“Xi can break through the negativism”

Expectations are high ahead of Chinese President Xi Jinping’s visit to India this week – the latest event in Prime Minister Modi’s hectic diplomatic calendar. From industrial parks to railways, hopes are high that China will announce a wide-ranging investment package. There are indications that Xi may well outmatch Japan’s pledge to invest $35 billion in India over the next five years says Professor M.D. Nalapat, Director, Department of Geopolitics, Manipal University, in an interview to Gateway House’s Dev Lewis.

Q. Chinese President Xi Jinping will be in India this week for one of the most anticipated visits in India’s diplomatic calendar. During PM Modi’s visit to Japan investments of $35 billion were announced. Do you expect Xi’s visit to top that?

MDN: There are a number of differences between China and Japan. First, Japan has been declining economically for about 14-15 years, whereas China has been growing rapidly in that same period. Second, Japanese politics is held to ransom by relatively small groups with narrow ideological interests, which can stymie important initiatives. China has no such constraints – you have a strong leader, Xi Jinping, who has the means to carry his conclusions forward into policy. Third, of course, is the scale of the investment. While the Japanese has generated plenty of headlines, the big boy in town is definitely China.

Q. How is the new Indian government’s engagement with China different from what we have seen before?

MDN: The point about Narendra Modi is that he has a very clear India-first policy. The previous government imported large amounts of Chinese equipment, but did not allow the Chinese to invest money in India, which would have employed Indian citizens, generated more income, and reduced the huge deficit we have with China.

Second, he believes in a generation of peace in Asia. He does not want war, and for that reason, he is trying to ensure there are no tensions between India and China. This can be avoided by interlocking interests, one of which is economic.

Q. How do you see the dynamic changing between India, Pakistan and China? Do you see India becoming far more prominent in China’s calculus?

MDN: I would say that Modi has an open mind on China. There is a threat from China but, as I always say, 10% of China is a threat, but 90% is an opportunity. PM Modi is looking at an opportunity, and will not sacrifice it because of the 10% threat. In Xi Jinping’s case, I think he understands the importance of India to China’s calculus of becoming a global superpower. China needs India – as a market, as a source of trained manpower, and as a friendly neighbor. I believe that Xi has the ability to break through the negativism about India.

Q. Do you think there will be deals regarding Chinese investment into Indian railways? What do you think the Chinese industrial parks that have been planned will look like?

MDN: Chinese leaders previously came with lean delegations. Xi is coming with six cabinet ministers, including the ministers for reform, who have oversight over several lower ministries. He is also coming with about 70 top business people from both the public and private sectors. They’re not coming for a holiday, but to do deals with their Indian counterparts.

I have been told that deals are going to be announced between Chinese companies and large Indian conglomerates. Major industrial cities have been planned in Maharashtra and Gujarat. Why do I call them cities – because they will be much more than parks. It’s not just hundreds or thousands, but tens of thousands of acres. We are looking at 40-50 Chinese companies investing in these centers. I think you’re going to see around 200-240 deals being signed during Xi’s visit.

Q. How do you think Xi and Modi can improve the public perceptions in both countries?

MDN: What is important is for both countries to understand each other and for that tourism, business and educational exchanges have to be enhanced.

However, each time there is a high-level visit, you will see all kinds of negative stories in the media about India in China, and China in India. This is completely unjustified by realities on the ground.

India and China need to have a strong partnership. Both need to ensure that the threat to each other, despite other countries’ characterisation of it, falls to zero, and the opportunity goes to 100%.

This interview was exclusively conducted by Gateway House: Indian Council on Global Relations. You can read more exclusive content here.

For interview requests with the author, or for permission to republish, please contact outreach@gatewayhouse.in.