Atanu Dey On India's Development

Pragati 2009 May: Changing China

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pragati_may_2009

[Download May 2009 pdf edition of Pragati 3.7 MB.]

In an editorial piece for Pragati, Nitin Pai writes:

At a time when China seeks to play in the same league as the superpower of the day, it is to be expected that it will try to extract advantageous positions in the Indian Ocean region at India’s expense. The big scandal is not that China is securing bases in India’s neighbourhood by shoring up nasty regimes and abetting their outrageous policies; but rather, India does not even show any sign of doing what is necessary to protect its interests.


There is only so much any entity — states, groups, or individuals — can do given limited resources. One of the most important resources in short supply is attention. China’s policymakers are busy figuring out how China can develop economically rapidly. With economic might comes the ability to project military power and China is doing precisely that. There are scores of examples of how China is using its economic power to encircle India.

Jeremy Page, writing in The Times, May 2nd 2009, notes

[In the fishing town of Hambantota in Sri Lanka] China is building a $1 billion port that it plans to use as a refuelling and docking station for its navy, as it patrols the Indian Ocean and protects China’s supplies of Saudi oil. Ever since Sri Lanka agreed to the plan, in March 2007, China has given it all the aid, arms and diplomatic support it needs to defeat the Tigers, without worrying about the West.

Even India, Sri Lanka’s long-time ally and the traditionally dominant power in South Asia, has found itself sidelined in the past two years — to its obvious irritation. “China is fishing in troubled waters,” Palaniappan Chidambaram, India’s Home Minister, warned last week.

The Chinese say that Hambantota is a purely commercial venture, but many US and Indian military planners regard it as part of a “string of pearls” strategy under which China is also building or upgrading ports at Gwadar in Pakistan, Chittagong in Bangladesh and Sittwe in Burma.
. . .
In April 2007 Sri Lanka signed a classified $37.6 million (£25 million) deal to buy Chinese ammunition and ordnance for its army and navy, according to Jane’s Defence Weekly.

China gave Sri Lanka — apparently free of charge — six F7 jet fighters last year, according to the Stockholm International Peace Research Institute, after a daring raid by the Tigers’ air wing destroyed ten military aircraft in 2007. One of the Chinese fighters shot down one of the Tigers’ aircraft a year later.

“China’s arms sales have been the decisive factor in ending the military stalemate,” Brahma Chellaney, of the Centre for Policy Research in Delhi, said. “There seems to have been a deal linked to Hambantota.”

Since 2007 China has encouraged Pakistan to sell weapons to Sri Lanka and to train Sri Lankan pilots to fly the Chinese fighters, according to Indian security sources.

China has also provided crucial diplomatic support in the UN Security Council, blocking efforts to put Sri Lanka on the agenda. It has also boosted financial aid to Sri Lanka, even as Western countries have reduced their contributions.

China’s aid to Sri Lanka jumped from a few million dollars in 2005 to almost $1 billion last year, replacing Japan as the biggest foreign donor. By comparison, the United States gave $7.4 million last year, and Britain just £1.25 million.

The important thing to note is that China is able to buy influence around because it has the money to do so. How did it get the money? By getting its economic policies right. In the end, economic policies matter not just for domestic prosperity but also in the state’s ability to project power beyond its borders.

India’s policymakers got the economic policies wrong. Around 1978, India was pretty much at par with — if not marginally ahead of — China. Today China is miles ahead of India and the gap will continue to widen.

The problem is at least partly that Indian policymakers have different goals. Their attention is diverted to such things as how to distribute the limited production among competing interest groups. They don’t worry so much about how to increase the economic output of the state, as about how to take from one group and give it to another group that has “a first claim” to resources. That is what electoral democracy in India is about: take from Paul to give to Peter so that Peter’s support is assured.

If your attention is fully occupied with instigating domestic squabbles so that you can mediate and win the approval of some sections of the voters, you cannot think long term about economic development. Without economic development, the state is too poor to do anything — including influencing its neighbors and winning friends.

The Congress party has governed (more accurately, misgoverned) India for most of its existence as a state in modern times. Nehruvian socialism dragged India into a hole so big that it would take decades for it to climb out of. Then the Congress party, to continue to remain in power, decided that the best way was to discriminate against people based on religion and caste, and hand out goodies to specific groups.

I think it is still not fully in the public consciousness that India is pathetically poor because of what Nehru did to begin with, and then the subsequent descent into the abyss was done by his progeny. Only when the Indian voter actually realizes the source of their misery — misgovernance by Congress — will there be change.

China changed in 1978, and is continuing to change. The question that should occupy us is when will India change?

  • pankaj

    Economic policies are one thing , india also is not homogenous its a hopelessly divided nation so many groups and sub groups . no loyalty to country but to their own groups .Not thinking big like, india is bigger than any of our group .chinese lot of unity and love for mother land.
    recent elections how may politicians spoke of united india?