The Myth of Chindia
If the world were a democracy, 'Chindia' would have the casting vote for sure. But it's not, and the relationship between the Asian giants is a complex one, without doubt.
The Economist is swift to point out the theory:
The appealing notion here is that India and China have complementary economies. China, through its burgeoning factories, is the world’s workshop. India, with its fast-growing IT and outsourcing firms, is becoming the world's back office. With Chinese hardware providing the orchestra and Indian software writing the score, surely they can make beautiful music together?
But it does not gloss over the reality:
The current complementarity in Chindian economic ties, such as it is, looks rather old-fashioned, even colonial. India exports raw materials to China, especially iron ore, and imports cheap Chinese manufactures in exchange.
In future, fierce competition is more likely than closer co-operation. Efforts to join forces in a global search for energy security are unlikely to overcome deeply ingrained Indian suspicions of China. The mistrust dates back to India’s humiliating defeat in the India-China war of 1962, and is fed by China's ties to Pakistan. It still impedes trade and investment. Chinese firms find it hard to secure visas for their staff in India, and are excluded from some projects, such as running ports.
In IR terms, India is the periphery to China's semi-peripheral zone, and the core remains, as always, the West.
Liberalization or no liberalization, so many poor people ain't going to get rich that quick, especially in India where the insane economic policies of the 'license Raj' have never fully dissipated. And in realist thinking, the balance of power - both strategic and economic - remains at the forefront of minds in New Delhi and Beijing.
But in summary, despite the differences, their destinies may becoming ever more intertwined. So easy to lump them together; but so hard to pull them apart. Sooner or later, the chumminess will fade.
Article reproduced below.
strong>The myth of Chindia
Joined by name but not by nature
NOT so long ago “hyphenation” was the bane of Indian diplomats' lives. They seethed at the condescension with which the West would talk most easily of their country as one-half of a putative Indo-Pakistani nuclear war. Now that the hyphen has moved eastwards they are much happier. Better to be spliced with China in a notional powerhouse comprising one-third of the world’s people and much of its economic dynamism.
The relationship is starting to transcend hyphenation, at least in name. Analysts talk of “Chindia”. Jairam Ramesh, a junior minister in India’s government, and one of its sharpest thinkers, has written a book on the subject. But the reality lags. Closer integration of China and India is not inevitable, nor is it even certain that both sides should want it.
This week China’s president, Hu Jintao, has been visiting India and talking up the prospects for partnership. Bilateral trade, tiny a few years ago, is likely to reach $20 billion in 2006. India's prime minister, Manmohan Singh, says he wants to see it double again by 2010.
The appealing notion here is that India and China have complementary economies. China, through its burgeoning factories, is the world’s workshop. India, with its fast-growing IT and outsourcing firms, is becoming the world's back office. With Chinese hardware providing the orchestra and Indian software writing the score, surely they can make beautiful music together?
Perhaps. Chinese manufactured goods are appearing in ever-greater numbers in shops in India, as they are everywhere else. Indian software firms are expanding fast into China.
But Mr Singh does not want India to cede the global market in labour-intensive manufacturing to China. On the contrary, the prime minister advocates a “Chinese model” for India too. Services alone cannot generate the new jobs that India needs—some 70m of them in the next five years. That means building lots more factories and selling lots more goods.
India’s IT firms, for their part, are drawn to China less for its domestic market, which gives them relatively little business, and more by the desire to offer global delivery to their multinational clients. They fear, too, that China may be only a few years behind them in producing its own legions of exportable software engineers.
The current complementarity in Chindian economic ties, such as it is, looks rather old-fashioned, even colonial. India exports raw materials to China, especially iron ore, and imports cheap Chinese manufactures in exchange.
In future, fierce competition is more likely than closer co-operation. Efforts to join forces in a global search for energy security are unlikely to overcome deeply ingrained Indian suspicions of China. The mistrust dates back to India’s humiliating defeat in the India-China war of 1962, and is fed by China's ties to Pakistan. It still impedes trade and investment. Chinese firms find it hard to secure visas for their staff in India, and are excluded from some projects, such as running ports.
China can get twitchy too, especially over border issues. Last week its ambassador in Delhi gave a crude reminder that the hostilities of 40 years ago have been set aside, not resolved. He reasserted bluntly China’s claim to the Indian state of Arunachal Pradesh, which started the 1962 war. It was an odd move to make on the eve of Mr Hu’s visit, supposedly the climax of a “year of friendship”.
The American Senate recently approved a deal that may end India’s spell in nuclear purgatory: it will forgive India, in effect, for having developed a nuclear bomb without signing the international non-proliferation treary. That should give China even more of an incentive to treat India politely. It needs to ensure that India will not take America's side if relations between America and China deteriorate.
Indians are always quick to contrast China’s single-minded pursuit of its own interests with their own messy democratic floundering. But in China's dealings with India it is not clear that either side knows yet where its long-term interests lie.
