Containment policy may fail to deter China

WRITING in the Communist Party’s theoretical journal Qiushi last Saturday, Chinese President Xi Jinping rejected suggestions that China’s Marxist political economy was outdated. He insisted that it gave primacy to markets in the allocation of resources, but at the same time, enhanced the role of the government. Notwithstanding the important role of the private sector, he declared, “The leading role of the state-owned economy cannot be shaken.”

Last week, the influential weekly, The Economist, examined the subject from its liberal point of view arguing that that Xi Jinping’s China is reinventing state capitalism and that it would be a mistake to underestimate its endeavour.

As the US-China quarrel escalates, many analysts say China with its mix of authoritarianism, technology and dynamism, is too big to stop. There does seem to be a general tendency to underestimate the sheer scale of the Chinese economy, or how it has used IP theft, R&D investments, and STEM education to create important equities in technology industries. Squeezing Iran or North Korea through sanctions is one thing, but taking on China is quite another.

The Economist argues that China has been less harmed by the tariff war than was expected, and it has been remarkably resistant to the Covid-19 pandemic. It is the only economy in the IMF’s World Economic Outlook update of June 2020 that is likely to have a positive growth rate of 1 per cent in 2020. Everyone else is in negative territory. The US will be down -8 per cent, Euro area -10.2, and India -4.5.

This has probably reinforced Xi’s belief that a strong one-party state is better able to handle the challenges of our times. Xi may have stopped liberalisation of the economy and enhanced party control over private firms, but he has also pushed state-owned enterprises to follow market rules, thus strengthening the new hybrid state capitalism.

All this come at a time when China is locked in a struggle with the US on a range of issues — from trade, technology and human rights to the origins of the Covid-19 virus. US leaders like Mike Pompeo are leading the charge, blaming the ruling Communist Party of China for a host of ills. Both countries are involved in a cycle of retaliatory actions, pugnacious official statements and sanctions that appear to be intensifying.

Providing the two countries do not get into a hot war, the real battle will really play itself out in the arena of technology, and the answer to the question as to whether innovation can flourish in an authoritarian China with its techno-centric planned system, or the diffused decision-making and open system of democracies.

Around the world, especially in countries like India, there is concern over Chinese behaviour. Many think it could be a result of some Covid opportunism or to distract attention from the fallout of the pandemic at home. Richard Haass, president of the Council on Foreign Relations, says this could well be simply that China has transitioned into a new era and reflects its strengths and ambitions.

Trump Administration hawks, wary of a Biden victory in November, now want financial decoupling, meaning denying Chinese banks and companies access to the US dollars for financial settlements. Some even call for seizing the part of the US debt that is held by China. While both the options would inflict severe harm on the US and the world economy as well, the Chinese are planning for the worst. They are renewing efforts to internationalise the yuan and their central bank has reported a 36.7 per cent growth of cross-border settlement in the currency over the past year. Several proposals are doing the rounds, ranging from pricing some exports in renminbi, to creating a digital yuan for cross-border transactions.

India and the world have to decide just what do they want of China. Do they want regime change, the blocking of the economic and geopolitical rise of China, or merely a halt to its unfair trade and business practices and IP theft?

The former would involve an all-out Cold War, while the latter would suggest a coalition of countries to systematically confront China. Having so far taken on China on its own, it is doubtful whether the US could now get a coalition for a new containment policy on China, especially its more extreme versions. China is not about to keel over, but could actually emerge more resilient by being forced to adjust its economy to US pressure.

Further, countries like Vietnam, Australia and South Korea, and even Japan are heavily dependent on the Chinese economy. Recently, Australian Foreign Minister Marise Payne told the visiting Mike Pompeo that Australia had its own China policy “and we have no intention of injuring it”, spelling out the fact that the Australians made their “own decisions, own judgements in the Australian national interest.”

That still leaves India for whom Chinese economic ties are not too significant, but important geopolitical differences are. Joining US hawks in the pursuit of extreme options would be self-destructive. On the other hand, coordinating a pushback with like-minded middle powers in the region, the EU and, maybe, a better led US, would be useful. Presidential candidate Joe Biden’s support to counter border threats with China is a good beginning since this is the first time a top US leader has come out in categorical support of India in relation to Ladakh. We may not get to humiliate China, as many Indians want to, but we could create the space that would enable us to win in the longer run.

Tribune August 18, 2020

https://www.tribuneindia.com/news/comment/containment-policy-may-fail-to-deter-china-127698?

Only Rhetoric, No Facts on India-China, in PM Modi’s I-Day Address

As a country we need to be cautious in our dealings with China. It is a powerful neighbour who we should not casually handle. Yet, Prime Minister Narendra Modi’s pusillanimity in dealing with China does seem to be somewhat over-the-top.

In his Independence Day speech today, he did not mention China by name, and instead took recourse to rhetoric to comment on the issue.

In recent years Modi has avoided taking up foreign policy issues in his I-Day speech. The last time he did so was in 2016.

This is viewed as an occasion to lay out national priorities and list the achievements of the government of the day. But it is also meant to be a day of reflection and taking stock.

