturbing event to witness. There is a lot of screaming, a lot of pain, it's inherently messy; but sometimes something beautiful will emerge.

Kolkata (formerly Calcutta) in West Bengal was once, before World War II, governed by an Australian, Richard Casey. As a city, it offers in every aspect the harshest contrasts of Indian life.

Near the airport, in the incongruously named Salt Lake district, sparkling new apartments and IT offices abound. And in the city centre, at the Oberoi Hotel, every sweet fragrance, every self-indulgent elegance of the British Raj is perfectly maintained.

But Kolkata, for many decades under communist rule, has not boomed like other Indian cities. Just a few blocks from the Oberoi families live in makeshift tents on the footpath, mothers washing babies without a shred of privacy. Middle-aged men, homeless and hungry, sleep on the balustrades on the edge of a public park. And on Sunday, everywhere the eye can see, men and boys play cricket.

But don't be fooled by the surface chaos. The elephant is stirring. Even without further slashing economic reform, India's economy will likely grow by 7 per cent or 8 per cent a year for the next two decades or more, becoming in time the world's third largest economy. As Defence Minister Stephen Smith says, in the 21st century there will be three superpowers: the US, China and India. But don't think this transition will be smooth.

Casey's successor in the Kolkata governor's residence is a smooth former Indian civil servant, and before that policeman, M.K. Narayanan. He was once India's national security adviser.

This week he opened a conference on the Asian Century sponsored by the University of Melbourne'sAustralia India Institute. He had two themes. One was that Australia had nothing to be concerned about from India's rise. This struck me as true but a little bit of an odd thing to say. I can't remember the last Australian who expressed any concern about India's rise.

The second notable theme was more blunt. China, he said, was a nation that did not observe international norms. This statement was neither controversial nor emotive. It was matter-of-fact.

Everyone has a certain idea of the likely shape of strategic competition in the years to come. The established superpower will have difficulty accommodating the rise of a new one. Everyone thinks this means the US will have difficulty accommodating a rising China. But in terms of stress, aggravation and in the worst case the risk of conflict, this is likelier to come from China having difficulty accommodating a rising India.

India's attitude to China is many layered and exceptionally complex. But two features stand out. One is that India and China are doing a booming trade, worth more than $US60 billion ($585bn) last year. They each benefit from the other's growth.

Perhaps even more important is that no nation in Asia is more naturally, inevitably and unavoidably a strategic competitor with China than is India.

A good deal of attention is given to their contradictory economic models, and equally to the fact India is a democracy and China an authoritarian, centrally governed communist dictatorship.

Proponents of the Chinese model say the swiftness of government decision-making gives it an economic advantage. Proponents of the Indian model counter that while dictatorship looks stable, it is really brittle, and democracies are built to last. And India's younger population structure means it is likely to be able to sustain high economic growth for much longer than China.

But not enough attention is paid to the hard power and geo-strategic clash between the two rising Asian giants.

From the Indian point of view, Beijing has already taken massive action over decades to try to keep India weak and vulnerable.

At the Kolkata conference I interviewed one of the most influential figures in Indian strategic policy. Gopalaswamy Parthasarathy is a former Indian ambassador to Australiaand to Pakistan.

Partha, as he is universally known, is now a professor of strategic studies, but also a highly influential adviser to government on security matters.

"China is today the greatest proliferator of nuclear weapons technology and missiles," he says.

"It has over the last four decades supplied Pakistan with nuclear weapons designs and equipment for enriching uranium. In more recent years it has been supplying Pakistan with plutonium reactors and reprocessing plants to make plutonium warheads to fit on Chinese-designed missiles. These warheads can develop thermo-nuclear capability.

"This Sino-Pakistan nuclear co-operation has enabled Pakistan to proliferate nuclear technology to North KoreaLibya and Iran."

China's actions, Partha says, are "obviously primarily directed atIndia. Pakistan is the instrument of Chinese containment of India."

Not every Indian is as stark in their words on China as Partha. But the basic dynamic of Beijing proliferating nuclear technology to Pakistan in order to give India endless trouble on its western border is widely accepted. Most Indians believe Beijing has done a great deal to mess India up.

A few days later, on the other side of India, I go to see Ajai Sahni, editor of the South Asian Intelligence Review and director of the Institute for Conflict Management. I ask him about India's non-Islamist security challenges, particularly the Maoist insurgency active across some nine states in the northeastern belt of India.

