July 21, 2020

How India can act as a global bridge

The following article appeared in the Hindustan Times on July 21, 2020. 

Earlier this year, United States (US) President Donald Trump used his prerogative as G-7 host to suggest inviting the leaders of India, Australia, and South Korea to the annual conclave. “I don’t feel that as a G-7 it properly represents what’s going on in the world. It’s a very outdated group of countries,” Trump said in May. While he later considered adding Brazil, Trump’s proposal was overshadowed by his suggestion that Russia be included, a move opposed by many of his advisers. Meanwhile, questions persist about whether this year’s G-7 summit — already postponed — will be held at all in person amid the coronavirus pandemic.

This is not the first hint that the G-7 format will expand. Last year, France extended a similar invitation to India (along with Australia, Spain, Chile, and five African countries) when it was the host. More recently, the British government floated the prospect of a D-10 partnership of democracies (comprising the G-7-plus India, Australia, and South Korea) to cooperate on 5G telecommunications technology.

These proposals come at a time when cooperation among democracies appears to be back in vogue, amid growing concerns about China’s assertiveness, the global economic battering at the hands of Covid-19, and greater technological competition. Two new mechanisms for coordinating policies related to the pandemic reflect a similar sentiment. The first, consisting of the US, India, Japan, Australia, South Korea, New Zealand, and Vietnam (as chair of the Association of Southeast Asian Nations), involves the countries’ foreign secretaries or their equivalents. Another initiated by the US secretary of state consists of discussions with his counterparts from Japan, India, Australia, Brazil, South Korea and Israel.

While these have, so far, been one-off initiatives or issue-specific mechanisms, permanently expanding G-7 could represent a logical and natural progression. The G-7 evolved as an annual summit between heads of government after the economic shocks of the early 1970s. It was initially intended to be an informal forum for economic and political coordination involving the largest democratic economies. Starting with the five leaders of the US, Japan, Germany, France, and the United Kingdom (UK), it soon expanded to seven with the additions of Italy and Canada. Additionally, the leadership of the European Union (EU) was also included by convention.

In the 1990s, as part of a bid to incorporate Russia into a post-Cold War order, G-7 evolved into G-8. For a while, in the early 2000s, a G8+5 format attempted to engage the leaders of the largest developing economies, including China, India, Brazil, South Africa, and Mexico, before the elevation of G-20 after the 2008 global financial crisis made this redundant. In 2014, Russia was dropped after its annexation of Crimea and G-8 reverted to G-7.

The recent signals from Washington, Paris, and London suggest an opportunity to permanently amend G-7 in a manner that better reflects today’s international order and priorities. In 1980, the economies of India, Australia, Brazil, and South Korea ranked 14th, 16th, 17th, and 29th in the world, respectively. Prior to the 2020 pandemic, they were 5th, 14th, 9th, and 12th. Given their relative strengths — large populations, important geographies, technological advantages, and capable militaries — not to mention their systems of governance, the inclusion of some of these countries would undoubtedly strengthen the democratic world’s ability to address today’s most pressing global challenges.

Despite the US’s invitation this year, an expanded G-7 is by no means a foregone conclusion. For now, US entreaties and India’s openness to participating in such formats are driven by tactical considerations, including both countries’ immediate problems with China. A more permanent shift would depend upon whether future leaders perceive value. While the presumptive Democratic nominee for US president Joe Biden has stressed the need to renew multilateral coalitions, he may be reluctant to so obviously exclude China, the world’s second-largest economy.

For its part, India has an unusual opportunity. Over the next two years, it will have a leadership role at three important organisations: Chair of the executive board of the World Health Organization (WHO), non-permanent membership on the United National Security Council (UNSC), and chair of G-20. This affords a good opportunity to achieve favourable multilateral outcomes at these and other bodies.

And, yet, India confronts other challenges. One is learning how to effectively utilise such a forum. Indian officials have become so accustomed to working within the framework of the G-77 — the large bloc of developing countries at the United Nations — that working with the G-7 will require a very different mindset. In fact, India could be a natural bridge between the two international groupings, one of which represents the global South, the other the global West.

Finally, there will be the inevitable concerns about whether India’s entry into any such grouping would undermine its strategic autonomy. In fact, it does quite the opposite. India is already a member of groupings such as BRICS, the Shanghai Cooperation Organisation (SCO), East Asia Summit (EAS), Non-Aligned Movement (NAM), and G-20, all of which meet regularly at the leadership level. Associating with other major economies, all of them democracies, ought to be a worthy aspiration.