And who will deny that the one issue in which the ledger is very much in the red is that of China, and the issue is not just of foreign policy, but the country’s security ?

But all that Modi had to say was: “From LoC to LAC, whenever India has been challenged, our soldiers have given a fitting response in a language they understand.” They, of course, means Pakistan and China.

A Bitter Reality

This rhetorical flourish cannot conceal the fact that 20 of our soldiers died and 10 were taken prisoner in eastern Ladakh two months ago. Whether or not there were Chinese casualties is a matter of speculation.

But the reality is that even today, Chinese forces are sitting on Indian territory refusing to go back in areas of Depsang and Pangong Tso.

This is not a minor development, especially since China has also massed its forces along the LAC.

Instead, its ambassador has the cheek to suggest that it was India which is responsible for the events of this summer because it transgressed into Chinese territory.

In his statement and tone, Modi seems to be doubling down on his 19 June remarks that sought to deliberately fudge the issue of Chinese incursions.

“Neither is anyone inside our territory nor is any of our post captured,” he had said after the 15 June incident.

But we have the authority of the Ministry of Defence which in a note posted in its website that was hastily withdrawn in early August, categorically acknowledging that the Chinese “transgressed” in Kugrang Nala, Gogra, and north bank of Pangong Tso in mid-May, and that “the situation in Eastern Ladakh arising from unilateral aggression by China continues to be sensitive…”

No Official Acknowledgement

In all this, there has been no official acknowledgement or comment of what is arguably the bigger problem—an 18 km Chinese incursion that is preventing Indian patrols from accessing an area hundreds of square metres in size. Moreover, in the process, the Chinese have come dangerously closer to India’s northern-most position of Daulat Beg Oldi and the advanced landing ground there.

The government’s mendacity is evident, too, from the fact that none of those who died or were injured in the 15 June clash, or the two similar incidents in Pangong Tso in May, have figured in the Independence Day awards list. The ITBP claims that it has recommended 21 personnel for gallantry awards relating to the LAC skirmishes. It is unlikely that the Army would not have recommended its personnel for awards too.

A Deliberate Waffle?

The whole of the government approach seems to be a deliberate waffle. All that President Kovind had to say in his Independence Day eve speech was that India was “also capable of giving a befitting response to any attempt of aggression. “

Note the careful qualification, it is not aggression, but an attempt only. As for Defence Minister Rajnath Singh, the man who has made “befitting response” (Mooh-torh jawab) a trademark of his own, he issued a warning on the eve of I-Day, “if the enemy attacks us, we will give a befitting reply.” Well the enemy has, and the country waits and watches.

Clearly, the government wants to turn the page on the China chapter as quickly as possible. That is for the good. But it cannot ignore or look away from the situation on the ground. We have the PLA sitting on territory that India claims and is refusing to permit Indian troops from patrolling to the limit of the Indian claim as was the convention earlier.

The Facts of the Matter?

To New Delhi’s credit, it is making strenuous efforts to get the Chinese to restore status quo ante as of April this year.

As part of this, India’s ambassador to China Vikram Msri has met officials of the Central Mililtary Commission (CMC) of the Communist Party of China. This is no doubt a part of the understanding is that when it comes to the Sino-Indian border, it is the PLA that makes policy, not the Chinese foreign ministry. In recent years, the PLA has wanted this message to be heard loud and clear.

The sad part, however, is the persistence with which the government is seeking to pull the wool over the eyes of the people.

The facts of the matter are that our Intelligence failed to accurately assess the Chinese moves in April. The government, seeking to confuse the public on another issue, the COVID-19 pandemic, got tangled in its own rhetoric.

Army reserve units that usually are routinely moved forward when the Chinese or Pakistani conduct exercises were not moved into Ladakh in time, thus creating a dangerous situation. Fortunately, the Chinese did not contemplate an invasion but merely a bit of salami slicing.

We do not expect a PM’s Independence Day speech to be a mea culpa acknowledging all this, but in that case, he should also avoid using misleading rhetorical claims.

Quint  August 15, 2020

https://www.thequint.com/voices/opinion/only-rhetoric-no-facts-on-india-china-in-pm-modi-independence-day-address?#read-more

Atmanirbhar reality: We don’t need bans but an industrial ecosystem within which a defence sub-system can flourish

Independence Day is likely to see a renewed call for “Atmanirbhar (Self-reliant) Bharat”. So it is all for the good that RSS chief Mohan Bhagwat has cautioned that “swadeshi” need not imply the boycott of all foreign products. This should be a corrective for his followers, some of who are promoting self-reliance somewhat mindlessly.
The issue is not so much self-reliance, but ensuring that domestic products match their imported counterparts in cost and quality. Minus this, we will end up in the same place we were in the 1980s, when 1950s vintage Ambassador and Premier Padmini cars ruled the roads. In a closed shop, Indian businesses were perfectly happy churning them out and the consumers had no choice but to buy them.