"There is no direct Chinese government involvement with the Maoists," Sahni says. "The Maoists reject the China of today as a revisionist state. They find inspiration in the China of Mao's day."

But the Chinese do provide support to some of the ethnic insurgencies that operate in northeast India, near India's border with China and its border with Burma.

"Some Chinese weapons do come to the Maoists from the ethnic insurgent groups which do have Chinese connections," Sahni says. "Some of these groups earlier had safe havens in Bhutan, Bangladesh, Nepal. They have all closed down. The groups have been drawn to Myanmar (Burma) and there they can be presented in one easy group to the Chinese government."

Praveen Swami, a renowned strategic analyst for the Hindu newspaper, tells me some Naga insurgents get weapons and support from China and have been passing this on to the Maoists in India.

"So far it's mainly been Kalashnikovs, improvised explosive device courses and training," Praveen says. "Whenever this is raised with the Chinese they say it's black-market stuff, but some people say it's carried out by people with high (Chinese) People's Liberation Army connections."

The strategic conflict between India and China is the subject of a fascinating new book, China and India, Great Power Rivals, by Mohan Malik, a scholar based at a Hawaii think tank. One of the best books on any foreign subject this year, its thesis is that China is trying to stymie India's rise.

Malik paints a devastating portrait of Chinese nuclear proliferation, primarily to Pakistan. But he makes a persuasive case that Pakistan's subsequent proliferation to nations such as North Korea and Iran is carried out with Chinese consent and serves Chinese strategic interests.

Malik also demonstrates how China has effectively encircled India with Chinese strategic assets.

"All of India's neighbours," Malik writes, "remained China's top five largest arms buyers: Pakistan, Burma, Bangladesh, Iran and Sri Lanka."

Since 2006, Beijing has deliberately turned up the heat on a long dormant territorial dispute, claiming sovereignty over the Indian territory of Aranachal Pradesh, and other territory near Tibet. It also continues to occupy part of Kashmir, which it took control of in its brief war with India in 1962.

Until 2006, international observers thought these disputes had effectively been settled, with both sides accepting the actual lines of control as long-term borders. But in recent years, according to Malik, Chinese patrols have been deliberately crossing into Indian territory. Indian strategic analysts believe the Chinese use such patrols to signal displeasure with Delhi. But this is a dangerous game. India has reinforced its borders with thousands more troops and stationed advanced Sukhoi fighters there.

Malik writes that Beijing's strategy towards India has three elements. The first is encirclement, with "strengthened Chinese strategic presence in Tibet, Pakistan, Nepal, Sri Lanka, Bangladesh, Burma and in the Indian Ocean island states". The second element is envelopment, which is essentially integrating all of India's neighbours into the Chinese economy. The third element is entanglement, which Malik describes as "exploiting India's domestic contradictions and multiple security concerns".

India is not passive in the face of all this. It is pursuing a close military relationship with the US. It has recently had its navy in the South China Sea. It is drawing close to China's neighbours such as Vietnam. As India's economy grows, so does its power and strategic options. When India tested nuclear weapons in 1998, it nominated China as the nuclear threat it was most concerned about.

What does all this mean for Australia? Canberra has absolutely no desire to get into the middle of any argument between New Delhi and Beijing. But Beijing looks askance at the growing strategic intimacy between Canberra and New Delhi.

Beijing tried to stop the Nuclear Suppliers Group endorsing the India-US nuclear agreement and was unhappy about Australia's decision to sell uranium to India.

Beijing has a rooted objection to any "outside" powers getting involved in Asian security.

But while Canberra certainly continues to pursue a constructive relationship with Beijing, it is unashamedly intensifying its relationship with the US. And it is also slowly and methodically building a strategic relationship with India.

Defence Minister Stephen Smith has been in India this week, his fourth visit as a government minister. I caught up with him in Delhi, where he told me: "What we have agreed to is to substantially enhance our practical co-operation on the military front starting with maritime and naval co-operation, understanding that this is a step-by-step process."

There is nothing inevitable about unpleasant strategic competition between China and India. But at the very least, it is an intense and central dynamic in the power politics of the 21st century.

Greg Sheridan is the Foreign Editor of the Australian.

Courtesy: The Australian

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