Super Economies

America, India, China and The Future of World
By Raghav Bahl
ISIN: 978-06-7008-812-6 ǁ Publishers: Random House ǁ Price: Rs. 699/-

In the first part, we looked at the preamble that Raghav Bahl builds for his case for India’s potential case in the coveted SuperEconomy club. In this second part, we look at the Raghav Bahl’s separate chapter-wise exploration of the past events of the international stage, wherein the involvement US, China and India, translated into the future case of ‘Shall it or shall it not ?’ for India’s Super Economy status.

Super economies 2In “From Falling Towers to Falling Tickers”, Bahl sees “The Dawn of Super Economy Era”. The events of 9/11uninteionally created the new opportunities for the developing nations, hastened the levelling of global playing field, ushering in new geopolitical order, whose contours would be boldly sharpened by the collapse of Lehman Brothers seven years later. The three most important words of the decade following 9/11 turned out to be not ‘war on terror’ but ‘made in China’ – be it supply of cheap goods or pouring in of Chinese savings into US Dollar….It was no accident that ubiquitous term now used to describe the first wave of globalization – BRIC(S)- was coined in aftermath of 9/11. The customised model of these countries, based essentially on free-market capitalization, allowed India and China to heal quickly from the wounds of 2008 financial meltdown.

Raring to Go” focuses on “A Growing Concert of Democracies” in the face of newly assertive China’s experiment to strengthening its grip over trade and diplomacy. Rare Earths became the symbol. By the turn of 20th century, China was supplying over 90% of world’s rare earth metals, even though its own resources were of the order of third of the global reserves. The true extent of China’s stranglehold on rare earth became alarmingly clear after a show-down with Japan in September, 2010. Even as it denied any official embargo, the shipments of rare earths to Japan drastically dwindled. China’s efforts to improve order and price leverage unintentionally driven the revival of global rare-earth production in the US and allied democracies. The united economic power of the democratic world proved to be an antidote to China’s combativeness.

Neutral No More” portrays the developments in Burma during the end-of-20th-century-beginning-of-21st-century. During the course of mid-20th century, Burma’s relation kept swinging between India and China. However nullifying the results of 1990 elections, the Military Junta sought to isolate Burma back towards democratic reforms by way of series of trade and economic sanctions. That gave China a right window to enlarge influence in the resource-rich land. However, by mid-1990s, India’s leadership began to adopt a ‘strategic realistic policy’, which favoured the limited engagement with Burma’s military rulers. Burmese military leadership’s wariness of Chinese-backed Maoist insurgency in the hills went on to aggravate over a period of time. So the Junta started diversifying its support system. India went on balancing its relationship with autocratic regime on one hand and the pro-democracy movement on the other hand. By 2011, the Junta was disbanded and was replaced by nominally civilian government. The new government hardly lost any time in unchaining Chinese shackles over its economy. Burma was now deftly playing the same multi-alignment game, mastered by the countries such as Kazakhstan in trying to escape the Soviet-Russian sphere of bear-hug influence. With most recent win Aung San Suu Kyi’s NLD the sense of transformation is now palpable.

The Burmese Story reinforces the efficacy of rare-earth showdown coordination of the democratic nations to counteract Chinese adventurism. India’s new strategic ties with countries, as varied as Japan, Australia, Singapore, Indonesia, South Korea, Vietnam, erstwhile Soviet-bloc countries as well as its neighbours continues to gain its strong impetus against the mighty dragon under PM Narendra Modi’s present central government too.

A Region at Sea” maps, primarily, South China and, secondarily, the Indian Ocean, as the main theatres of rivalry for the 21st century Super Economies. The fact that 80% China’s oil imports travels through the crowded Strait of Malacca across South China Sea partly underscores the strategic importance of the erstwhile historic events. China appears keen to expand its presence not only in South and East China Seas but also in Indian Ocean, where it has ‘helped’ in ramping up the ports in Sri Lanka, Bangladesh and Pakistan.