A problem may already be looming here in the area of defence. Last week, the MoD issued a note calling for a graduated ban on the import of 101 products. This could well be making virtue of necessity, as the government is flat broke. Or, perhaps it is aimed to lend heft to Prime Minister Narendra Modi’s call for self-reliance. Looked at in any way, it is wrong headed. Bans are not what is needed, but strategic guidance and leadership to create an industrial ecosystem, within which a defence sub-system can flourish.

This ban is designed to do the opposite. Indian defence industry today makes platforms based on imported sub-assemblies and parts. Many such products will now be banned. But as in the past, imports of their critical sub-systems will go on and we will maintain the fiction of the platform itself being indigenous. The MoD has said, for example, that it will procure 125mm armour piercing tank ammunition that will have 70% indigenous content. More likely than not the 70% relates to material content not financial value. This is likely to be true of several listed products.

Indigenising defence industry is inherently problematic. Take fighter aircraft, you only want 100 of them. Should you then by making a fetish of indigenisation, pump in vast resources to make the thousands of assemblies and sub-assemblies that go into making the aircraft? In any case, you are unlikely to be able to fabricate an engine in the next 30 years, even if you tried. With its imported engine and radar, what’s the embargo on the LCA MK 1A as of December all about?

We can obtain better outcomes by learning from countries like South Korea. Indeed, within the country itself there are lessons to be learnt. In 1980 India built a total of 30,500 or so cars, high cost, low quality and scarce products. Maruti-Suzuki began production in 1983 and 10 years later it had produced its millionth vehicle, a low cost and high quality product. Maruti assembled the vehicle and left the issue of indigenisation to its vendors who it regulated strictly on issues of quality and cost control. Suzuki began as a minority partner in the PSU which was led by babus of the classical mould, who were recast by the experience into world class industrial managers.

The rise of Maruti helped the growth of the other industrial clusters in the country that have made us a global automobile powerhouse. The Maruti-Suzuki experience would suggest, first, that secretary, defence production should be eased out of his role as a nominated director in the boards of the various defence PSUs. Second, the government should strategically divest from the DPSUs and allow the private sector much greater room. Third, understand that scale matters. Defence-grade products must be high quality, but they are not needed in the kind of numbers that private industry can support. Defence industry must be a subset of the larger manufacturing base of the country, not the other way around. Fourth, things don’t happen in one five-year election cycle. It could take two or three of them before we see real results.

Times of India, August 15, 2020 

 https://timesofindia.indiatimes.com/blogs/toi-edit-page/atmanirbhar-reality-we-dont-need-bans-but-an-industrial-ecosystem-within-which-a-defence-sub-system-can-flourish/

Hundred Days Since Chinese Incursions in Ladakh Were Detected, India is in Unchartered Waters

In an article in the July issue of the Chinese embassy magazine China-India Review, Chinese ambassador Sun Weidong has squarely blamed India for the events of the past months in eastern Ladakh. But he said China is ready to work with India to uphold peace on the border.

But a hundred days after the first incident on the Sino-Indian border in the finger area of Pangong Tso, the Indian officers negotiating with their Chinese counterparts are finding their attitude anything but cooperative. While three-km buffer zones have been created in the Galwan Valley (Patrolling Point 14) and Hot Springs area (PP15), there has been no change in the situation in Pangong Tso, the Gogra (PP 17 and 17 A) area and, crucially, the Depsang Plains. 

It may be recalled that a clash in the Galwan river at PP14 had led to the deaths of 20 Indian Army personnel, and 10 being taken prisoner but released shortly thereafter. The number of Chinese killed or wounded remains a matter of speculation.

Also read: When it Comes to China, India Needs to Up its Deterrence Game

The seriousness of this event was underscored by the fact that these were the first casualties along the Line of Actual Control since 1975. This was despite the fact that the LAC is not marked on any mutually agreed map, and there are known points of difference along its 4,000 km length. This is because the two sides had built up an elaborate regime of border management through which each patrolled to the limits of its claim of the LAC and dealt with confrontations through elaborate protocolsNow all that has gone up in smoke and what we have is a tense confrontation along the entire length of the LAC. Behind the frontline troops, both sides have built up significant concentrations of war-waging materiel – tanks, artillery guns, missiles, fighter jets and so on.

Ambassador Sun’s article gives us an indication of the Chinese position. It is built on post-facto rationalisation. He maintains the current Chinese official line that the LAC runs along the estuary of the Galwan river, that is, either where the river has a confluence with the Shyok river flowing north to south as the term estuary is commonly understood) or near the ‘Y-bend’ in the Galwan river where the two sides clashed on June 15, as at least one Chinese map suggests. He claims that on June 6, India had agreed they would not cross the estuary of the river and both sides would build observation posts on either side of the mouth of the river. The facts are that the LAC is a good 5-6 kms away from the mouth of the river. Chinese officials had themselves given their Indian counterparts the latitude 78° 13’E, 34° 46’N as the point where it crosses the Galwan river. That is a good 0.5 km from the bend of the river where PP14 is located.