July 20, 2020

"For Our Enemies, We Have Shotguns": Explaining China's New Assertiveness


The following article - coauthored with Andrew Small - originally appeared in War on the Rocks on July 20, 2020. An excerpt is included below and the full text can be accessed here

China’s ambassador to Sweden, Gui Congyou, has a colorful turn of phrase to describe his country’s approach to foreign policy: “We treat our friends with fine wine, but for our enemies we have shotguns.” The “enemies” he has attacked in the last two years encompass a bewilderingly expansive range of media and political targets, one of the contributory factors behind China’s rapidly deteriorating reputation in Sweden, alongside the Chinese government’s unwillingness to release a Swedish bookseller that it kidnapped. His belligerent behavior has been the subject of some bemusement in Stockholm: Why would Beijing choose so comprehensively to alienate a country that should, given its free-trading tradition, leading technology sector, and unusually successful investment ties with China, be one of its closest European partners?

In recent months, it has seemed like much of the world has been subjected to the same treatment, eliciting similar questions about why Beijing should engage in such self-defeating behavior. By any measure, China’s recent foreign policy has displayed an astonishing level of assertiveness. That Beijing has shed its prior inhibitions in the midst of a devastating global health and economic crisis for which the Chinese leadership itself bears culpability, and a still-fragile economic situation in China itself makes it all the more remarkable.

For those who have observed this pattern of behavior, the reasons remain confounding. Four possible explanations suggest themselves, based on whether Beijing perceives this as a new era in its foreign policy or a temporary phase, and whether its actions are motivated by a sense of strength or vulnerability. Analyzing whether its new foreign policy reflects temporary opportunism, hubris, crisis management, or deeper insecurity is helpful in discerning whether Beijing will ultimately look to wind back its aggressive posture or if there is greater escalation to come. Yet in practice, the most effective policy responses will look very similar, regardless of China’s intentions. 

July 13, 2020

The Sunnylands Principles on Enhancing Democratic Partnership in the Indo-Pacific Region



The following document published by the Center for Strategic and International Studies (CSIS) was based on a meeting at Rancho Mirage, California, from January 23-25, 2020, to achieve consensus on a vision for regional cooperation to advance democratic governance norms in the Indo-Pacific. 

"The basis for all these diverse and inclusive efforts should always remain the promotion of human dignity. We are optimistic about the future of democracy in the Indo-Pacific region, but old challenges remain and new ones have arisen. Diverse approaches to advancing democracy must be more consciously aligned to build momentum that achieves the region’s vision for open, free, transparent, accountable, inclusive, and prosperous societies." 

Read the full document here

June 26, 2020

For India, economic growth is no substitute for grand strategy

It is common to hear in Indian strategic circles that the key to grand strategy in ensuring consistent high rates of economic growth. Economic performance certainly forms the basis for international political power. The higher a country’s rates of growth, the greater the resource base to spend on the tools of international power: military expenditure, foreign assistance, diplomatic resources, and so forth. A greater resource base also means fewer trade-offs, say between social and military spending (“guns vs butter”) or between capital and revenue expenditure in the military. China’s growth over the past three decades, and India’s to a lesser extent offer clear examples of the linkage between economic growth and political power.
However, it would be dangerous to presume that economic growth alone can substitute for a meaningful foreign policy.