China’s increasing marine power has spurred small littoral states like Vietnam, Singapore and Malaysia to bolster their naval capabilities. Though, albeit tentatively. India keeps backing their tiffs with China.

China’s actions in South China Sea have tested the alignments of 21st century in much the same way its approach to Burma and rare-earth metals did. Deterring China in the South China Sea has proven far more challenging for Team Democracy than solving rare-earth crisis or winning over Burma. For one thing, many Chinese harbour an unshakable conviction that their sovereign claims are legitimate. At the same time, it also believes that US has absolutely no legitimate claim to the region, and is merely using its power to egg on China’s rival claimants….Fortunately, China is not eager enough incite actual military conflict in Asia’s waters.

In the age of Super Economies, the most promising bulwark against Chinese creep comes not from US but from the rapidly strengthening bond between Japan and India. Outwardly, Asia’s two largest democracies have little in common, but their cultural and religious connections stretch back to centuries.

To be sure, India and Japan have gone out of their way to reassure China their goal is not containment. As their bond solidified, the language of Indo-Japanese partnership grew less circumspect….To hedge its bets, China has explored broad new west-oriented foreign policy.

The fact remains that the today’s world powers don’t need to choose between being rival or allies; they can be both, or neither. Managing such bifurcated relationship requires a revolutionary kind of teamwork, careful coordination of policy, purpose and rhetoric among the like-minded countries.

Aligned With India, But Allied With Pakistan” is ‘The Great American Paradox’. The 9/11 incidents linked Osama Bin Laden’s liquidation, US presence in Afghanistan and similar incidents led to sinking of Pakistani public opinion of America to the lowest. Correspondingly, Americans too did not think much better of Pakistanis…The imploding US-Pakistan alliance heartened – or less surprised – India. The cross border sponsoring of extremist terrorism seems to have accelerated the convergence of US-India strategic interests. For America, the old adage – India can be friend, but not ally and Pakistan can be an ally but not a friend – was seen to be turned upside down. Pakistan was behaving neither like a friend nor like an ally and India was suddenly exhibiting signs of becoming both.

With Osama Bin Laden dead and Afghanistan’s future uncertain, what was left of US-Pakistan partnership quietly unravelled…One of the tensest issues between them was nukes – or rather, the security of nuclear armament in the hands of Pakistan. As the only Muslim-majority country in the world with a successful nuclear weapons programme, Pakistan would be the first stop for Islamic radicals looking for nuclear option. Pakistan’s continuing ability to secure nuclear arms remains suspect in US eyes.. As Pakistan’s behaviour grew increasingly defiant and irrational, the US found itself looking more and more to India. While preparing for departure from Afghanistan, India seemed more in place to occupy the US space. So far, India’s assistance to Afghanistan has been entirely economic and humanitarian…The continued instability in Afghanistan seems to raise the risk of India – Pakistan (probably nuclear, this time) war. The best option to try to reduce Pakistan’s India-obsession is to increase the cross-border trade and transit between the two countries. Another option is for India to rise above squabbling and push for progress on the Kashmir issue, fostering the dialogue while reducing it military presence and addressing humanitarian abuses…But the best hope may yet come from another giant presence lurking on the border – China. China has remained on the side-lines for most of the Afghan conflict; however it has started adopting a more active role once the present theatre starts to wind down. China also continues to exert subtle pressure on Pakistan t crack down harder on terrorism if its wants their economic relationships to grow.

Afghan region could end up being the first great theatre of Super Economic collaboration among US, China and India. Unlike in South China Sea or the Indian Ocean, where they play a competitive game of brinkmanship, their strategic interests align in seeing an orderly, growing AfPak as their best chance for curbing terrorism and advancing peace and prosperity in the region, and beyond.

We will continue with Raghav Bahl’s detailed background analyses in the next part – Super Economies: America and India – Heritage Link, Democratic States – Positives Enough for Convergence !? on 21st February, 2016………………….