Opinion Working both ways

This time everyone’s making the right noises,at least so far. No outrageous Chinese statement like the one on Arunachal Pradesh before Hu Jintao’s visit or any other diplomatic harshness that could sour Chinese Premier Wen Jiabao’s trip. The statements have all been forward-looking and,at the same time,realistic. Ahead of the visit,a lot of groundwork has gone into getting the atmospherics right and that’s been made possible at the cost of taking expectations to the lowest point on both sides.But India has done a lot more to set things right in the past year or so,and therefore,it does beg the question: why is New Delhi not pegging its expectations much higher? Take,for instance,the fact that there is finally going to be an agreement setting the stage for Chinese banks to open branches in India. There are norms for foreign banks to open shop in India,so why this enabling agreement? This was because after the economic crisis,China wanted an agreement between the central banks as an enabler,and with some safeguards. India agreed.Another story is that of telecom. Chinese majors were not finding much favour with the Indian government because of security concerns. They had a legitimate argument in seeking a level playing field,while tying up ventures with big Indian companies helped create pressure within the government. The result was a review of the entire screening process which led to new norms and essentially requiring all telecom companies provide their source code in an escrow account. The Chinese companies agreed,but in turn,this became an issue for other US and European companies. So,the tables turned as this issue went right up on US President Barack Obama’s agenda while it is a resolved issue on Wen’s agenda. At least,a thank you is due.Perhaps at the guidance of Indian business interests,and in recognition of the sound business logic that China strikes,there has been a tremendous easing up for Chinese companies across sectors. So,trade has grown to $49 billion but skewed completely in Beijing’s favour.Having come this far,India is hoping that China will reciprocate. So,will China open doors to Indian pharmaceutical companies? Will large government contracts go to Indian IT companies? In a country where the government holds all the keys,will business become a two-way street?But on a larger plane,China has been as unpredictable as ever,despite some of these positive developments,including the “jointness” shown on climate change. Stapled visas have emerged as a big issue,especially after the Chinese side politely informed Indian authorities that the Northern Army Commander would require such a visa were he to be allowed into China. No major bilateral engagement on defence has taken place since then. There is an exercise planned for next year but for that,the defence dialogue has to take place,which is not going to happen till this row is sorted out.The Sino-Pak relationship is getting stronger by the day with Beijing ready to face the charge of funding proliferation while expanding its nuclear ties with Islamabad. These are all uncomfortable issues shrouded in total unpredictability and for all its efforts,it is a fact that India has had a rough year on the political front with China.The good news,however,is that India did not seek to brush things under the carpet. It registered its protest,spoke out clearly to underline its interests and stayed firm on issues like whether or not to attend the Nobel peace prize ceremony in Oslo. The first lesson of managing a conflictual relationship is to be candid about the areas of conflict.But if conflict and competition are the running themes of this relationship,how can one introduce predictability? That’s the real question for politicians and diplomats alike. Beijing has always fancied its ability to be unpredictable and that’s why its rise is described as threatening in various capitals.At this point in time,China is locked in several battles of dominance — whether in South China Sea,Africa,West Asia or even Af-Pak. This context is what makes the difference. The more China moves to politically bark down India,the more India’s opportunities improve elsewhere. A gap in the India-China relationship means that India gravitates towards China’s other troubled neighbours. It further improves prospects of the already expanding India-US relationship. More foreign investors queue up in Indian markets and suddenly,everyone has an increased stake in India’s immediate success.But it is not all gain for India either. New Delhi realises the consequences of gravitating in such a direction. This allows China to place its cards on the table,which are essentially India’s big and small South Asian neighbours. Pakistan,of course,is the best leverage against India. Beijing has always been the last to support any international action against Pakistan-based terror groups active in India or for that matter,has been at the forefront in building infrastructure in Pakistan Occupied Kashmir. Yes,India has also realised that a gap in the relationship brings other extraneous options into play.This game of perceptions and at times,even misperceptions,has played out a few times in the recent past with undesirable consequences. In other words,friction or gaps in the bilateral relationship eventually provides space for other parties to enter,sometimes at the behest of India or China. Having met some 20 times in the past five years at the highest levels,policy-makers would like to believe that the political leaderships on both sides have realised this.Yet,unpredictable as China can be,expectations have been kept low. Until Wen and Singh agree on ways to introduce some predictability into the relationship,the India-China story will at best,essentially remain a conflictual relationship which has to be managed while cashing in on the opportunities that economic sphere may occasionally throw up.

pranab.samanta@expressindia.com