Understanding Proximate Rivalry | Sunday Observer

Understanding Proximate Rivalry

19 August, 2018

The synchronic rise of China and India has prompted the euphemism- ‘Asian Century’. As blurbs often do, it distorts the past, muddles up the present and blurs the future.

Throughout recorded history, the two lands and their diverse people have been pivotal to human civilization. Nothing parallels their unique positions as great reservoirs of vast wealth, deep wisdom and extensive knowledge.

The twisted assessment of India and China stems from the western notion of China and India as two demographically and geographically immense countries with stagnant and stubbornly archaic economies.

In the autumn of 1954, on October 19, Prime Minister Jawaharlal Nehru of India met Chairman Mao Ze Dong of China.

The two leaders signed on to the ‘ Pancha Seela’ compact coexistence - Mutual respect for each other’s territorial integrity and sovereignty, Mutual non-aggression, Mutual non-interference in each other’s internal affairs, Equality and cooperation for mutual benefit, and Peaceful coexistence .

Neither Nehru nor Mao anticipated the ‘Market to replace Marx’, and a rapaciously free market at that.

Nehru, India’s first Prime Minster always stood for the larger principle and championed and defended the grand idea. He was often at odds with his own people in pursuit of his global vision.

‘The vitality of the Chinese people astonishes me. I cannot imagine a people endowed with such bedrock strength going under. Something of that which I saw in China, I have sensed at times in the Indian people also. Not always, any way it is difficult for me to take an objective view. Perhaps, my wishes distort my thinking…. India constituted as she is, cannot play a secondary part in the world. She will either count for a great deal or not count at all.’

The passage appears in Jawaharlal Nehru’s ‘Discovery of India’, written in 1944 when confined in the Ahmednagar Fort prison.

At the historic encounter between Mao and Nehru, Chairman Mao summed up the Asian zeitgeist as he saw it then. “Historically, all of us, people of the East, have been bullied by Western imperialist powers. China was bullied by Western imperialist powers for over one hundred years. Your country was bullied even longer, for more than three hundred years…. we, people of the East, have instinctive feelings of solidarity and protecting ourselves….”

“China is not an industrialized country, but an agricultural country. The level of our industrial development is lower than that of India. It will take us another ten to twenty years of effort to achieve some tangible results. At present the imperialist powers still look down upon us.”

Nehru told Mao, “You are absolutely right in saying that over the past two hundred years, our two countries and many other countries in Asia have suffered from the oppression and domination of foreign colonial powers. Asia is a big continent. China is the largest nation. There were also smaller countries. They were both under the influence of their respective histories. But “we have a common experience, that is, we all have suffered from foreign rule. We have many things in common, and this is not just because of the connection of the past….

We both want to develop our countries in the shortest possible time.”

These remarks by Mao and Nehru outlined the priorities of the two leaders, destined to lead the two ancient civilizations of Asia into the twentieth century.

Nehru wanted development in the shortest possible time. Mao wanted to beat imperialism. In the process, Mao was prepared to concede twenty or thirty years to develop China’s industrial base.

Nehru was no Marxist. He was in a lifelong battle to reach a socialist equation to replace India’s caste ridden Brahmanical order. Mao was the battle-hardened communist who saw political power emanating from the barrel of a gun.

Eight years after the Pancha Seela Compact in Beijing, in the autumn of 1962 on October 20, Chinese forces marched across the McMahon line into Indian territory of Ladakh, precipitating the Sino Indian war. It lasted a month till November 21, 1962.

Irrespective of which clown, patriot, autocrat or reformer we elect in 2020, it is essential that we comprehend the simultaneous and parallel stampede of India and China to become economic superpowers. They are bound to come into close contact or conflict in our surrounding waters.

The rise of China, India, and other Asian economies in the late twentieth century, and its acceleration in the twenty-first century, represents a seminal turning point in history. Nobody understood it better than Lee Kwan Yew the Asian Grand Master in the game of geo strategic forecasting.

In an interview with the German publication Spiegel, Lee Kwan Yew said that the 21st century is the century when the world regained its historical economic equilibrium.

“What is gradually happening is the restoration of the world balance to what it was in the early 19th century or late 18th century when China and India together were responsible for more than 40 percent of world GDP. With those two countries becoming part of the globalized trading world, they are going to go back to approximately the level of world GDP that they previously occupied. But that doesn’t make them the superpowers of the world.”

Now, two scholars, Graham Allison and Robert D. Blackwill have co-authored a book that provides Lee Kwan Yew’s insights into the rise of China and India and their impact on Asia in the 21st century.

