India and China are ancient civilisations, neighbours, the two most populous countries of the world, its two fastest-growing economies, friends in global power talks such as over climate change or world trade, rivals when it comes to winning friends and influencing people around the world, conquering export markets and cornering mineral resources. They tried to be bhai-bhai for some time, then fought a war.
There is no burning desire in either capital today for a mutual relationship as between blood brothers, nor is there any hunger to run a blood feud. The sensible course for both countries is to rid their rivalry of overt friction, extend the many areas of cooperation and share the special place in the sun reserved in the 21st century for those who work economic miracles.
The biggest irritant in India-China relations is a border dispute. The dispute is a colonial legacy. The British negotiated an agreement with Tibet in 1914 in an accord at Simla on the border with India and that border, named after the then British foreign secretary McMahon, is what the government of Independent India chose to uphold.
The Chinese never accepted this boundary, saying that Tibet never had the sovereign authority to negotiate a border. The Chinese claim some 150,000 sq km south of the McMahon line as theirs, while India deems this territory as its own.
It is debatable whether it made sense for New Delhi to view a boundary drawn by the former colonial power as the final word on defining the geographical limits of two territories that were new to nationhood but had coexisted for millennia as great civilisations that respected each other.
The Chinese are not prone to respecting other civilisations. For centuries, they considered their Middle Kingdom as the centre of the universe, as the epitome of human achievement. In early 15th century, legendary admiral Zheng led a naval expedition and explored south-east and south Asia and Africa (some claim he discovered Australia and even the Americas).
He reported back to the peacock throne that the rest of the world did not contain anything worth Chinese attention. But the Chinese had respect for India, as the land of the Buddha and as the land from which they procured valuable knowledge, including that of martial arts.
That culture of respect did not survive the colonial experience. The British left, leaving opium-smoking Chinamen and tea-swilling Indians calling each other names from either side of a border dispute, oblivious of the expiry date on the commercial interests that had made the British get the Chinese and Indians hooked to stimulants from across their disputed boundary.
Emancipation from this colonial hangover took time. The Chinese went through their wrenching experience of the Cultural Revolution followed by the restoration of order and a new game of cat and mouse in which the colour of the cat did not matter so long as it caught billions of mice.
India sent AB Vajpayee to Beijing as the foreign minister of the post-Emergency Janata government, and followed it up with a visit by Rajiv Gandhi as prime minister. Since then, the two countries have quarantined their border dispute to a committee of babus from both sides and proceeded to interact like two normal nations in other matters.
Overtly. Covertly, the Chinese tried their best to keep India tied down in a perpetual deadlock with Pakistan, proliferating nuclear technology and missiles to that country, using client state North Korea for the purpose. But India has outgrown that hyphenated relationship, and after the Bush administration went out of its way to get India quasi-membership of the nuclear club and, with it, release from the high-technology denial regime that had crimped the growth of its strategic capacity, is slated to fulfil the aspiration of all countries in south-east Asia and much of the world, of emerging as a strategic balancer of emerging Chinese power.
The world increasingly recognises China as the number two power in the world, after the US. The world, in the process, underestimates Europe, whose woolly incoherence prevents its economic might from translating into proportionate political clout. The world also underestimates Russia and India.
Indians mostly underestimate India vis-a-vis China. India is actually a more efficient economy than China, contrary to all impressions. Indians invest around 36% of their output and generate close to 9% growth (let’s set aside the post-Lehman phase of global crisis). The Chinese cannot invest all of the 55% of their output they save, and get about 10% growth from the 48% they invest. Per unit of capital, India squeezes out more growth than the Chinese do.
In India, capital is not subsidised. So, Indian entrepreneurs, without access to subsidised capital, optimise the use of capital. China is yet to experience this discipline arising out of allocation of capital by the market. Indian democracy sorts out problems as they crop up — if Singur is not sorted out to the satisfaction of the land-losers, nothing can come up on that land, so it will be sorted out, sooner or later.
The Maoist challenge to Indian sovereignty is another occasion to sort out a larger, systemic problem. And it will eventually get sorted out, the political system will adjust to give agency to the rural poor and the system will gather strength, politically and economically.
Absence of democracy makes the Chinese pile up their problems. They could blow up in another Tiananmen. Another factor in India’s favour is that India will reap its demographic dividend at a time when broadband access will be universal, creating the potential for a multiplier effect on the growth process.
But of course, all this depends on India delivering on its tryst with destiny, to end poverty and ignorance and disease and inequality of opportunity, for the people at large. The Indian elephant is hobbled only by its own, self-wrought entanglement in vines. Once it frees itself, it can saunter past the dragon and the fire it breathes. The Chinese have themselves denied their dragon wings, let’s not forget.
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