With a friend like China, who needs enemies?

Not easy sleeping with a friend like China

From The Statesman

China is not an easy country to deal with. Chinese diplomats are tough negotiators; they use whatever leverage they have and in the process create more opportunities for themselves, as the American, Australian and European experiences show.

On a recent visit to the United States, the Chinese Vice Premier Wu Yi yielded not an inch in negotiation, not on the revaluation of the Chinese currency, Yuan, which gives China an undue advantage; not on trade surplus, which has ballooned to $232.5 billion last year; and not intellectual property, which costs Americans billion of dollars. The U.S. Treasury Secretary Henry Paulson, the former head of Goldman Sachs Group Inc., who took over the job last year, believes that Chinese are more likely to respond to negotiations than to trade restrictions, and has refused to call them currency manipulators, hoping against hope that they would come around.
He instituted Strategic Economic Dialogue with China and the second meeting, which was held in Washington with Wu in May, produced no results regarding currency or any other economic issue. China has all the advantage, why should it give up anything? China is heavily invested in US Treasury notes, which enables Americans to get cheaper loans for buying home mortgages and Chinese goods.
The mounting trade surplus threatens American security and weakens American diplomatic power. China has developed tremendous leverage against the United States, which it uses to its advantage in trade negotiations and to exercise its influence in international conflicts, for example, Iran and Sudan.

China never hesitates to leverage trade advantages for political gains. Australia’s Trade Minister Warren Truss was quoted saying that free trade negotiation with Beijing have “become tortuous,” and insisted that regardless of trade Australia will “deplore abuses of human rights, wherever they occur in the world, even if those abuses occur in countries where we have a strong trading interest.” Chinese have raised serious objections about the current 11-day visit of the Dalai Lama to Australia, warning that the bilateral relations could be adversely affected. “We express our strong dissatisfaction and stern representations over Australia ignoring China and insisting on allowing the Dalai Lama to engage in activities in Australia,” a foreign ministry spokesperson said.
China is now Australia’s biggest trading partner and its most important commodity destination. So far Australia has not yielded to Chinese arm twisting. Keeping with the tradition of openness, Australia’s foreign minister Alexander Downer told Australian television: “China has a very different political system from Australia. I’ve asked the Chinese to respect the way our culture and our political system works. It’s just not a proposition for us to refuse to give someone like the Dalai Lama a visa to visit Australia.” Nonetheless, it is to be seen how long Australia can keep up with its rhetoric on China. Trade might trump decency one day.

China-European relations are entering a difficult phase after more than a decade of upsurge, according to David Shambaugh, Professor and Director, China Policy Program, Elliott School of International Affairs, George Washington University, and a fellow at The Brookings Institute. He wrote that the European Commission’s October 2006 white paper, Communication, regarding trade and investment, asked China to change its international behaviour, which included, among other things, requests to: “open its markets and ensure fair market competition”; “protect intellectual property rights”; “end forced technology transfers”; “stop granting prohibited subsidies”; “[ensure] more accountable government”; be more “results oriented with higher quality exchanges and concrete results” in the human rights dialogue; ratify the UN Covenant on Civil and Political Rights; enter into formal dialogue with the EU and “improve transparency” concerning aid policies in Africa; “maintain peace and stability in the Taiwan Strait”. Although EU-China dialogue on Partnership and Cooperation Agreement has been continuing, nevertheless, according to Professor Shambaugh, “the EU documents do reflect a change in tone, substance, and approach to China from past precedent.” European Union has begun to take a more realistic look at Chinese trade aggressiveness and nationalistic mercantilism camouflaged as “China’s Peaceful Rise.”

Last week, Ma Ying-jeou, opposition Kuomintang (KMT) presidential candidate in Taiwan, visited India on an officially approved private visit. In the light of China’s blatant claim that Arunachal Pradesh - more than the total area of Ireland (and don’t forget Aksai Chin) - belongs to China, and denial of a visa to an IAS officer from the state, one among a hundred Indian officials purported to visit China, the Taiwan leader’s visit takes a diplomatic significance. It is time for India to understand Chinese soft-gloved aggressiveness and start building its own alliances. A former KMT chairman and a two-term mayor of Taipei, Ma met Congress chief Sonia Gandhi and Rajnath Singh, president of the main opposition Bharatiya Janata Party, for wide-ranging talks. He also visited India’s IT technology centres stating that cooperation between India’s software industry with global pre-eminence and Taiwan’s prominence in computer hardware could be mutually beneficial.
Taiwan and India do not have official diplomatic relations but they have maintained business ties with trade amounting to $3 billion dollars, a pittance compared with the $100 billion between Taiwan and the Chinese mainland. It is time for India-Taiwan relations to grow. “Certainly we appreciate the opportunity to come here, particularly as a candidate for the presidential election. This is a very sensitive role,” Ma said. “But on the other hand, I also appreciate the pragmatic attitude in doing that.” Taiwan needs breathing space and relations with India will serve both the countries. Mark his words in Delhi: “I stand for the Renaissance of Taiwan,” said Ma. “If Taiwan has to move forward it has to open up to the rest of the world including China,” he said.

In dealing with China, India cannot depend upon the generosity of “our greatest neighbour,” as Prime Minister Manmohan Singh said in a spirit of irrational exuberance, in fact another form of Hindi-Chini bhai-bhai-ism of the Nehruite era that led to the 1962 humiliations. Dr Singh is certainly well versed in Adam Smith but it is time for him to read Kautilya’s Arthashastra. India must develop diplomatic and economic leverages to negotiate with China, including building durable international alliances, strong missile defence deterrence, creative public diplomacy, and double-digit economic growth with special attention to north-eastern states, the neglected seven sisters.
(Dr ND Batra, the author of Digital Freedom, teaches communications and diplomacy at Norwich University,USA)