Author: Rajeev Srinivasan
Publication: Rediff on Net
Date: May 30, 2001
It is true that American businesses
have invested a great deal in China in the hope of making a few bucks in
that supposedly vast market. "What if a billion Chinese were to buy my
soft drinks, cell phones, or whatever else I am selling?" has been the
mantra. But somewhere along the way, they are beginning to ask, "So where
are the profits?" The answer is: "Siphoned away by my Chinese partner."
Or, "The billion Chinese aren't buying my stuff, as my partner has stolen
and reverse-engineered it and is undercutting me on the sly." Or, "The
government is bullying me to give them my proprietary technology or else
they will kick me out of here."
Nobody is making any money in China
apart from Chinese middlemen. Wisely, General Electric has made the bold
decision to stop investing in China because they see no prospect of ever
making a profit. Thus, American businesses are slowly souring on China,
and may not b e so inclined to continue to lobby for them. Thus, the business
constituency in the US, which has become China's fifth column, may not
have much use for them in future.
Then there is the question of huge
Chinese holdings of US dollars. There have been implicit threats that they
might dump these dollars in the market and cause a run on the currency.
But this is actually a double-edged sword: a weaker dollar, if that is
the result, will increase the ability of big US businesses to export; and
the cost to the US consumer is not likely to be that pronounced as the
domestic market is still predominantly supplied by domestic manufacturers.
In fact, it will make Chinese products uncompetitive in their low-price
niche!
Furthermore, if the Chinese dump
dollars, and this causes the dollar to drop in value, this will mean they
are cutting their own nose to spite their face: for the value of their
large holdings will be proportionally affected by this fire-sale of dollars
as well. So it is unlikely they will do it.
Therefore, I am certain the Chinese
will blink -- they cannot afford a trade war with the Americans. Nor can
they afford an arms race: just as the Americans beggared and destroyed
the Soviet Union, they will be able to, with superior technology and sheer
financial muscle, destroy and fragment China. It is a specious argument
that China will get into an arms race, which will in turn beggar India
by forcing it to follow suit. For, this is a game of Russian roulette,
and the Chinese know full well that they are vulnerable economically and
militarily. They will back off.
I will admit that I am assuming
that the Chinese are rational; which I do believe they are unlike, say,
Pakistanis.
So the net result of all this is
that the Chinese made a strategic mistake owing to hubris: by winning a
battle, that is, forcing the Americans to apologize for their spy plane
missions, they have annoyed the right-wing in the US so much that they
are likely to lose the war. The likes of the formidable Jesse Helms have
been looking at them rather askance anyway.
It is absolutely appropriate for
India to fish in these troubled waters by positioning ourselves as the
stable, non-proliferating, non-aggressive nuclear power and potential partner
for the US in the Indian Ocean. There will be a small quid pro quo, of
course, to be discussed in detail later. Say, in regards to Pakistan? Or
technology transfers? Or nuclear power? Or defence pacts? I am sure Uncle
Sam has lots of goodies he can distribute. Spy pictures, maybe? Who knows,
let's be imaginative and ask for the moon.
Or other useful stuff, not that
meaningless Security Council seat. By the way, it turns out that the UN
once offered India a permanent seat in the Security Council, and the omniscient
and magnanimous Nehru turned that offer down saying, "Oh no, India need
have a seat only when China has a seat in the Security Council." Now China
is returning the favour, saying, "Oh no, India need have a seat only when
Pakistan has a seat." Seems fair, doesn't it? How come the 'secular' 'progressives'
never mention this as part of their Hindi-Chini spiel?
But making friends with the Americans,
I reiterate, does not by any means imply becoming a client state of the
US. India is simply too large -- an incipient superpower -- to become a
banana republic for the Americans. I also believe -- maybe it is more hope
than belief -- that India does or will have strategic planners who can
see this. The US is very much a rogue state, which only does what it wants
to do, the rest of the world be damned: they are not a permanent ally,
only a tactical partner, to be discarded when our need for them diminishes.
On Jallianwalla Bagh Day, I was
in a country inn in the rural UK, reading the book Rogue States (South
End Press) by Noam Chomsky. Naturally, I was thinking of the UK, the rogue
state that gave us so much trouble in the past (see my earlier column,
Remember Jallianwalla Bagh). Then there is China, another rogue state that
is such a brutal colonizer in Tibet, and such an imperial threat to the
rest of Asia.
Then there is, of course, the US:
Chomsky provides, in his usual exhaustive manner, substantial evidence
that the US should be considered the greatest rogue state in the world
by its own standards: interfering in Latin America, Southeast Asia, the
Indian subcontinent, West Asia, Africa, the Pacific, in fact wherever it
pleases, for ideological and economic reasons.