The changing balance of power 

The coronavirus pandemic is likely to have a devastating impact on the global economy. But some economies will recover more quickly than others, with implications for the balance of power. While the 2008-09 global financial crisis contributed to a period of economic stagnation in Europe and Japan, China, the United States, and (to a lesser degree than expected) India recovered more strongly.
The three charts below show the changing share of nominal gross domestic product (GDP) among the G-20 economies (including the entire euro zone), which today comprise 84% of the global economy. China’s share, which was just 3% in 1995, grew from 9% to 20% between 2008 and 2019. In that same period, Europe’s declined from 27% to 18%, while the United States’ surprisingly grew from 28% to 30%. India’s share, a measly 1% in 1995, grew from 2% to 4% after the global financial crisis. While the United States has broadly held its share of global GDP among the major economies, the relative loss has been experienced primarily by Europe and Japan.
Scenario 1: A return to 2008-2019
The central question in projecting the economic distribution of power forward – in a more recessed post-pandemic world economy – is what kind of economic growth various major economies will experience as they recover. There are two possibilities to use as base lines for analysis.
The first base scenario envisages constant rates of growth. For example, if a country averaged 4% growth between 2008 and 2019, this scenario presumes that it will maintain 4% growth between 2019 and 2030. Scenario 1 would appear both a very optimistic scenario and an ambitious objective. If this is projected forward for all major economies, this is what the distribution of power would like in 2030.
China will be the largest economy by some distance, followed by the United States. There are many reasons to doubt this outlook. One is that the coronavirus pandemic is likely to be far more devastating and disruptive than the 2008-09 global financial crisis. Another is that China’s rise in particular was showing signs of structural deceleration, suggesting that it would be harder to achieve high rates of growth as it evolved from a middle income to a high-income economy. Considerations such as debt and demographics also conspire against this possibility.
Nonetheless, this offers one very optimistic baseline. It would only be possible if certain technological innovations enable productivity increases, leading to a new wave of global economic dynamism. It may also require further expanding global market access, something that also appears unlikely at this point of time as global trade talks remain stalled.
Scenario 2: Linear growth 
The second broad scenario, only slightly less optimistic, involves linear growth. This presumes that if an economy added $1 trillion to its economy between 2008 and 2019 that it would add $1 trillion between 2019 and 2030. If we project this forward to 2030, it creates a Scenario 2. In this scenario, the United States remains the world’s largest economy, but China is a close second.
How much might the coronavirus pandemic affect calculations? Using the International Monetary Fund’s latest projections for 2020 and 2021, it is possible to project three variations on this scenario. The first variation is V-shaped recovery: a one-year contraction followed by a one-year rebound which in turn is succeeded by a resumption of linear growth. The second is a U-shaped recovery, involving a one-year contraction, one-year rebound, three years of recessed growth, and subsequently steady linear growth. The third variation is one in which only China experiences V-shaped recovery while all others experience U-shaped growth. As these four charts indicate, these variations make little difference to the relative distribution of major economies by 2030.
What will be far more significant, therefore, is whether economies can maintain constant 2008-2019 growth rates or a more prosaic growth that is consistent but decelerates with time. The difference between those two will ultimately come down to a combination of demographics, human capital, investment regimes, technological innovation, employment, and favourable market access. 
Scenario 3: Ascendant China 
A third possibility is that China experiences a constant rate of growth for the next decade, while the rest of the world stumbles, experiencing only linear growth. In Scenario 3, China successfully transitions into a high-income economy and grows much larger than the United States. China’s economy would be almost 10 times the size of India’s. In a variation on that scenario, where China and India both grow at the faster rate, China’s economy is still over six times’ India’s size.
Scenario 4: Indian (and American) dynamism 
In the most optimistic scenario from India’s perspective is that India maintains a constant 2008-2019 rate of growth as the rest of the world experiences a linear recovery. This would see India benefiting tremendously from global growth over the next decade and becoming a $7 trillion economy by 2030. But as Scenario 4 indicates, India’s economy would still be about one-third that of China’s. India will have narrowed the gap, but not as significantly over a decade as some might presume. In a variation on this scenario, if India and the United States both experience the higher growth rates over this period, it still does not shift the balance of power significantly. 

Conclusion

These back-of-the-envelope projections should be taken for what they are. They do not consider extreme scenarios – so-called ‘Black Swans’ – which could possibly affect some economies: financial meltdowns, long-term recession and deflation, etc. Perhaps some countries will find that a recovery after the coronavirus pandemic is far more elusive than they had hoped. Or alternatively another set of emerging technologies may drive a new wave of global economic dynamism akin to the 1990s and early 2000s.
There are two broad conclusions to draw from this analysis. The first is that over the medium-term horizon, the severity of the coronavirus shock on economies, and their recovery, may not be as significant a determinant on future growth prospects as other factors. Specifically, the nature of growth over the next decade will be a more important determinant. The race underway by different countries to master and harness a number of emerging technologies – machine learning, automation, quantum computing, 5G telecommunications, a variety of financial and health technologies, green energy, and additive manufacturing – is therefore crucial. This foreknowledge is already driving international competition in these domains.
The second conclusion, and a very important one from India’s perspective, is that no matter how the global economy unfolds over the next decade, India is likely to remain significantly behind the two major world economies: the United States and China. The chart below shows this plainly. Given reasonable and cautiously optimistic conditions in mind, the best-case scenario would see India emerge as a roughly $7 trillion economy by 2030, by some distance the world’s third largest. But while it would narrow the gap with China, the Indian economy would still remain about one-third the its size. The worse-case scenario from India’s standpoint would be even more daunting. This would see almost a ten-fold differential, and India’s economy still about the same size as Japan or Germany.
Economic growth is important, indeed vital, for the foundations of political power. But over the medium-term future it is no substitute for important strategic decisions that New Delhi takes. In all these diverse scenarios, India has between a 4% and 7% share of the international economy among the G20 by 2030. That margin is important – not least for the welfare of average Indian citizens, and for the overall allocation of national resources. But it does not fundamentally alter the distribution of global power. The choices of how to engage, align, or respond to the other major concentrations of power – the United States, China, Europe, Japan, and Russia – as well as critical regions such as Southeast Asia, Africa, West Asia, and Latin America, will be just as consequential, no matter how fast or slow India grows over the coming ten years.

