AN ELEPHANT CAN RUN VERY FAST

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The United States will attend the Aero India defence show next month, hoping to profit from India's hunger for military equipment; it wants to make India a counterweight to China. The relationship between China, India and the US is ill-defined; in
a region that bristles with weapons, India also will have to contend with Japan and Russia.

Martine Bulard
Le Monde Diplomatique, January 2007
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AMIT Raina, who is a student at the prestigious Jawaharlal
Nehru University (JNU) in New Delhi, said: "An elephant can
run very fast." He inclined his head slightly as he spoke, as
many Indians do. His fellow students agreed with him and all
were convinced that India would sooner or later resume its
place in the world. They were more divided over whether the
Indian elephant could overtake the Chinese dragon, yet all
dreamed of power.

Indian civilisation once rivalled China and was pre-eminent
in Asia; in 1700 it led the world financially (1). Yet by
1820 its share of global income had fallen from 22.6% to
15.7%, half that of China (which then followed it into
decline). By 1980 India, with 3.4% of global income, and
China, with 5%, had been marginalised. China has now shown
that a country can bounce back and India wants to catch up as
fast as it can.

India has decided to throw in its lot with the United States
in a spirit of pragmatism rather than any ideological
conviction (2). Navtej Singh Sarna, foreign ministry
spokesman, in his 1960s Soviet-style office in New Delhi,
said carefully: "The US is the dominant superpower, so it is
logical that we should seek to develop good relations with
it." This normalisation follows decades of non-alignment
spent in the diplomatic shadow of the Soviet Union and
resented by the US.

India's trade with the US rose to almost 11% of the Indian
total in 2005-6; trade with Russia, which was formerly its
main partner, was only just over 1%.

India wants a lot more. Stunned by the speed with which the
economy of China has taken off (3), India makes no secret of
its desire to utilise its new relationship with the US to
attract the investment that it lacks. In 2005 foreign direct
investment (FDI) into China rose to $72.4bn; India's FDI was
only $6.6bn, although this may be an underestimate, since not
all capital movements are recorded. The Indian government did
proudly point out that it received 40% of FDI in information
technology in developing countries, while China had only 11%.
Even so, an abyss separates them.

Copying China

The government of Prime Minister Manmohan Singh has copied
China's example: among other measures it has set up special,
near tax-free economic zones, waived social protection and
lowered customs duties. These measures have yielded results.
There has been investment in IT services and in cars; in
November 2006 Renault announced the construction of an
assembly plant. The major supermarkets -- Wal-Mart, Tesco,
Carrefour -- are planning to move in: who cares if the
arrival of their vast stores kills local businesses and
overwhelms landscapes that have so far been spared the
monotonous urbanisation of the West?

"Modernisation" is under way. The US leads the investors,
followed by the island tax haven of Mauritius, Britain, Japan
and South Korea.

However, political preoccupations rather than economic
ambitions drive the Indian government: it wants recognition
as an Asian and global superpower. Hence the importance of
the deal over civilian nuclear technologies which, following
ratification by both sides of the US Congress in 2006, will
come into effect early this year, in time for President
George Bush's visit to New Delhi in March.

The embargo introduced in response to India's widely
condemned nuclear tests in 1998 will be lifted, although
India still refuses to sign the nuclear non-proliferation
treaty on the grounds that it is "discriminatory"; in an
assertion of its independence, it denies international
inspectors access to more than 33% of its installations. The
US and its allies continue to apply this demand to Pakistan,
North Korea and Iran.

India will now be able to import sensitive materials and use
nuclear power to generate electricity to meet its rapidly
expanding energy needs. The prominent diplomat, Shashi
Tharoor, the United Nations under-secretary general who
campaigned unsuccessfully to succeed Kofi Annan, explained:
"There is a more important issue than energy supply: the
agreement recognises India as a significant nuclear power in
its own right. It marks the recognition of the Indian
exception by the US and the official nuclear powers."

It is self-evident that "India is not a country like any
other"; this saying has become a mantra.

After independence in 1947 India's unique status, epitomised
by its policy of non-alignment, made it a moral force that
stood out from other third world countries in the process of
decolonisation. Now India is beginning to look like a
US-approved military power. Some Indians fear that it may be
falling into the alignment trap. The prime minister responded
by saying: "I am often disappointed by the lack of adequate
appreciation in our country, including among our political
leaders, of the changing nature of our relationship with the
world. Very often we adopt political postures that are based
in the past" (4).