The Patrolling Points we have referred to are not new. They were set up in the late 1970s by the Government of India’s China Study Group. Which means Indian patrols have been going there routinely all these years and the Chinese could not have but known about them. In turn, India is familiar with where the Chinese patrol, and hence claim. And while there is an overlap of claims in Depsang and Pangong Tso, there was none in Gogra, Hotsprings and Galwan river valley. As the Indian spokesman noted on June 25, “Indian troops are fully familiar with the alignment of the LAC in all sectors of the India-China border areas and abide scrupulously by it.”

Also read: Let Us Not Squander the Reprieve Given By the Galwan Valley Clash

Ironically, Ambassador Sun has cited Article 1 of the 1993 Border Peace and Tranquility Agreement and Article II of the 1996 Agreement on CBMs and claims that they prohibit either side from overstepping the LAC, which is true. But he ignores the latter part of Article I of the 1993 agreement which says that the two sides will jointly work together to clarify the LAC, wherever “they have different views as to its alignment.” Or Article X of the 1996 agreement that calls on two sides “to sped up, the process of clarification and confirmation of the line of actual control.”

Despite urging by India, especially personally by Prime Minister Modi in 2014 and 2015, that the two sides clarify the LAC to prevent the kind of incidents that have now occurred, the Chinese have ignored these commitments. Even now, they show no inclination to clarify the LAC.

Ambassador Sun’s case is built on the specious argument that the Indian side crossed the LAC and therefore the onus is on India to set things right. But that is simply untrue. For reasons of its own, China has raised temperatures along the LAC, and as we have shown in the case of Galwan they are making a retroactive claim. Perhaps the Chinese want the LAC to be at the estuary, because that will give them a clear view of the Daulat Beg Oldi-Darbuk road. But wanting to be somewhere is not the same as having the right to be there.

As for the Government of India, it continues to waffle because of Prime Minister Narendra Modi’s ill-considered statement to the all-party meeting on June 19 that “neither is anyone inside our territory nor is any of our posts captured”. On June 28, Modi doubled down on the claim by declaring grandiosely in his Mann Ki Baat broadcast that “those who cast an evil eye on Indian soil in Ladakh have got a befitting response”.

Also read: A Logistical Battle Awaits the Indian Army’s Troops in Ladakh

The Ministry of Defence’s now withdrawn note of early August made it very clear that the prime minister was clearly being economical with the truth. According to the note, “Chinese aggression has been increasing along the LAC and more particularly Galwan Valley since 5th May, 2020.” The Chinese side, the note added, “transgressed”, which is the MoD terminology for Chinese incursions, “in the areas of Kugrang Nala (near Hot Springs, Gogra and north bank of Pangong Lake on 17-18 May, 2020”.

As per the note, “the situation in eastern Ladakh arising from unilateral aggression by China continues to be sensitive.” Part (iii) of the note says that despite diplomatic efforts, “the present standoff is likely to be prolonged”.

As winter sets in, two months from now, both the Chinese and the Indian side will be fighting General Winter who dictates his own schedule. Meanwhile diplomacy between the two countries is now in uncharted waters since an element of trust that is always needed in bilateral relations has melted away.

The Wire August 13, 2020

 https://thewire.in/security/china-ladakh-incursions-100-days

India and the Malacca conundrum

1. Until the 1990s, when people spoke of the Asia-Pacific, they usually excluded India. Whether it was security policy, academic discourse or economic agreements, “Asia-Pacific” ended at South-East Asia. Just how much has changed is evident from the emergence of the term “Indo-Pacific”, deliberately situating India in the new regional dynamic. But, whether it is “Asia Pacific” or “Indo Pacific”, at the core of the concept has been the vast region comprising of the 10 nations of the Association of South-East Asian Nations (ASEAN), who form a vibrant economic community bridging east and west Asia.

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As its western flank, India occupies a crucial position in the Indo-Pacific. This is evident from the fact that the bulk of the maritime traffic going through the Malacca Straits passes through, or proximate to, India’s maritime contiguous zone. Indeed, a great deal of traffic that reaches here comes from the Persian Gulf, sails past the tip of peninsular India to reach the Malacca Straits.

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Geography and geopolitics play a significant role in India’s approach to the region which has several layers— history, cultural links, trade, security, investment and economic development. India’ connect to Southast Asia comes in two ways: it is linked overland through its 1600 km land border with Myanmar. Further, through the Andaman and Nicobar Island chain, India shares maritime boundaries with Myanmar, Thailand, Malaysia and Indonesia. Fortunately, all these boundaries, including the one with Bangladesh are settled and there is no dispute on account of them.

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Flanked by the Indian mainland and the Andaman and Nicobar Islands, lies the Bay of Bengal which is also the north-east quadrant of the Indian Ocean Region (IOR). India’s eastern seaboard hosts its Eastern Naval command, as well as its premier submarine base. It is also the site of the main testing facilities for its ballistic missiles. Given this location, India aspires to be the dominant power in the region and exert influence on its littoral.