June 25, 2020

The Evolution of the India-China Boundary Dispute



The following article originally appeared in The Washington Examiner under the headline "India and China Peace Pacts Are Disintegrating" on June 25, 2020. 

On June 16, reports trickled in from the remote mountainous region of Ladakh that Indian soldiers had died in violence the previous night along the disputed border with China. Many details are still uncertain, with the Indian and Chinese governments trading blame for the incident, but what is clear is that a fight broke out between Indian and Chinese troops in the isolated Galwan River Valley. It resulted in 20 Indian Army deaths, including that of a senior officer, along with dozens of injuries, some inflicted using sticks covered in nails or barbed wire. China’s People’s Liberation Army also suffered casualties, although the Chinese government has not released the number and names of those killed.

The victims represent the first violent deaths on the India-China border since 1975 and the most fatalities at that location since 1967.

The Galwan River clash also marks a significant turn in relations between India and China — and that, in turn, will have long-lasting implications for the rest of the world.

It’s worth briefly reviewing what that relationship is, exactly, and how it got that way. Although China and India both consider themselves ancient civilization-states, historical contacts between them were limited yet important — premodern trade, plus religious and cultural exchanges, notably the spread of Buddhism from its birthplace in India to China.

Political relations were shaped by the colonial period, when India became part of the British Empire and China experienced intervention and subjugation by a number of imperial powers. The British recognized Chinese suzerainty (but not sovereignty) over Tibet, partly to preempt the possibility of encroachment by the Russian Empire. A number of border agreements were concluded in this period between British India and the Qing dynasty, although they were often vague, incomplete, or subsequently contested.

The Communist Revolution of 1949 and the annexation of Tibet by the People’s Liberation Army in 1950, coming shortly after Indian independence in 1947, meant that for the first time, China and India were immediate neighbors. India was initially quick to establish diplomatic relations with the communist government in Beijing, and the two cooperated to establish an anti-colonial consensus among Asian and African countries. But it soon became apparent that there would be trouble on the border.

The term “border dispute” tends to evoke images of a limited standoff, but the India-China row is over territory larger than the state of Pennsylvania. It consists of three distinct sectors. Disputes in the middle sector are relatively small and include grazing grounds and passes that link India with Tibet. The eastern sector includes China’s claim to almost the entire Indian state of Arunachal Pradesh, home to more people than Montana, which China calls “South Tibet.” That section includes the town of Tawang, birthplace of the sixth Dalai Lama, and thus has particular significance for Tibetans, and by extension, for Chinese claims to Tibet.

The western sector is in the Indian union territory of Ladakh, which was, until last year, part of the state of Jammu and Kashmir. Here, the borders with Tibet were never clearly demarcated. This land resembles a high-altitude desert: impossibly rough terrain with steep ravines, glaciers, and peaks rising to over 20,000 feet. In the virtually treeless landscape, landslides and dust storms are frequent, and the altitude makes it difficult to breathe without proper acclimatization.

Nonetheless, this territory is strategically important for both China and India. China constructed a vital highway through an area claimed by India in the 1950s to connect the restive regions of Xinjiang and Tibet. Ladakh is important for India not only for its own sake, but for supplying Indian forces along the disputed Line of Control with Pakistan, meaning this area is considered crucial to Indian security and to the geopolitical balance of power across a large part of Asia.

In some ways, this faceoff is a long time coming. In the 1950s, a series of developments led to an escalation of tensions on the border. One was India’s realization that China was moving the goalposts and making more aggressive territorial claims. The status of Tibet was an added complication: In the 1950s, a revolt in eastern Tibet against communist China resulted in a brutal crackdown by Chinese forces, during which the Dalai Lama and some of his followers fled to India. Amid the catastrophe of Mao Zedong’s “Great Leap Forward” and inadequate Indian military preparation, a short but sharp border war broke out in late 1962. China decisively won, advancing over some territory in the western sector. In the east, China inflicted a humiliating defeat but withdrew before the onset of winter, believing it had taught India a lesson.