Although some US senators have deplored the nuclear deal and
there has been concern that it "may enhance India's ability
to produce fissile material for weapons" (5), it has its
supporters in Washington. The Bush administration has already
expressed its disapproval of a gas pipeline project with
Iran, although this would supply a significant proportion of
India's energy needs and have the enormous diplomatic benefit
of forcing India to negotiate with its main enemy, Pakistan,
through which the pipeline would pass.

In the words of Edward Luce, a former adviser to Bill
Clinton, writing in the Financial Times
: "The pipeline would give Islamabad a strong incentive to
maintain stability with New Delhi" (6). For now, Manmohan
Singh is using Iran's excessive price demands as an excuse to
leave the issue unresolved, but this can only be a short-term
solution.

Nothing is settled

India must also come to an understanding with China. Either
the two giants build a regional understanding that will
influence Asian and international politics, or they fight it
out, which seems the more likely possibility. Nothing is
settled; there are really three parties in the ring,
including the US, or four including Japan.

The US was prepared to risk undermining the nuclear
non-proliferation treaty in order to encourage India to
become a counterweight to China, whose economic, military and
diplomatic rise threatens the long-term hegemony of the US in
the region. The US also has a problem with some traditional
allies -- such as South Korea, which has refused to adopt a
sufficiently aggressive stance against North Korea. India,
wary of its vast neighbour, is happy to cooperate with the
Bush administration for now.

China's prime minister, Wen Jiabao, visited New Delhi in
April 2005. Showing an impressive sense of history, he
pointed out that for 99.9% of the past 2,200 years the
countries had lived in harmony (7). The discordant 0.1% was
the war of 1962 (8), an unexpected defeat that heralded the
end of the Nehru era and still rankles in India.

The economist Amartya Sen has suggested that the earliest
Sino-Indian relations were initiated by trade rather than
Buddhism; after the 1962 war, economic and trading links
restored good relations (9). Trade remained marginal, at $3bn
a year, until 2000; it was expected to reach $22bn in 2006.
China sells more than it buys and wants to exploit synergies
between the economies to make good its technological deficit.
It is pushing for a free-trade agreement that India, which
has only 33% of Chinese GDP and is fearful of being flooded
by Chinese imports, rejects.

India's priority is to consolidate its ageing and relatively
weak industrial sector. It recognises that it cannot
guarantee national development if it continues to rely
financially upon the contribution of outsourced call centres,
sub-contracted services for English-speaking businesses
around the world and IT. Nevertheless, during the visit of
the Chinese president, Hu Jintao, in November 2006, it signed
13 agreements to cooperate in finance, agriculture, IT and
energy.

Another potential area for detente is energy, with its
rapidly increasing demands. The two countries are in
competition for energy resources with China well ahead,
especially in Africa. At the end of 2005 the China National
Petroleum Corporation and India's Oil and Natural Gas
Corporation (ONGC) reached an agreement to invest in the
exploitation of Syrian oil reserves. Also in 2006 the Chinese
and Indian oil ministers discussed creating a buyers' cartel
to influence prices, a fresh idea that was thwarted when the
Indian minister, Mani Shankar Aiyar, was sacked.

The joint declaration that accompanied Hu Jintao's visit
emphasised the need to "encourage collaboration between their
enterprises, including through joint exploration and
development of hydrocarbon resources in third countries"
(10). The full significance of the declaration emerged in the
context of US protests to the Indian government about its
investment in Syria. The declaration also announced that "the
two sides agree to promote cooperation in the field of
nuclear energy, consistent with their respective
international commitments". The terms of the agreement were
left vague, unlike the agreement Hu Jintao signed with
Pakistan a few days later, yet this was the first official
reference to nuclear cooperation (11). China, while
acknowledging India's agreement with the US, was trying to
prevent it from establishing itself as the US's privileged
partner.

An anti-China axis?

Despite these developments, border issues remain unresolved.
China continues to claim part of Arunachal Pradesh in
northeast India, while India claims Aksai Chin on its
northwest frontier: the commission established to settle
these disputes has made little progress. China accepted the
incorporation of the former Buddhist kingdom of Sikkim into
India in 1975. More importantly, India has recognised Chinese
sovereignty over Tibet since 2003, although India continues
to play host to the Dalai Lama and more than 100,000 Tibetan
refugees.

In July 2006 the Nathu La pass in the Himalayas reopened
after more than 40 years of closure, restoring a section of
the old Silk Road. Traffic still falls far short of the early
20th century, when more than 75% of trade between India and
China used the pass, but there are grounds for hope that
merchants will slowly displace soldiers.