The book combines interviews with Lee Kwan Yew by the two and observations from texts of his speeches, writings and interviews. We in Sri Lanka must pay heed.

Lee Kwan Yew reminds us that China’s leaders define their economic goals in terms of “30 to 40, maybe 50, years of peace and quiet to catch up” with the West. “China wants to be China and accepted as such, not as an honorary member of the West”.

Do not talk about India and China in the same breath. They are two different countries. Does that make India a no player? No. It is a bigger player than the whole of ASEAN. China’s GDP is three and a half times that of India. But India is a big country and is a counterweight in the Indian Ocean.

I am not sure that India wants a piece of the consumer demand from China’s growing middle class, because India is scared of the competition. The Chinese have offered the Indians a free trade agreement, but the Indians have not snapped it up, because the Chinese goods will go in to India and compete.

China will not go to war with India. It is prepared to take risks; for example, it is in the Niger delta, risking Chinese lives with Chinese money, but it has decided it is worth it. It is in Angola and Sudan. It wants something out of Iran. It is making friends with Central Asian republics. It wants a pipeline from Kazakhstan in to China over a thousand kilometres, and it is prepared to build it. This is free market competition. “I do not see it as being “If you agree to sell to India, I will beat you up’ , but rather as “Whatever India offers you, I will offer more.” It is going to play by the rules of the game and is quite convinced that it can win that way.”

Democracy should not be made an alibi for inertia. There are many authoritarian governments whose economies have failed. There are as many examples of democratic governments who have achieved superior economic performances. The real issue is whether the country’s political system, irrespective of whether democratic or authoritarian, can forge a consensus on the policies needed for the economy to grow and create jobs for all, and can ensure that these basic policies are implemented consistently without leakage.

“India’s system of democracy and rule of law gives it a long-term advantage over China, although in the early phases, China has the advantage of faster implementation of its reforms.

If China’s political structures do not adjust to accommodate the changes in its society resulting from high rates of economic growth, India will have an advantage because of its more flexible political system in the long term”

What constraints does India’s culture impose on its long-term prospects?

“India is not a real country. Instead, it is 32 separate nations that happen to be arrayed along the British rail line. The British came, conquered, established the Raj, incorporated under their rule an amalgam of 175 princely states, and ruled them with 1,000 Englishmen and several thousands of Indians brought up to behave like English.

India is an established civilization. Nehru and Gandhi had a chance to do for India what I did for Singapore because of their enormous prestige, but they could not break the caste system. They could not break the habits.

Look at the construction industries of China and India. You will know the difference between one that gets things done and another that does not get things done but talk about things.”

The average Indian civil servant still sees himself primarily as a regulator and not a facilitator. The average Indian bureaucrat has not yet accepted that it is not a sin to make profits and become rich. The average Indian bureaucrat has little trust in India’s business community. They view Indian businessmen as money grabbing opportunists who do not have the welfare of the country at heart, and more so if they are foreign.”

What is India’s current economic strengths?

“India’s private sector is superior to China’s… Indian companies follow international rules of corporate governance and offer a higher return on equity as against Chinese companies. And India has transparent and functioning capital markets.

India has a stronger Banking system and capital markets than China. India has stronger institutions – in particular, a well-developed legal system which should provide a better environment for the creation and protection of intellectual property.”

What is China’s major hurdles in exacting their strategies?

“I do not know if China will be able to overcome the language barrier and the attendant difficulty in recruiting outside talent unless it makes English the dominant language, as Singapore has. Children learn Chinese first. Then they learn English. They might go to the US as a teenager and become fluent, but they have 4,000 years of Chinese epigrams in their head…

The biggest single fear Chinese leaders have is the corrosive effect of graft and the revulsion it evokes in people. They are never quite sure when it will blow up…

China faces enormous economic problems- disparity in income between the rich coastal cities and the inland provinces... Technology is going to make their system of governance obsolete. By 2030, 70% or may be 75% of their people will be in cities, small towns, big towns, mega big towns.

They will have cell phones, Internet, satellite TV. They are going to be well informed; they can organize themselves. You cannot govern them the way you are governing them now, where you just placate and monitor a few people, because the numbers will be so large.

Will China become a democracy?

No. China is not going to become a liberal democracy; if it did, it would collapse. Of that I am quite sure, and the Chinese intelligentsia also understands that. If you believe that there is going to be a revolution of some sort in China for democracy, you are wrong. Where are the students of Tiananmen now? They are irrelevant. The Chinese people want a revived China… The Chinese fear Chaos and will always err on the side of caution.