India-China relations remained strained for another 15 years. Violent skirmishes erupted in 1967 in Sikkim in the eastern sector. Negotiations eventually restarted following the resumption of full diplomatic relations, and for a brief period in the early 1980s, Beijing floated the possibility of resolving the boundary once and for all. That changed abruptly in 1985, when China once again made aggressive claims, a policy that has continued. Despite another standoff in the eastern sector in 1986-87, steps toward normalization began after 1988.

Then, in a series of unusual agreements between 1993 and 2013, the two maintained a peaceful posture on the disputed border. This opened pathways to cooperation on other matters, including trade. The two sides agreed that if Indian and Chinese patrols came into face-to-face contact, they would “exercise self-restraint,” not “threaten to use force,” and “enter into immediate consultations” to resolve the problem. In practice, this resulted in both Indian and Chinese military units patrolling some of the same ground, where their claims overlapped. Despite frequent run-ins between their patrols, there was rarely violence and never any that resulted in serious injury, let alone death.

But this period also saw the beginnings of a new kind of arms race as both sides attempted to improve infrastructure — roads, bridges, and airfields — near the Line of Actual Control, the vaguely defined, de facto boundary. China moved first and more quickly, driven by a combination of political will, more favorable terrain, and, eventually, greater resources. But India soon started to catch up. The run-ins between patrols became more frequent.

In 2013, the first major standoff between India and China in 26 years occurred on the remote Depsang Plains when China attempted to establish a permanent presence in disputed territory just as India prepared to open a high-altitude airfield at nearby Daulat Beg Oldi. This was resolved when India threatened to cancel the visit of the Chinese premier. But in 2014, as Chinese President Xi Jinping was in India, another flare-up occurred in Chumar, farther south. A more significant standoff occurred in 2017, involving China’s territorial dispute with Bhutan, an Indian ally. Indian forces intervened to stop Chinese road-building in disputed territory, resulting in a brief spike in tensions.

Earlier this year, as a critical Indian road to Daulat Beg Oldi came closer to completion, Chinese forces deployed in larger numbers at the LAC, and as Indian troops matched them, standoffs occurred at four points. One was the Galwan River Valley, an area that had witnessed fighting in 1962 but had not been a major source of friction since. To the south, by a picturesque lake called Pangong Tso, Chinese and Indian forces entered into a tussle in May. In between, near an area known as Hot Springs, two smaller buildups took place.

On June 6, senior military commanders from India and China met and agreed to a road map for phased disengagement by both militaries at the Galwan River and Hot Springs. It was as this disengagement was taking place that violence erupted on the night of June 15. The Indian government accuses China of not having adhered to the disengagement road map, while China claims Indian forces crossed the LAC.

The melee in the Galwan River Valley has a number of clear consequences. The first is that China has embarked upon a massive military buildup far out of proportion to any real military threat. While observers can speculate about Chinese motives, the intimidatory nature of its actions is evident. The second is that the clash calls into question protocols that had been carefully established between the two governments since 1993. Resuscitating any level of trust on the border will now be difficult since existing agreements proved unable to prevent deadly conflict. The third is that Indian public opinion toward China has become markedly more hostile, something China has sought to avoid in the past.

But the friction also has implications for the wider world, including the United States. They bring into focus similar concerns that India, the U.S., and others — including Japan, Australia, Taiwan, and allies in Southeast Asia — have when it comes to China’s growing assertiveness. Accelerated efforts by India and the U.S. to share intelligence and assessments, improve military cooperation, and build up defense capabilities would be a natural consequence.

Since 2005, New Delhi and Washington have concluded a defense framework agreement, a civilian nuclear deal, and military agreements on logistics, secure communications, and industrial security. U.S. secretaries of state and defense often hold regular strategic dialogues (called “2+2”) with their Indian counterparts. The American and Indian armies, air forces, and navies conduct regular exercises, including a new triservice amphibious exercise. India has also acquired seven major weapons platforms, including reconnaissance and transport aircraft, attack helicopters, and artillery, from the U.S. Such tangible forms of security cooperation may now intensify.

But despite healthy cooperation on security matters, Washington and New Delhi have sparred on other issues. India-China competition over the medium-term future will not be restricted to military affairs. Should Washington reach agreements with India on matters such as trade, investment, and immigration, it would go a long way toward preserving a favorable balance of power in Asia amid China’s continued assertiveness.