Even so, India remains suspicious and fearful of
encirclement. To the north, China has long offered
unconditional support to Pakistan in its conflict with India
over Kashmir (12), and it is now investing in the
construction of a deep sea port at Gwadar, on Pakistan's
coast, close to the entrance to the Persian Gulf. To India's
southeast, China is funding Burma's navy. China claims that
it is merely trying to secure sea access in order to
guarantee the security of its imports.

India remains unconvinced and has conducted several military
exercises with US forces, including some on the Chinese
border and in the Indian Ocean, as far east as the vital
oil-tanker route through the Strait of Malacca. It is also
conducting joint operations with Japan, which has been
adopting a more aggressive military posture (13).

India wants to show off its muscles. The Bush administration
wants India to be a rampart against China, a job that most of
India's openly pro-US political elite are happy to take on.
Some members of the business community are less enthusiastic.
As Shyamal Gupta, a senior executive with the leading Indian
manufacturer Tata Sons, insisted: "What we will see is not
India against China but India plus China" (14). Some
politicians share this reticence, including Jairam Ramesh, a
member of the governing Congress party and a former minister,
who has published a sensational book, Making Sense of
Chindia.

Nobody, of course, is proposing the construction of a
Sino-Indian alliance against the US. Everybody is mindful
that Chinese leaders are banking on a close relationship with
the US, upon which China is economically dependent. Asia is
nevertheless a region where military expenditure has recently
soared: China is the world's second-biggest military spender,
Japan the fourth, and India the eighth. So giving real
substance to the declared Sino-Indian intention to "explore a
new architecture for closer regional cooperation in Asia" has
become a priority.

As The Hindu's famous columnist Siddarth Varadarajan said:
"Asia is too big to be dominated by a single power. China,
India and Japan should not even think of controlling the
region, whether on their own or with the support of an
external power." Like many progressive intellectuals,
Varadarajan advocates more active Indian participation in
regional organisations.

Russia sidelined?

Russia, previously a cornerstone of Indian diplomacy, seems
to have been sidelined. Joint declarations have been guarded
and bilateral relations tepid. Despite the collapse of the
early 1990s, trade has resumed, especially in the military
sector where it reached $6.5bn in 2005. Professor Anuradha M
Chenoy of the School of International Studies at JNU told me:
"India is the only country that has a programme of technical
and military cooperation with Russia." Russia sells the most
weapons to India, ahead of Israel, with which the previous
Hindu nationalist government established close diplomatic
relations (15).

The quest for oil and gas supplies also encourages
cooperation with Russia. In 2004 the oil minister, Aiyar,
announced: "In the half-century of Indian independence,
Russia has guaranteed our territorial integrity, and in the
second half-century it may be able to guarantee our energy
security. I am talking about the strategic alliance with
Russia in energy security, which is becoming for India at
least as important as national security" (16).

This may not be the official position, but the ONGC is
involved in the Sakhalin I and II oil and gas fields. For
Russia, which has agreed to supply India with 60 tonnes of
uranium, energy has become a weapon in its attempt to
reassert itself as a leading global player.

As Yu Bin of the International Relations Centre explained it:
"The once super military power has now become the super
petro-power under Putin, whose mission is to remake Russia as
a world power to be respected, if not feared" (17).

So is the "CIA triangle", as its detractors call it, of
China, India and the US, about to be supplanted by an
alliance between China, India and Russia? Not yet. India has
decided to join the Shanghai Cooperation Organisation (SCO)
as an observer, along with Pakistan and Iran. This body
includes four central Asian republics (Kazakhstan,
Kyrgyzstan, Tajikistan and Uzbekistan), plus China and
Russia, which are trying to build up its diplomatic muscle in
the face of increasing US influence in the region.

India does not yet seem capable of any spectacular strategic
initiative. The writer Sunil Khilnani said shrewdly: "We have
become enamoured of the idea that we are soon to become a
permanent invitee to the perpetual soiree of great powers,
and so must dust ourselves off and dress for the part . . .
But we need to deliberate over what the role should be, and
how we can most effectively achieve it" (18).

Border issues

India is at present expending much energy in resolving border
issues. Although it feels no great pressure to engage in
equal relations with smaller neighbours, it did at least join
Bangladesh, Bhutan, the Maldives, Nepal, Pakistan and Sri
Lanka in setting up the South Asian Association for Regional
Cooperation (Saarc) in 1985. Economic cooperation remains
marginal (less than 10% of trade) and the struggling
organisation is unable to transcend its own conflicts.