I found it quite risible that the
US tried to take the moral high ground against China in the spy plane case
by talking about the Law of the Seas, which provides a twelve-mile exclusive
zone to the littoral state. It is true that the spy plane was outside this
limit, and thus in international waters, but the problem is that the US
has not signed the Law of the Seas! Just as they are about the only major
power to have consistently declined to sign the Landmine Treaty; just as
they have rescinded their treaty obligations on emissions under the Kyoto
Accord; and just as they have declined to ratify the CTBT.
Americans simply do not like constraining
themselves with global multilateral agreements. And though they frequently
run to the UN to get 'approval' when it suits them, they ignored the World
Court's explicit order to stop mining Nicaragua's harbours; they persist
with an illegal blockade of Cuba; they exceed their mandate in Iraq; and
refuse to sign an international treaty on war crimes, worried that a lot
of their own people may get caught up in it. And with good reason too:
there was My Lai in Vietnam; the horrific bombardment of non-combatant
Laos and non-combatant Cambodia, for which Henry Kissinger and Richard
Nixon deserve(d) to have been hanged; the bombing of 'friendly' civilians
in South Korea.
So what is the point in India's
allying with the Americans? What is the worth of a treaty with them? Very
little, sometimes -- as India found out when the Americans unilaterally
abrogated the treaty obliging them to supply heavy water for the Tarapur
reactor. Of course, they had plenty of weasel-word rationalizations to
offer, but the bottom line is that they just didn't feel like living up
to their treaty obligations.
Nevertheless, the US is the lesser
of the two evils. China, alas, is on our borders (thank you, yet again,
Jawaharlal Nehru, for having allowed the buffer state, Tibet, to be swallowed
up). And they are by far the more dangerous of the two to India. I have
said time and again (see my column The Danger from China) that they remind
me strongly of Germany between the two World Wars: jingoistic to the extreme,
and full of resentment and hatred for others, with memories of great humiliation
and mythologies of great imperial hauteur. Unless contained harshly and
disciplined, they are a threat.
I predict, if unchecked, a Chinese
attack on Taiwan in 2002, an unconventional attack -- an electroMagnetic
pulse -- in the atmosphere against Japan in 2005, and a conventional attack
on Siberia in 2003. And of course there is the 'Dragonfire' scenario of
a nuclear bombardment of Delhi and Bombay -- this is not fiction, it is
highly plausible if the Chinese are not hemmed in. Do see the Hindustan
Times article, 'Crouching Dragon's hidden armoury' on May 22, 2001.
No, rogue states are not dependable,
and they only pursue their own interests. And what can India do in dancing
with these wolves? Tread very gently, I suppose, and be crystal clear about
pursuing our interests and playing the wolves off against each other.
Postscript:
In a previous column I mentioned
that the gopuram for the Srirangam temple, near Thanjavur, had been built
by M G Ramachandran's Tamil Nadu government. Several readers, including
Lakshmi and Srinivasan, informed me that the pontiff of the Vaishnavite
Sri Ahobila Math, Srimad 44th Azhagiyasingar, was responsible for the entire
effort, including the fund-raising. I am told that the Andhra Pradesh and
Karnataka governments pitched in before the Tamil Nadu government did.
I am not surprised -- after all, the DMK has had no great love lost for
Hindu institutions. I stand corrected.
I feel vindicated in my assessment
of the Chinese interest in controlling energy shipments based on their
very recent tie-up to have permanent naval facilities at Gwadar, a deep-water
port the Pakistanis are building at the mouth of the Persian Gulf. They
could attempt to blockade oil tankers there as well as in the South China
Sea. This of course shows how servile and helpless Pakistan really is:
talk of the loss of 'strategic autonomy' -- this is the equivalent of BOGU
(bend over and grease up), in the colourful speech of Microsoft's CEO Steve
Ballmer.
Incidentally, this will also help
China to encircle India with a presence in the Arabian Sea to complement
their existing investments in the Coco Islands in the Andaman Sea. We do
have a strategic riposte: allowing the Americans port facilities at Visakhapatnam
or Kochi. I am certainly not suggesting this as a desirable arrangement,
but wouldn't Kerala's Marxists have an absolute fit at the possibility
of US warships steaming into Kochi? The look on their faces would be worth
the price! Seriously, we do not want the Yanks in our backyard, but the
threat of allowing them in would be quite useful to brandish.
Fortunately, even with the aggressive
plans put in place by the People's Liberation Army Navy, China is a puny
naval power. They, at least at the moment, cannot conjure up a decent battleship,
much less an aircraft carrier fleet. But they do have some submarines and
are building more.