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Its major challenge comes from China, which is not on the Bay of Bengal littoral, but one that borders Myanmar, India and Thailand. As a major economy and a trading nation, China seeks secure maritime and land communications to and through the region. It is a major trade partner and investor in many of the countries of South-East and South Asia. It also has significant arms transfer ties with Sri Lanka, Thailand, Bangladesh and Myanmar. It has built and operates Hambantota port in Sri Lanka, and is building one in Kyaukpyu in Myanmar. There has been talk of grander plans of building a deep sea port at Melaka in Malaysia to undermine Singapore, or cutting a canal through the Isthmus of Kra to bypass the Malacca Strait.

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Neither of these in themselves will reduce the physical salience of India in the adjacent seas of the Andaman and Nicobar Islands.

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2. Indic culture, or the Southeast Asian adaptation of Indian culture, was widespread—ranging from Vietnam to Indonesia, Cambodia, Thailand and Myanmar. The decline of Buddhism in India and the rise of Islamic political power cut the links between the region and India. Indian traders, scholars and adventurers were followed by the Dutch, Portuguese and the British who established political control over the region. India was transformed from an exporter of manufactured goods to a supplier of raw materials for Britain and the Europeans took over the trade in spices and textiles. Under the British Empire, India, Myanmar, Malaysia, Singapore and Hong Kong were viewed as a single strategic entity though they were run by two different Secretaries of State in London.

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India was made aware of the importance of the region to its security when Japan invaded the region in 1941, over-ran Malaya and Myanmar and arrived at the gates of India. Simultaneously, Japanese submarines and raiders came through the Straits of Malacca and began to operate in the Indian Ocean.
India played a key role in shaping the post-colonial architecture of the region. India’s first prime minister Jawaharlal Nehru articulated the vision emphasising Asian unity, advancement of decolonisation, anti-racialism and rejection of great power competition. This was done through the two Asian Relations Conferences in 1947 and 1949 and culminated in the Asia-African Conference at Bandung in 1955. Though India had “introduced” the People’s Republic of China to the Afro-Asian nations in Bandung, the two soon fell out. India’s military defeat at the hands of China in 1962, sent its stock plummeting in the region.

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In the ensuing decade both India and China moved away from the region. China was feared because of its support the Malaysian insurgency, the national liberation movements in Indochina, and its links with the powerful Indonesian communist party. India went through wars with Pakistan, insurgencies and economic turbulence. Its pro-Soviet orientation kept it removed from the grouping called the Association of South-East Asian Nations (ASEAN) which had been shaped as an anti-Communist grouping in 1967. The market-orientation of the ASEAN economies and India’s persistence with “socialistic” policies kept the two regions apart in the 1970s, as did their contrary positions in relation to Vietnam and its intervention in Cambodia. But things changed thereafter as the Malaysian insurgency was defeated, the Indonesian Communist Party decimated in a pogrom and Communist states like Vietnam, Laos and Cambodia admitted into the Association.

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3. The collapse of the Soviet Union and a deep economic crisis compelled India to rejig its economic and foreign policies. On one hand, there was a rapprochement with the United States and on the other, an opening up of its economy. India inaugurated a “Look East” policy and has developed a strong institutional relationship with ASEAN as an organisation and its individual countries ever since. India was invited to become a “sectoral partner” in 1992, a Dialogue Partner in 1996 and a Summit-level partner in 2002. Linkages relating to security were established through the ASEAN Regional Forum (ARF), the ASEAN Defence Ministers Plus Meetings (ADMM) and organisations like the Council for Security Cooperation in the Asia Pacific CSCAP.

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For India, Look East and Act East have not turned out to be the kind of economic dynamo that they were expected to be. ASEAN is India’s fourth-largest trading partner and accounts for 18 percent of the investment flows into India since 2000. But a lot of this is an outcome of India’s ties with just Malaysia and Singapore. The latter accounts for over 90 percent of India’s in and outbound investment from the region. (1) On the other hand, China has built huge economic links in South-East Asia, despite the issues that several ASEAN members have with the country on account of its exaggerated maritime claims in the South China Sea.

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For the ASEAN nations, China looms large as a neighbour, trading partner and investor. As for India, its imprint is much weaker. One indicator of the difference has been the Indian decision to stay out of the Regional Comprehensive Economic Partnership (RCEP), an agreement between ASEAN and its free-trade partners – China, Australia, Japan, New Zealand and South Korea. The agreement which could come into force in 2021, has been pushed by China since it will gain enormously in influence as well as economically.

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But India has developed important security ties with the region. It began in 1995 with hosting the Exercise MILAN which took place in the Andaman Sea and saw the participation of major ASEAN navies. Since then India has held bilateral and trilateral exercises with various nations of the region, such as the Simbex with Singapore and the Sitmex with both Singapore and Thailand. (2)
ASEAN states like Singapore, Vietnam and Indonesia are happy to have India into the role of balancing China.