The strained relations between India and Pakistan contribute
to this. The talks that began over Kashmir in 2004 have made
little headway, but some trade has resumed. Discussions were
suspended after the July 2006 train bombings in Bombay, which
killed 200; India blamed them on Pakistan's secret services.
The talks resumed in October and in December Pakistan's
President Pervez Musharraf announced that, for the first
time, Pakistan was ready to abandon its claim to Kashmir if
India would do the same. The proposal was welcomed "with
interest" by Manmohan Singh. People on both sides of the
control line in Kashmir are not holding their breath.

India's relations with other immediate neighbours are less
conflictual, but by no means unproblematic, although an
agreement in Nepal in November between government forces and
the Maoists could improve the situation. The uncertainties in
Bangladesh and continued fighting in Sri Lanka are a problem
for India: there are thought to be 20,000 Bangladeshi
refugees in India, and 10,000 Sri Lankan Tamils crammed into
camps in the southern state of Tamil Nadu. Many are
destitute; they fuel the activities of violent groups and
serve to justify police abuses.

Poverty feeds the Naxalite (Maoist) movement, particularly in
West Bengal, Orissa, Telangana (Andhra Pradesh) and, further
north, in the state of Bihar on the frontier with Nepal,
where calls for independence are getting louder. According to
Singh, this is India's most serious security problem. Indian
borders are porous, but Singh forgets to mention the social
causes of friction, especially the disastrous effects of
"modernisation" upon rural areas. More than 10,000 farmers
killed themselves in 2005, most often by swallowing
pesticides, because they could not meet their debts. India
exports cereals, yet more than 50% of its children are
malnourished; 40% of Indians can neither read nor write (only
10% of Chinese are illiterate). India ranks 126th on the UN
Human Development Index, well below China in 81st place.

The few measures that the government has attempted have often
been undermined by widescale corruption; neither the
government nor the upper classes seem concerned about the
divide that separates the majority of Indians from the 60-70
million people (5-6% of the population) who have achieved a
standard of living comparable to that in Europe.

Shashi Tharoor is one of the few who acknowledge this
situation: "We must do something for the other India . . . We
must invest in hardware [roads, ports and airports, all in a
pitiful state], but also in software, the human beings to
whom we must give what they need. It is a question of
civilisation." Wholesale exclusion is the vulnerable point of
India, which seeks to present itself as the largest democracy
in the world.
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(1) Angus Maddison, Chinese Economic Performance in the Long
Run, OECD, Paris, 1998.

(2) Christophe Jaffrelot, "India's new best friend, the US",
Le Monde diplomatique, English language edition, September
2006.

(3) India has a 1% share of world trade; China 6%.

(4) Speech to the thinktank Indian Council for Research and
International Economic Relations, New Delhi, 6 November 2006.

(5) Dafna Linzer, "India nuclear report never done", Wall
Street Journal, New York, 16 November 2006.

(6) Edward Luce, In Spite of the Gods, LittleBrown, London,
2006.

(7) Jairam Ramesh, Making Sense of Chindia, India Research
Press, New Delhi, 2006.

(8) India and China were already in disagreement over Tibet
when they clashed on their Himalayan border in October/
November 1962.

(9) Amartya Sen, "Passage to China", New York Review of
Books, vol 51, n° 19, 2 December 2004.

(10) "Joint declaration by the Republic of India and the
People's Republic of China", New Delhi, 21 November 2006.

(11) See Siddharth Varadarajan, "New Delhi, Beijing talk
nuclear for the first time", The Hindu, New Delhi, 22
November 2006.

(12) See Jean Luc Racine, "Pakistan: a double game", Le Monde
diplomatique, English language edition, June 2004.

(13) See Emilie Guyonnet, "Japanese military ambitions", Le
Monde diplomatique, English language edition, April 2006.

(14) Associated Press, 22 November 2006.

(15) India needed a source of weapons to replace the
collapsed Soviet Union, but also sought to signal an
ideological alignment with anti-Muslim overtones.

(16) Anuradha M Chenoy, "India and Russia: allies in the
international political system", India's Foreign Policy, New
Delhi, forthcoming.

(17) Yu Bin, "Central Asia between Competition and
Cooperation", Foreign Policy in Focus, Washington, 4 December
2006;

(18) Sunil Khilnani, "The mirror asking", Outlook, New Delhi,
21 August 2006.

Translated by Donald Hounam
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