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So far exercises are more confidence-building events featuring search and rescue and countering piracy operations rather than purely military episodes. India also has bilateral CORPATs (Coordinated Patrols) with navies of Indonesia, Thailand, Bangladesh and Myanmar.In 2018, India sought to become part of the Malacca Sea Patrol through which countries that bordered the Malacca Straits—Singapore, Malaysia, Thailand and Indonesia— carry out coordinated aerial and maritime patrols through the straits. New Delhi had to be politely informed that under UNCLOS only states bordering the straits can patrol them. (3)

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India and Singapore have one of the most consequential relationships in the region. Both have similar institutions inherited from Britain, as well as the use of English as an official language. They have a healthy economic relationship and close ties on security issues. They have an annual ministerial and official level dialogue on security issues, as well as staff level talks between the three wings of the armed forces. Singapore Army and Air Force use Indian facilities for training. The two countries have also signed a pact to access each other’s bases and provide reciprocal logistics support for warships.

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4. In the Bay of Bengal quadrilateral, the Indian mainland and the Straits of Malacca form one diagonal and Myanmar and Sri Lanka the other.
India has the added advantage of having forward location in the Andaman and Nicobar Islands at the western entrance of the Strait. These are a group of 572 islands, of which 37 are inhabited and were the only territory of India occupied by Japan in World War II. They are spread some 850 km in a north-south orientation adjacent to the western entrance of the Malacca Straits, a major Indian Ocean choke point. The northern-most point is just 40 km from Myanmar and the southernmost 170 km from Indonesia.

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In many ways, the islands are the hinge on which India’s Indo-Pacific strategy swings between the Indian and the Pacific Oceans. Recognising their importance India established its first joint military command, known as the Andaman and Nicobar Command headquartered in Port Blair in 2001.

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The islands have three roles in India’s defence strategy. They are, first, an advance outpost to monitor ingress of hostile vessels from the Pacific to the Indian Ocean. Second, they are the flank of a vast and deep portion of the Bay of Bengal where India will maintain its nuclear-propelled ballistic missile submarines in a bastion mode Third, they are the springboard upon which India expand its strategic space and project power into the western Pacific Ocean, with a view of balancing China’s role in South-East Asia.

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But a lot of this is work in progress. As of now the force levels of the Andaman and Nicobar joint military command are not very significant. They are aimed at surveillance, more than anything else. But India has the potential of building up a significant military presence there. While the Indian Eastern Naval Fleet is a substantial one, it is still primarily aimed at controlling the ‘near seas’. As for the nuclear-armed ballistic missile submarines, they are in the process of being developed. At the moment, the lone Indian submarine INS Arihant hosts short-range missiles with little strategic significance in the Chinese context. As for the western Pacific, though India participates in military exercises with Japan and US there and is a member of the Quadrilateral Grouping or Quad along with Australia, its deployments there are not significant.

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Myanmar is a key country for India. It is the land bridge that connects the country to South-East Asia. India has a 1600 km land border with Myanmar and a 725 km maritime boundary as well. Insurgent groups from the northeastern part of India have often found sanctuary in Myanmar, while the latter also suffers from several separatist insurgencies.

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But relations between the two countries are good. They have carried out joint military operations against insurgents in their border region and in 2018, have had their first bilateral naval exercise. India also sold a refurbished Kilo-class submarine to Myanmar in 2017 and is helping train the Myanmar navy. (4)

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But Myanmar has equally good relations and an even deeper economic engagement with China, which has built an oil and gas pipeline connecting its landlocked Yunnan province with the Indian Ocean. China is deeply engaged in Myanmar and is a major supplier of military aid including jet fighters, armoured vehicles and naval vessels. But Naypitaw is careful to maintain an even-handed approach with both New Delhi and Beijing and seeks to leverage its location to its own benefit even while jealously guarding its autonomy.

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In recent years, China, India and Japan have undertaken large-scale connectivity schemes in Myanmar. The Chinese ones aim at opening up its land-locked southeastern regions, while those through India such as the India-Myanmar-Thailand Trilateral Highway project, are aimed at linking India to the rest of ASEAN. From the maritime point of view, China has helped Myanmar upgrade its ports and is building a new one at Kyaukpyu. India has also chipped in with the construction of the Sittwe port and is in the process of completing its ambitious Kaladan Multi-modal project aimed at linking Kolkata to its eastern Mizoram state, via a road and river link in Myanmar.

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Sri Lanka is just about 30 km from the Indian mainland, separated by a shallow Palk Strait which ensures that Indian maritime traffic goes around the island. The main sea lanes of communication going to the Malacca Straits go through the island’s contiguous zone. Its port of Colombo is a major transhipment hub for India. India has a long cultural and ethnic connect with Sri Lanka and between 1987-1990, it sent an expeditionary force to fight the terrorist Tamil separatist group, the Liberation Tigers of Tamil Eelam. The fear of domination and the support the LTTE got from India has made the Sri Lankan leadership, who are overwhelmingly Buddhist and of Sinhala ethnicity, wary of India. India’s refusal to get involved in the last phase of the Sri Lankan civil war against the LTTE, led to China assisting the Sri Lankan government in the mid-2000s.

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Subsequently, Beijing increased its presence on the island. Besides providing loans for infrastructure construction, China built a port at Hambantota, the extreme south of the island, making it the closest port to the sea lanes between the Malacca Straits and the Straits of Hormuz. In addition, China is funding a huge reclamation scheme on which it will build a new financial centre adjacent to Colombo.

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Since 2014, Chinese interest in the Indian Ocean has increased including growing naval traffic and submarines visiting Sri Lankan ports. This was a matter of concern for New Delhi and it reacted by supporting an opposition grouping to displace the then Sri Lankan President Mahinda Rajpakse. Though the Rajapakse family is back in power, they are more careful about unnecessarily stirring up Indian concerns. Especially now since the US has also indicated its concerns over the Chinese activity.

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South of Sri Lanka, in the middle of the Indian Ocean, the US maintains a powerful naval base in Diego Garcia. In recent years, worried about Chinese influence in the island state, the US has been seeking to enhance its military presence on the island. Since it has a major base in Diego Garcia, south of Sri Lanka, it does not want a base, but to use Sri Lankan ports and airports as logistics hubs.

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India is now seeking to work along with another existing initiative which has implications for the South-East Asian region. This is the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) established in 1997. Five of the seven states that make up BIMSTEC are rim countries of the Bay of Bengal—India, Sri Lanka, Bangladesh, Thailand and Myanmar. Bhutan and Nepal are two landlocked states which use its maritime links for their trade. (5) India is the lead country in dealing with the sectors of transportation and communications, tourism, environment and disaster management and counter-terrorism and transnational crime.

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In 2019, Prime Minister Modi invited all the leaders of BIMSTEC to attend the swearing-in ceremony for his second term. Considering he had invited leaders of the South Asian Association for Regional Cooperation (SAARC) for his first swearing-in ceremony in 2014, this was a signal of India’s determination to double down on its Act East policy. Note that barring India and Bhutan, all other countries are also participating in China’s Belt & Road Initiative (BRI). The challenge for New Delhi is to find the resources to underpin the grouping, if not on the scale of China, but somewhere near it. Relations between the countries of BIMSTEC are generally good, but its core country, if we can call it that—India— has a continental, rather than maritime orientation. (6)

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5. India lacks the capacity of taking on China by its own in the Southeast Asian region. However, over the years, it has been building ties with the US, Singapore and Japan which have important implications for the region. In addition, India has its own important bilateral ties with Indonesia and Sri Lanka.

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To balance the Chinese in Hambantota, Sri Lanka has asked India to develop Trincomalee in eastern Sri Lanka. SKIL Infrastructure has assessed the potential of the port and says that it would require a $ 1 billion investment. Japan has also evinced interest in participating in the project. (7)
There is considerable potential in India-Indonesia relations. Despite claims that Indonesia has no disputes with China on the maritime border issue, the two countries have clashed in the Natuna Islands. Jakarta has good economic relations with Beijing, but its vast archipelago with key choke points makes it a key player in any Indo-Pacific strategy.

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Two key achievements of Modi’s visit to Indonesia in May 2018 were a document on a “shared vision of maritime cooperation in the Indo-Pacific” and a Defence Cooperation Agreement. As part of this, India would not only gain access to the north Sumatran port of Sabang, at the head of the Malacca Straits, but also help to develop it. (8)

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Japan is an important player here as well. It has been a major investor as well as funder of infrastructure projects in the ASEAN region as well as India. In fact, despite the BRI, Japan-backed projects are worth one and half times more than those of China in South-East Asia. (9) Tokyo is also seeking to establish important ties with New Delhi, based on their mutual antipathy to China. As part of this, Japan is a major provider of Overseas Development Assistance to India and is also associated with the country in a larger scheme called the Asia-Africa Growth Corridor. This project aims at developing connectivity and trade in an arc from South-East Asia to India and Africa and seeks to compete with the BRI.

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In the immediate term, however, it is not India’s economic heft that could play a role, but its military capabilities. Though India has a large military, resource problems are affecting its modernisation. The Indian Navy, for example, has been left with important gaps in its force structure. Last December it was announced that instead of a 200-ship force, they would only be 175 by 2027. Given the COVID-19 induced economic contraction, even that figure looks optimistic. (10)

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In the longer term, India may like to see itself as the dominant power in the north-east Indian Ocean, but in the immediate, it must cope with issues like piracy, maritime terrorism, separatist movements within its boundaries as well as in Thailand and Myanmar. And, of course, it must keep an eye on China which has strong ties with the countries of the region and whose navy has now begun conducting regular forays into the Indian Ocean, entering mainly through the Malacca Straits.

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In the past few years, despite its resource problems, India has laid the groundwork for a more active role in the region around the Straits, using its important bases in the Andaman and Nicobar Islands. The ties it has developed with the US and its strategic partners, Japan and Singapore have been a key asset. India has emerged as a new entrant into this relationship. The Logistics Exchange Memorandum of Agreement (LEMOA) that the Washington and New Delhi have signed is a signal of the larger role India can play. The country also has similar agreements with Singapore, France and South Korea, and is negotiating one with Japan.

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India had been using American-made P-8I maritime reconnaissance aircraft for some years now. But after India signed the Communications Compatibility and Security Agreement (COMCASA) in 2018, it will be able to get communications equipment used by US platforms and seamlessly communicate between other users of the platform. Already, the two countries have been collaborating on information sharing relating to the movement of Chinese ships from the Pacific to the Indian Ocean via the Malacca Straits. In the future, there is talk of India becoming part of the Fish Hook network that the US has established to track Chinese submarine movements. Underwater sensors along the Andaman and Nicobar chain to Indonesia would be linked to an existing chain in the western Pacific, would effectively track all Chinese submarine movements. (11)

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But a lot of this remains a work in progress and depends on the policy choices that New Delhi makes. In recent years it has become more active, besides the steps outlined above, it has also agreed to increase the level of its Quad commitment. The fallout of covid-19 could see an India weakened further and this, in turn, could encourage it to reach out more strongly to the US and aid its agenda in the Indo-Pacific. This could result in a serious effort to give teeth to its Andaman and Nicobar Command which will hold the key to any significant Indo-Pacific commitment that New Delhi is willing to make.

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1. «Strengthening Asean-India Partnership: Trends and Future Prospects», Export-Import Bank of India, Jan. 2018.
2. «India, Singapore strengthen military ties», New Strait Times, 26/11/2019.
3. D. Mitra, «Indonesia Told India Its Quest to Join Malacca Strait Patrols Isn’t Feasible», The Wire, 31/5/2018.
4. H. Siddiqui, «Act East Policy: India gives Myanmar Kilo Class submarine and trains their sailors», Financial Express, 16/12/2019.
5. B. raMachandran, «India’s BIMSTEC Gambit», The Diplomat, 31/5/2019.
6. C. Xavier, «Opinion – India needs to walk the talk on Bimstec», liveMint, 28/8/2018.
7. «India frm’s interest in Sri Lankan port upgrade advances», Joc, 17/9/2018.
8. A. Beo da coSta, «Indonesia, India to develop strategic Indian Ocean port», Reuters, 30/5/2018.
9. «Japan still leads in Southeast Asia infrastructure race, even as China ramps up belt and road investments: report», South China Morning Post, 23/6/2019.
10. V. thapar, «Budget crunch forces Indian Navy to cut down on its plan for a 200-ship Navy by 2027», Sp’s Naval Forces, 3/12/2019.
11. A. Singh, «India’s “Undersea Wall” in the Eastern Indian Ocean», Asia Maritime Transparency Initiative, 15/6/2016.

Italian Geopolitical Review Limes  August 13, 2020

https://www.limesonline.com/en/india-and-the-malacca-conundrum

101 Out! Can This Embargo Transform India’s Defence Industry?

A broad rule of thumb in news rooms is that “news” announced on a Sunday is often suspect, aimed at garnering headlines on what is usually a slow news stream.

Even so, it certainly took some gall for the Defence Minster Rajnath Singh to make a big pitch for Atma Nirbhar Bharat in a period when foreign acquisitions have been raining on India. Last month, Boeing completed the delivery of 22 Apache attack helicopters to India, the first five of 36 Rafale fighters arrived and New Delhi announced the procurement of 21 Mig 29 and 12 Sukhoi 30 MKI aircraft from Russia. In May, India had signed a $ 1 billion contract to equip the Indian Navy with 24 MH 60 R helicopters.

The ministry of defence embargo on the import of 101 items in phases between 2020 and 2024 is strictly for public consumption. As former Finance Minister P Chidambaram put it, “ The only importer of defence equipment is the Defence Ministry… What the Defence Minister said in his historic Sunday announcement deserved only an Office Order from the Minister to his Secretaries!”

Instead, a headline grabbing announcement has been made of banning products which were, in many cases, already being made in India.

Snapshot

• The ministry of defence embargo on the import of 101 items in phases between 2020 and 2024 is strictly for public consumption.
  
• It includes things we weren’t importing any way.
  
• Sufficient room has been left for yet another round of imports here.
  
• What the country needs first is a blueprint of an industrial policy which will deliver results, not by the next election but a decade plus from now.
  
• The DRDO should not be able to make unsubstantiated claims to block an acquisition, something it has repeatedly done in the last half century.
  
• Just how successful the process will be depends on the honesty with which the Ministry implements it.
  

Money, Math and Mystery

As per the list there will be an near-immediate embargo on 70 products, another ten will be stretched out till 2021 before the embargo kicks in and finally the balance 21 will be targeted between 2022 and 2025. So clearly sufficient room has been left for yet another round of imports here.

The ministry has conjured up fantastic figures like the Rs 4 lakh crore of contracts that the domestic industry would receive in the next six or seven years.

This doesn’t even make for good arithmetic, considering that the current capital outlay budget is of the order of Rs 1.15 lakh crore, a significant portion of which is spent on importing weapons systems and components and sub-assemblies of systems allegedly made in India like the Sukhoi 30 MKI.

No one can quarrel with the effort of the Ministry to develop an indigenous base. National security is one area where it is best to be self-sufficient to the extent possible. This has been a long-standing dream of the country. But we have fumbled so many times that there is need for caution and careful planning. The country needs to learn to walk before it can run.

Quint August 9, 2020

https://www.thequint.com/voices/opinion/101-items-embargo-list-defence-ministry-make-in-india#read-more